State tort reform ballot wins set stage for further battles

Voters approved physician-backed initiatives in Florida, Nevada and Wyoming. Doctors hope the approach spreads to other states.

By Tanya Albert Henry — Posted Nov. 22, 2004

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Doctors in four states mired in liability insurance problems took tort reform directly to voters on Nov. 2. They were met with victory in some states but more battles are expected.

Nevada physicians had the most to celebrate. Citizens passed California-style reforms that are set to go into effect immediately. The package includes a strengthening of the state's existing $350,000 noneconomic damages cap. At the same time, they rejected two amendments advocated by trial lawyers.

Florida physicians cheered a win for their proposal to limit attorney fees but are left figuring out the impact of two trial-lawyer-backed initiatives that also passed.

Results were mixed in Wyoming, where voters backed the idea of a medical review panel but rejected a constitutional change that would allow a noneconomic damages cap. In Oregon, voters narrowly defeated a constitutional amendment that would have enacted a $500,000 noneconomic damages cap.

The American Medical Association lists all four states as being in the midst of a medical liability insurance crisis that has physicians leaving the states, retiring early or cutting back on services because they can't afford or obtain liability insurance.

Physicians at the state and national level have been pushing tort reform, including noneconomic damages caps, as a way to stabilize insurance rates for years. The AMA has been fighting for Congress to pass a $250,000 cap. Trial lawyers disagree with this approach and instead have backed reforms that include insurance industry changes and patient safety measures.

Doctors in Florida and Nevada hope that their successes will inspire physicians in other states to go directly to voters.

"This has shown that when physicians can get united and take a message to patients, they can affect the outcome," said ophthalmologist Rudy Manthei, DO, who led Keep Our Doctors in Nevada, a coalition that supported the doctor-backed initiative.

The win in Florida is a clear message that doctors are a force to be reckoned with, said Frank D. Mastandrea, MD, Hillsborough County Medical Assn. president.

Physicians in both states have fielded calls from colleagues nationwide who are curious about how the campaigns were developed.

"My guess is that other states as hard hit as Nevada will look at what we did and how we did it," said Lawrence P. Matheis, executive director of the Nevada State Medical Assn. "It also gives momentum to the AMA's effort at the national level."

The AMA said it would continue the push for changes at the federal and state levels. "We will be relentless in our fight to enact reasonable reforms that allow patients access to the courtroom without sacrificing Americans' access to medical care," said AMA President John C. Nelson, MD, MPH.

Nevada strengthens existing reforms

Nevada physicians are optimistic that the new tort reform package will keep more physicians in the state. They believe it will make recruiting new doctors easier.

Nearly 60% of Nevada voters approved the measure. Along with strengthening the existing damage cap, it will limit attorneys' fees.

More than 60% voted against trial-lawyer-backed measures. One would have rolled back insurance rates. The other, touted as preventing frivolous lawsuits, would actually have raised the bar for punishing lawyers for such suits, and banned limits on contingency fees and damage awards, according to the NSMA.

Doctors campaigned hard against those initiatives. They argued that rolling back rates would discourage insurers from coming to the state and that other proposed reforms wouldn't end frivolous lawsuits.

"This is just an excellent day for health care in Nevada," said Michael P. Colletti, MD, president of the Clark County Medical Society. "If we did not do this, there is no way doctors would want to come here."

Trial lawyers disagree. They say insurance companies duped Nevada's citizens.

"Patients have given up more rights," said Gail Tuzzolo, campaign manager for "Yes on 4 and 5," a group that backed the trial lawyers' measures. "Doctors' rates won't go down."

The doctors' ballot initiative was not a constitutional amendment, so physicians expect challenges. They predict that courts will uphold the measure. Trial lawyers think judges will declare it unconstitutional.

Florida sorts out what's next

In Florida, doctors say passage of their constitutional amendment to limit attorneys' fees will put more money in patients' pockets and make lawyers less likely to take nonmeritorious cases.

"We are very pleased that Florida did the right thing, even though trial lawyers tried to defeat it," said Robert Entel, MD, president of the Pinellas County Medical Society and the Florida Radiological Society.

Patients will get 70% of the first $250,000 awarded and 90% of the remainder of the award. Attorneys would still get payment for court and witness expenses.

The Academy of Florida Trial Lawyers did not return calls before press time. But elsewhere, the group publicly said it is considering a lawsuit challenging the constitutional amendment.

Also in Florida, though, two trial lawyer ballot initiatives passed. One measure strips doctors of their medical licenses if they have three medical malpractice judgments or disciplinary actions against them. The second lets patients see medical records and reports connected with "adverse" incidents, including peer review documents.

Physicians already have reported fallout, including some doctors resigning from peer review boards and at least one hospital suspending peer review for now. Other doctors have reported being asked for records.

"I'm optimistic that [the physicians' amendment] will give patients of Florida what they deserve if they are injured by true negligence," said John P. Rioux, MD, immediate past president of the Charlotte County Medical Society. "I'm cautiously optimistic that [the lawyers' amendments] will be able to be mitigated by the Legislature."

There are questions around how the two trial lawyer measures will play out.

Unlike the doctors' measure, the lawyers' initiatives require approval by the Legislature and governor before they can take effect, said Sandra Mortham, the Florida Medical Assn.'s executive vice president.

"I feel confident they are not going to do something to harm doctors," she said.

The Florida Hospital Assn. has filed two lawsuits seeking injunctions against the trial lawyer amendments. "The amendments are so broad and so vague, it's confusing on how they would be implemented," said Bill Bell, FHA's general counsel.

Going forward in Wyoming and Oregon

In Wyoming, voters passed a physician-backed measure that allows the Legislature to create a medical review panel that would weed out nonmeritorious lawsuits. But they voted down a ballot question that would have allowed lawmakers to limit noneconomic damages that could be awarded in medical malpractice cases.

"It's a little bit of a mixed message," said Wendy P. Curran, Wyoming Medical Society's executive director. "Our Legislature will be dealing with limited options, and we believe it will result in limited reforms."

Wyoming physicians will continue to discuss ways to stabilize insurance costs, including periodic payments on large awards, an excess liability fund and statutes of limitation, Curran said.

In Oregon, voters similarly rejected a measure that would have amended the constitution to restore a $500,000 noneconomic damages cap that was in place for more than a decade before the state Supreme Court said the Legislature didn't have the authority to enact a cap.

While disappointed with the defeat, doctors there see a cap as just one piece toward solving the puzzle of liability problems, said Jim Kronenberg, Oregon Medical Assn. spokesman. Doctors plan to go to the Legislature next year to seek reforms such as an excess liability fund, stronger expert witness laws and periodic payments for large awards.

"We need some help, because the problem is just not going to go away," Kronenberg said.

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Tort reform tallies

Four states had ballot initiatives involving tort reform. Here's the vote breakdown.

Intitiative For Against
Limit attorney fees 63.6% 36.4%
Give patients the right to know about
adverse events
81.1% 18.9%
Create a "three-strikes" rule against doctors 71.1% 28.9%
Strengthen noneconomic damage caps 59.4% 40.6%
Roll back insurance rates 34.7% 65.3%
Penalize lawyers who file frivolous lawsuits 37.2% 62.8%
Limit noneconomic damages 49.4% 50.6%
Medical review panel 53.0% 47.0%
Limit noneconomic damages 49.3% 50.7%

Source: State boards of election

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