CA Prop 46 Takes Aim At Medical Malpractice Caps

This November, California voters will get to decide whether or not the caps on damages in medical malpractice cases should be raised for the first time since they were enacted in 1975. Along with this lift on damages, will be further measures to prevent doctors from being under the influence of alcohol or drugs while treating patients and to prevent them from over prescribing pain medications to persons with a history of substance abuse. The ballot initiative is proposition 46 (also known as the Troy and Alana Pack Safety Act of 2014) and the highlights are as follows:

• An increase in the current limit on non-economic damages from $250,000 to account for inflation since 1975, which would place the limit at slightly over $1 Million.
• Require drug and alcohol screening of physicians and mandatory reporting to the California Medical Board for those who test positive.
• Require the CA Medical Board to suspend doctors pending investigations following a positive druge test and to take disciplinary action if a doctor is found to be under the influence of alcohol or drugs while on duty.
• Require health practitioners to report any physician suspected of drug or alcohol impairment while on duty or medical negligence.
• Require physicians to run a check through the state prescription drug history database before prescribing certain controlled substances.

The measure will not affect any other aspects of the Medical Injury Compensation Reform Act (MICRA) that was enacted in the early 1970’s other than the cap on pain and suffering damages. The limitations on attorney’s fees, shorter statute of limitation and the various other aspects of that law will stay in place. Moreover, the damages cap is simply being adjusted for inflation. The question then becomes, why are physician’s groups in California touting this measure as, “trial lawyers waging an aggressive campaign to weaken or overturn California’s landmark Medical Injury Compensation Reform Act”. (California Medical Association blog). Would the increase of pain and suffering damages to simply account for inflation have the “drastic” consequences of driving up medical malpractice insurance premiums and send doctors fleeing the Golden State! The statistics and evidence simply don’t bear out their arguments.

Myth: MICRA was a necessary measure to stem a major “crisis” in California of rising medical malpractice insurance premiums.

Fact: In 1975, the insurance industry was not nearly as regulated as they are presently with regard to regulation of premium increases. All studies on the issue failed to point to “frivolous” medical negligence claims as a cause for the increased cost of insurance for physicians. In fact, many experts opined that the poor economic conditions of the period had more to do with the premium increases as insurance companies depend upon investment income to make a profit.

Myth: MICRA has served to reduce medical negligence insurance premiums and raising the cap on economic damages will cause these premiums to go back up.

Fact: National statistics show that premiums for physicians in states with caps on damages are actually higher than in states without caps. In addition, between 2001 and 2011, payments for malpractice claims went down by 50% and profits for insurance companies went up but, premiums only decreased bya whopping 7 %. This appears to indicate that any reduction on claims simply goes to line the pockets of the insurance industry and does very little to reduce premiums for doctors.

Myth: States without damages caps are suffering from a “doctor shortage” and caps serve to keep doctors in the state.

Fact: States without damages caps (like New York) actually have a higher number of physicians per capita than states with caps (like California or Texas).

The fact is that simply increasing the limit on non-economic damages to account for inflation is a just and fair measure for all Californians. The insurance lobby was behind the enactment of MICRA and will, no doubt, pour millions of dollars into trying to convince the average person in the Golden State that the measure was and is fair but, what is fair about limiting parents of a dead child to $250,000 in recovery? What is fair about putting this same cap on recovery for the loss of a limb? In addition, wouldn’t we all be more safe if we had testing of doctors and disciplinary procedures in place when physicians operate under the influence of alcohol or drugs or improperly prescribe narcotics to patients proven to be a risk? I think this answer is YES. Vote YES on 46!

Additional Resources: Ballot Pedia – Full Text of The Proposed Bill Consumer Attorneys of California – MICRA Issues Overview