California Cap on Medical Malpractice Awards May Change

When patients file a lawsuit alleging doctor or hospital negligence, the medical malpractice award generally reflects compensatory damages for pain and suffering, among other losses. In California, the maximum amount of damages that may be awarded for pain and suffering has long held steady at $250,000. If consumer activists have their way, that cap could soon change.

Origins of the proposal

Robert Pack, a technology entrepreneur who resides in the San Francisco Bay area, has a personal stake in the proposed compensation increases. About a decade ago, his pregnant wife and two young children were walking to an ice cream shop. A car ran over the curb and struck the family, killing both children and the unborn twins Pack’s wife was carrying. The driver was found to be intoxicated with a mixture of prescription drugs and vodka. Despite her attempt to leave the country to escape justice, the driver was sentence to 30 years.

Pack wanted to file a medical negligence lawsuit against a medical group that had prescribed the driver excessive amounts of painkillers; however, few lawyers were interested in taking the case because of the maximum medical malpractice award. “Attorneys will tell you it’s going to cost more than $250,000 to navigate three years of court proceedings and hire experts,” said Pack. Although Pack and the medical group did eventually agree upon a settlement, it was for less than the maximum. “I personally feel that the loss of my two children is worth a lot more than $250,000,” Pack said.

If Pack’s children had survived, yet required extensive and/or ongoing medical treatments, Pack could have possibly received additional compensation. The pain and suffering compensation cap does not place any limits on compensatory damages for economic losses or healthcare expenses.

Proposal calls for inflation adjustments  for medical malpractice awards

The original cap on a medical malpractice award was established in 1975 and signed by Gov. Jerry Brown. The new initiative calls for inflation adjustments. First, the cap would be elevated to $1.1 million, which equates to $250,000 adjusted for inflation over the past four decades. The proposal would also implement annual inflation adjustments.

“All we’re really talking about is putting the law back in place where it began,” said Chris Lehane, an initiative strategist who is spearheading the bill along with Pack and other consumer activists. The ballot initiative, which was submitted to the Attorney General late in July 2013, is awaiting the AG’s title and summary. Following that, proponents hope to gather enough signatures to enter it into the November 2014 ballot.

Initiative may change hospital protocols

The proponents of the initiative have also gone a step beyond adjusting the maximum medical malpractice award. The proposal would require physicians practicing in hospitals to pass drug and alcohol testing. According to Pack, “Patients have a right to know that doctors they’ve entrusted with their lives are not abusing drugs or alcohol.” Physicians would also be required to follow a patient’s prescription drug history with a state database in an effort to avoid so-called “doctor shopping” and excessive prescriptions.

Opposition cites concerns over accessible care

The initiative has met with opposition from healthcare providers and insurance companies. Healthcare professionals have expressed the concern that doctors will leave California to practice in another state or they will retire altogether, potentially leaving some areas with a shortage of physicians. Insurance company representatives have claimed that medical malpractice premiums will skyrocket, which may potentially drive up the cost of care.

However, the president of Consumer Watchdog, Jamie Court, who has cosponsored the proposed initiative, claims that the cost of malpractice premiums and claims are negligible compared to the sum of all healthcare costs. Court maintains that it is “mathematically impossible” for medical malpractice reform to affect the cost of healthcare.