Iowa governor might not sign tort reform bill

Iowa physicians cleared two of the three hurdles needed to enact a $250,000 cap on noneconomic damages awarded in medical malpractice lawsuits. But it looks as if the third obstacle -- the governor's signature -- will be a stumbling block.

After failing to pass tort reform by one vote in early April, the Iowa Senate April 12 voted 27-21 to pass a bill that would cap the amount injured patients could receive for pain and suffering. The House already had passed the measure.

At press time, it was a long shot that Iowa Gov. Tom Vilsack would sign the bill into law.

"The governor is a past president of the trial lawyers association," said Iowa Medical Society President Tom Evans, MD. "We knew that going in, but we are hopeful it will be signed." Dr. Evans said Iowa doctors need the relief.

The AMA lists Iowa as one of the 25 states showing problem signs that other states have had before heading into a full-blown medical liability insurance crisis.

Iowa doctors say the situation worsened in late 2003 when doctors statewide started seeing large increases in insurance premiums.

"This year we thought Medicare was going to be the big issue," Dr. Evans said. "But once [Medicare legislation] passed, my home phone started ringing off the hook when physicians started receiving their insurance bills."

Increases ranged from 50% to 200%. And it wasn't just the obstetricians, neurosurgeons and other high-risk specialists who saw large jumps.

"We heard from the whole spectrum," Dr. Evans said. "There isn't any place to pass along the costs. ... We all had problems, but when this hit the fan, it was the final thing that pushed many over the edge."

Iowa passed a number of tort reforms over the past two decades in an attempt to keep liability insurance rates stable. But a noneconomic damages limit wasn't among them, and like other physicians across the nation, Iowa doctors see the $250,000 cap as a key component to keeping insurance available and rates affordable.

Vilsack, however, has voiced concerns about a noneconomic damages ceiling. He doesn't think it is a solution to the problems that Iowa doctors face. The governor is "not likely" to sign the legislation, said Matt Paul, his spokesman.

"This bill is not a fix," Paul said. "The governor understands the importance of the issue and the impact it has in rural areas ... but we are looking for a broader solution."

Paul said insurance reform is one area Vilsack would like the Legislature to consider.

The Iowa Trial Lawyers Assn. agrees there is a problem but argues that award limits aren't the answer. Insurers increased premiums so they could maintain a profit margin after interest rates dropped and investments didn't produce the high returns they had in the 1990s, ITLA President Bruce Braley said in a statement.

"The Republican majority in the Iowa Senate has just voted to trample the rights of people whose lives are devastated by medical malpractice," Braley said. "Capping damages to rein in insurance premiums makes as much sense as re-siding a house to stop the roof from leaking."

Other states consider reforms

In Missouri, the House and Senate hashed out a compromise on a bill that would lower the current $565,000 noneconomic damages cap in medical malpractice lawsuits. The House approved the compromise bill April 19. At press time, the Senate was expected to approve it.

The compromise measure calls for a $400,000 cap that would not be adjusted annually for inflation. The bill also would tighten the guidelines regarding where lawsuits can be filed by requiring plaintiffs to file them in the judicial circuit where the alleged incident occurred.

The bill would still need the governor's approval to become law.

In Oklahoma, a 23-member bipartisan joint committee on lawsuit reform began hearings on April 15. Committee members heard testimony about caps on noneconomic damages. The AMA is among the groups that offered testimony.

In all, four public hearings will be held before members write the final version of lawsuit reform legislation. Additional topics include other medical malpractice law changes; prevention of frivolous lawsuits; and liability insurance, class action lawsuit and civil justice reforms. The hearings are expected to be completed on May 6.