Lawmakers mired in malpractice mess

In terms of acrimony, the medical malpractice debate is giving the tax issue a run for it's money.

The Nevada legislature this week will continue wrestling with an array of legislation designed to rein in rising premiums for medical malpractice insurance, which, according to one side of the debate, are driving much-needed doctors out of the state.

Everyone agrees the cost of insurance is the issue, but there is a deep-seated difference of opinion on the cause of the problem and how to solve it.

Right now there are nine bills addressing the matter in several different ways from tort reform legislation that would cap non-economic damage awards to laws that would more strictly regulate the insurance industry.

Doctors, in the form of a group called "Keep Our Doctors in Nevada," are running television ads and lobbying the legislature to limit both the amount lawyers can make from medical malpractice lawsuits and juries can award plaintiffs, as well as allow doctors to divvy up blame when malpractice is found.

The Henderson-based group last year collected over 75,000 signatures on a petition that requires the legislature to consider its proposal.

The doctors' petition has been killed by the Senate Judiciary Committee, so now it will end up as a ballot question for voters in the 2004 election.

The committee, meanwhile, this Tuesday will be hearing testimony on three malpractice bills, including Senate Bill 97, a bill that mirrors the doctor's petition.

During an earlier hearing on SB97, Dr.

Rudy Manthei, the leader of the doctor's group, testified that a jump in the cost of insurance was a direct result of huge medical awards.

"That's why premiums have increased," said Manthei.

Manthei and others say the only way to control premium costs is to place caps on awards, and cite other states California, in particular where caps have been instituted.

The U.S.

Congress agrees; it passed legislation earlier this month that places a $250,000 cap on non-economic damages.

In last year's special session, the Nevada legislature passed Assembly Bill 1 which places a $350,000 cap on such awards.

Manthei and others say that doesn't go far enough while opponents, such as the Nevada Trial Lawyers Association, say the law hasn't been given a chance to work.

Some say award caps will do nothing to solve the problem.

In California, for example, the state passed laws in 1975 putting a cap on awards.

Malpractice premiums continued to rise, and then it passed insurance industry reform legislation in 1988 which rolled back rates.

Americans for Insurance Reform, a coalition of consumer groups, says there is a direct correlation, but it's not between awards and premiums.

According to AIR, jury awards and settlements track medical inflation; malpractice payouts have risen 6.2 percent over 10 years, according to National Practitioner Data Bank data, while medical inflation has been 6.7 percent in the same timeframe, according to the Journal of Health Affairs.

Instead, AIR says it's the economy that affects insurance rates.

"Insurance companies raise rates when they are seeking ways to make up for declining interest rates and market-based investment losses," said an AIR report released late last year.

Still, Robert Hunter, author of the report and a former Texas insurance commissioner, thinks part of the puzzle could be tort reform.

"Legal system reform can have some long-term effect, but not in the short term," he said.

But most tort reform only addresses plaintiffs lawyers, and not defense attorneys, said Hunter.

"I wouldn't mind seeing caps on all lawyers' fees," said Hunter.

"It's clear to me defense is more expensive.

And they can take frivolous action, too, like filing motion after motion."

But Hunter primarily advocates insurance reform legislation, improvement of the physician discipline system and work to reduce medical errors.

"And don't pass laws like Florida that allows doctors to point fingers and take less responsibility.

Then the rest have to be sued.

The number of lawsuits there have skyrocketed.

It turned out to be a Frankenstein."

Nevada briefly instated a medical screening panel to review cases before they went to trial in order to weed out so-called frivolous suits.

Everyone agreed the board didn't work, causing delays and additional costs.

In fact, the Nevada Trial Lawyers Association says the 123 percent jump in court filings in Clark County last year was due to a flood of cases coming out of the panel all at once.

Assembly Bill 300 would reestablish the panel in a different form.

The bill's been sent to the Judiciary Committee but has yet to be scheduled for a hearing.

The attorneys group is advocating insurance industry reform.

"We're learning in Senate Commerce and Labor what precipitated all this was St.

Paul," leaving the market, said Bill Bradley, representing the attorneys' association, during testimony before the Senate Judiciary Committee.

St.

Paul Insurance Companies was the dominant supplier of medical malpractice insurance in the state until it stopped writing such insurance nationwide.

The state sued the company last year, saying it had unlawfully modified and cancelled policies and failed to return unearned premium payments.

The attorney general, in a release announcing the suit, placed the blame for the ensuing medical malpractice crisis at St.

Paul's door.

The Senate Commerce and Labor Committee has been hearing two other medical malpractice bills, SB250 and SB122.

SB122 attempts to prevent some of what happened with St.

Paul by placing stricter controls on the insurance industry, while SB250 gives the state's insurance commissioner more power to oversee insurers.

SB250 also has provisions refining physician licensing and reporting requirements as well as giving the state board of medical examiners some additional powers to discipline doctors and requiring it, in some cases, to hold a hearing.

(Another bill, SB389, introduced last week, deals directly with the medical examiners board.)

Two doctors in the state were responsible for two-thirds of medical practice awards recently $14 million out of $22 million, according to data gleaned from the NPDB.

Nationwide, the numbers are similar, although less dramatic: 5 percent of the doctors in the U.S.

account for 54 percent of the malpractice payouts.

The legislature is searching for an answer to that problem, and all the others.

"If you're going to have a global discussion," said Sen.

Mark Amodei (RCapitol), during a meeting of the Judiciary Committee.

"You need to have a global proposal."