Legislature(2005 - 2006)BELTZ 211
03/01/2005 01:30 PM LABOR & COMMERCE
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SB 67-CLAIMS AGAINST HEALTH CARE PROVIDERS CHAIR BUNDE announced SB 67 to be up for consideration. SENATOR SEEKINS said there is some concern about whom the bill covers and that it is intended to cover a broad scope of health care providers including nurse practitioners, physician assistants and doctors. DONNA MCCRADY, Alaska Academy of Travel Lawyers, opposed SB 67, but she immediately dispelled the idea that this is a case of lawyers against doctors. She is a consumer of health care and a citizen in this state and cares about physicians who are working here. She is against the bill because it is a solution in search of a problem. The state already has a damage cap of $400,000 for physical injury and $1 million cap for serious permanent physical injury or severe disfigurement. She understands the lower figure has been proposed because of concerns about the low number of physicians practicing in the state. But, Alaska has always had a low number of physicians and data shows that it is increasing. She has found anecdotally no link between the number of doctors in the state and the amount of the non-economic damage cap. However, there is an issue with the lack of a residency program. Data shows that any problems doctors are having with insurance premiums have to do with the stock market and nothing to do with medical malpractice payout. Particularly in this state, we don't have a crisis in this state with medical malpractice - in premiums or with payments or settlements.... Again, we have damages capped in this state.... Let me explain from a practical matter...there really aren't that many lawyers in Alaska practicing in the area of medical malpractice and the reason why is it's a very technical area and it's very expensive to bring these cases. If you put a cap of $250,000 on non-economic damages, I can tell you right now that medical malpractice claims lawyers are not going to be able bring cases on behalf of children, on behalf of people who are retired, on behalf of stay-at-home spouses. The reason why is people who are victims of medical errors or medical malpractice that fall into those categories - those are folks whose damages are going to be mainly non-economic value. Unfortunately the court doesn't put a lot of economic value on the lives of children, stay-at-home spouses or retired folks. It just doesn't and sometimes just the cost - it's not the fees - can be over $200,000. So, no practitioner is going bring a case on behalf of somebody in one of those categories who is a victim of malpractice because they're not going to be able to afford to do it. It's not going to make any economic sense. So, you're going to be cutting out three categories of Alaskan citizens that I can think of from even having access to the court system if they were to be victims of malpractice. Further there is already standards of proof for bringing malpractice cases, more so than other kinds of negligence cases. For instance, if I bring a negligence case, I have to hire experts and just by a practical matter, I'm going to have hire experts who are in the Lower 48 in order to bring a case forward. That can be quite costly. She was also concerned that she didn't see an exemption for gross negligence or reckless behavior in the bill. 2:01:38 PM PAT LUBY, Advocacy Director, AARP, believes that accidents do happen - even to skilled health professionals. AARP believes the Legislature should focus on prevention, not on damages. The tort system encourages providers to cover up mistakes to avoid lawsuits rather than report errors and learn how to prevent them.... If someone is hurt by a medical mistake, they are entitled to some fair compensation. What is more important is to make sure errors are reported so that we can learn how to prevent them in the future. AARP thinks that $250,000 damages would be too low for non-economic damages. Older people who have limited income potential based on life expectancy will get less in economic damages than younger persons who are victims of a similar error. The Institute of Medicine (IOM) has proposed testing non- judicial no-fault alternatives to the tort system for medical errors. It might foster fair compensation and error reduction and that should be the real goal of consumer-oriented reform. Under the IOM approach, compensation would be based on avoidability of errors rather than negligence. It recommends preset schedules for compensation with reasonable limits that may help stabilize malpractice premiums. Providers would be required to report errors and make prompt compensation payments. Mandated reporting of errors would help experts in finding system-wide ways to prevent them in the future. The system would continually improve patient safety; with fewer errors, the cost of compensating injured people would eventually decline. 2:03:14 PM CATHY GIESSEL, Nurse Practitioners' Association, said she had no further comments. 2:04:00 PM SENATOR ELLIS moved Amendment 1. 24-LS0393\A.1 Bullock 6/10/05 A M E N D M E N T 1 OFFERED IN THE SENATE BY SENATOR ELLIS TO: SB 67 Page 3, line 1: Delete "$250,000" Insert "$850,000" Page 3, line 17: Delete "$250,000" Insert "$850,000" CHAIR BUNDE objected for explanation. SENATOR ELLIS explained when people from other states have used California as an example of how good a cap works, they have been laughed out of the building. He changed the amount of the cap to reflect a reasonable CPI since 1975 in Alaska and in today's dollars to $850,000. Indiana and Virginia have a current cap of $1 million; Maryland has an $805,000 cap. Industry players have said that caps don't help doctors' premiums go lower. That led him to think, if there was going to be a cap, that it should reasonable reflect the cost of living and economic circumstances over the many years. His main concern was that a lower cap would limit access to counsel for legitimate cases. SENATOR SEEKINS asked what the California cap is today. SENATOR ELLIS didn't know, but if left at the 1975 standard, it would be woefully out of date. SENATOR SEEKINS reflected that many states, as well as the federal government, are considering a $250,000 cap on non- economic damages. The bill deals with non-economic damages in two sections. The first cap is at $250,000; if it's severe, it goes to $1 million. Alaska doesn't have a definition of "severe" in its statutes, so the court in one of its cases imposed the definition - if it embarrasses someone, it's a severe damage. This is the first step, but it does not say that's all that can happen. If the accident gets to a certain threshold of severity, it immediately goes to the $1 million cap. If three quarters of all Alaska citizens will not be able to bring a case if the first step of liability is reduced to $250,000 (from $400,000) the problem is worse than he thought it was. CHAIR BUNDE noted there was no further discussion on the amendment. Senators Ben Stevens, Seekins and Chair Bunde voted nay; Senator Ellis yea; and Amendment 1 failed. SENATOR BEN STEVENS moved to pass SB 67 from committee with individual recommendations. Senators Seekins, Ben Stevens and Chair Bunde voted yea; Senator Ellis voted nay; and SB 67 moved from committee.