A court struck down caps on noneconomic tort damages because the limits on recovery for injured plaintiffs violate the Equal Protection clause. State legislatures worried about the cost of tort litigation often turn to such caps to help keep down insurance rates. The state court found the law lacked a rational basis to any alleged medical-malpractice insurance crisis.
The Florida Supreme Court found that the caps violate the state's Equal Protection clause by limiting damages for those most severely injured while allowing full recovery to patients who suffer trivial harms. In reaching its decision, the court also pointed to the lack of evidence showing a connection between med-mal damages and insurance premiums. The court held that without such evidence no rational basis exists for the legislature's discriminatory remedy.
Med-mal caps limit the amount of damages for which doctors can be liable, which should reduce the cost of med-mal insurance. Cutting the cost of insurance should also lower the cost of medical care by lowering the doctor's costs. Yet, the effectiveness of these caps lacks a consensus of evidence.
Routine Medical Procedure Gone Wrong
The patient never expected that a routine outpatient surgery to treat carpal tunnel syndrome in her wrist would go so terribly wrong. On awaking from surgery, she complained of chest and back pain, but the doctors never looked down her throat. It turned out that the tube placed in the patient's throat during surgery punctured her esophagus. Although surgery saved the patient's life, doctors placed her in a drug-induced coma for several weeks. She underwent intensive treatment to be able to eat and move normally again.
At trial, the patient testified to extensive pain and physical limitation. A typical patient could not foresee this injury making it especially egregious. "If you were making a list of the potential risks associated with surgery for carpal tunnel syndrome, this outcome would not be on the list," states Aaron Krauss, Philadelphia, PA, cochair of the ABA Section of Litigation's Health Law Litigation Committee.
After suing the doctor, a jury awarded the injured plaintiff $4 million in noneconomic damages for her pain and suffering. The court then reduced the noneconomic damages to $2 million consistent with the statutory caps. The patient then appealed to the Florida Supreme Court. She argued that the caps were unconstitutional because as a severely injured patient, it arbitrarily limited her damages while fully compensating similarly situated patients who suffered less harm. The appellate court agreed.
Rational Basis with a Bite
The Florida appellate court was narrowly divided, 4–3, over the constitutionality of the caps. "The nub of the dispute between the majority and the dissent is the standard of review. Justice Polston, for the dissent, criticized the majority for augmenting the deferential rational basis standard," explains O. Andrew Wilson, New York, NY cochair of the Section of Litigation's Civil Rights Litigation Committee.
The legislature enacted the caps to address a medical-malpractice crisis that, according to the legislature, resulted in doctors leaving their practices early and refusing to do risky procedures. In finding the caps unconstitutional, the Florida court doubted whether such an on-going crisis really existed, if it ever had. The court cast doubt on the evidence cited by the legislature and questioned its conclusions.
"The majority opinion is certainly correct that doctors' decisions where to practice and what procedures to perform are informed by many factors," says Krauss. These factors other than med-mal insurance rates include "Medicare and Medicaid reimbursement rates and payment reforms related to the Affordable Care Act," he adds.
The dissent argued that the majority took a more critical view of the caps than normally required under rational basis. "Typically, rational basis review is limited to examining whether it is conceivable the challenged legislation bears a rational relationship to a legitimate government policy. Here, the dissent criticized the majority for going beyond this standard to strike down Florida's damages cap based on the lack of evidence of an insurance crisis or evidence that such a crisis could be alleviated with caps," notes Wilson.
A Future for Tort Reform?
Many states enacted medical malpractice caps and now Florida is the most recent state to hold these caps unconstitutional. Nonetheless, states looking to lower insurance premiums through tort reform have found several other means to carry out their goal.
Traditionally, courts relied on the remedy of remittitur, which allows the judge to reduce a jury award to nullify the most outrageous jury awards. Many state legislatures recently focused on administrative solutions to the problem of excessive awards. For example, several states created peer-review committees to screen out unmeritorious tort claims.
Other states reached for more innovative solutions. For example, some legislatures created re-insurance funds, which leave doctors and insurance companies on the hook for the vast majority of smaller med-mal claims but offer protection against the largest verdicts. Still other states sought more practical, common sense solutions. For example, some states instituted "cooling off" periods to encourage settlement and alternative dispute resolution.
The success of such reforms may show that medical malpractice has more to do with the common-sense actions of physicians than legal solutions. "This whole incident may have been avoided if anyone had thought to ask the patient to 'Open up and say, Ahh!'" Krauss concludes.
Stephen Carr is a contributing editor for Litigation News.