Wisconsin makes another run at damage caps

Physicians are advocating a measure they hope will pass constitutional muster.

By Mike Norbut — Posted Nov. 14, 2005

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Only a few months have passed since the Wisconsin Supreme Court struck down the state's noneconomic damage caps in medical liability cases, but legislators are looking to redo what the legal system has undone.

The Wisconsin State Assembly passed a bill last month creating a two-tiered cap system for noneconomic damages, a design supporters are hoping can pass constitutional muster. The bill would set a ceiling of $550,000 for a child younger than 18 and $450,000 for an adult.

In July, the state's high court declared Wisconsin's noneconomic damages cap unconstitutional because it violated plaintiffs' rights to equal protection guarantees. The 4-3 decision wiped out the state's long-standing liability protection and shocked the medical community.

Since the court's ruling, "we've been working diligently to convince legislators that the cap is important as an access-to-care issue," said Susan Turney, MD, executive vice president and CEO of the Wisconsin Medical Society. Without a cap, "we will see physicians start to restrict services," she said.

The AMA identifies 20 states as being in a medical liability crisis, marked by escalating insurance premiums that are forcing physicians to retire early, stop seeing high-risk patients or move to a different state with a healthier liability climate. Meanwhile, 23 states are showing signs that they soon could be headed into deep trouble, while Texas is classified as a state in which effective reforms have stopped its crisis, according to the AMA. Doctors saw Wisconsin as one of the six states with greener pastures because of its cap and stable liability environment, but they are now worried the state will drift into a crisis.

The state originally established a $1 million cap in 1985, but the law expired in 1991. In 1995, the state enacted a new $350,000 cap that was regularly adjusted for inflation. It stood at $445,775 at the time of the court's ruling. But before the ruling, the cap had withstood several constitutional challenges in the past decade, which gave physicians even more confidence about Wisconsin's liability climate.

Officials from the Wisconsin Academy of Trial Lawyers did not return calls seeking comment, but on its Web site, the organization urges members to call legislators to oppose the new bill. The organization celebrated the Supreme Court's decision last summer, saying the ruling was a victory for patients.

At deadline, Wisconsin's Senate had not voted on its version of the measure. If the Senate version passes, however, physicians are hoping the support from lawmakers will compel Wisconsin Gov. Jim Doyle to sign the bill. A spokeswoman for the governor said Doyle has not yet indicated what he will do, but he has expressed reservations about the measure's design and whether it would stand up under a constitutional challenge.

Doctors, however, are confident about the current legislation. The new bill mimics award limits found in the wrongful death statute that were recently declared constitutional, Dr. Turney said. Physicians also point out that the new measure does not limit the amount of economic damages a patient can recover. As opposed to the last cap, the limits in the new bill would not be adjusted for inflation, Dr. Turney said.

Physicians and legislators are trying to walk a fine line between satisfying court opinion and implementing an important tort reform. Trial attorneys have argued that caps discriminate against the most severely injured and youngest victims. But actuarial evidence shows that "when you have high caps, above $550,000, it's the same as having no caps" in terms of how it helps to hold down liability insurance premiums, Dr. Turney said.

"All we can do is look at what's going on in other states," she said.

Physicians found themselves lobbying for a new cap as a result of a case involving a child born with obstetric brachial plexus palsy. The boy, now 8, and his parents won their case in 2002, when a jury ruled that the physician in the case had been negligent when delivering the baby, causing deformities and some paralysis to the boy's right arm.

The jury awarded $403,000 in future medical expenses and $700,000 for past and future noneconomic damages. Since the noneconomic damages cap at that time was $410,322, the physician and other defendants asked the court to reduce the award. The plaintiffs challenged the cap's constitutionality, and it wasn't until the case reached the Supreme Court that their challenge was upheld.

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