Federal Tort Reform Measure Advances

April 2, 2012
by Sammons & Carpenter, P.C.

Last week we discussed the efforts by a local lawmaker to mandate that each state across the country, including Georgia, abide by federal standards regarding certain legal principles in medical malpractice lawsuits. Unfortunately, last Monday in Washington the House passed Georgia Representative Phil Gingrey's bill that would set a cap on medical malpractice awards. The specifics of the bill include a $250,000 cap on economic damages, a limit on punitive damages to two times the amount of economic damages or $250,000 (whichever is greater), and a sliding-scale limit on attorney's fees in medical malpractice cases. The final vote in the House was 223 for, 118 against. lady justice.jpg

As noted in the previous post, Representative Gingrey says that this is necessary to stop "frivolous lawsuits" and increasing costs of liability insurance. There are skeptics of this on both sides of the aisle, though, and the bill still faces a tough battle in the Senate. President Obama has already indicated that even if it passes, he intends to veto the measure. Representatives of the White House said, "The administration opposes placing artificial caps on malpractice awards which will prevent patients and other claimants who have been wrongfully harmed from receiving just compensation."

Aside from the federalism issues as discussed in the previous post, this whole argument may be missing the point if the goal is to lower the cost of liability insurance to doctors. Last month, the American Association for Justice issued a report showing that medical liability insurance companies have invented this "crisis" to justify charging higher premiums, even though the companies are more profitable than ever. The insurance companies want everyone, including doctors, to believe that the reason for higher premiums is expensive malpractice litigation. But a closer look at the numbers show that while the amount paid out by the companies on average for each claim did increase, it was a gradual increase with no sudden spike in terms of dollar amounts. And the number of claims the companies paid out actually decreased. This resulted in the money being paid out remaining stable, but the premiums skyrocketing regardless.

Our Atlanta medical malpractice attorneys understand that insurance companies projected huge losses that did not materialize. But when the profits came rolling in, the companies failed to roll back malpractice insurance premiums along with it. The American Association for Justice report showed that the top ten medical malpractice insurance companies had a profit margin twice as high as the average profit for the 50 top Fortune 500 companies. Only one Fortune 500 company had average profits as high as the ten top medical malpractice insurance companies. So doctors are losing money on high premiums, patients are losing their fair trial rights when they are negligently injured, and the only group winning is the insurance companies.

It is important for more to community members to be made aware of this insurance situation. Whatever side of the health care debate you are on, the negligently injured patients are not to blame for high health care costs. If you or a loved one has been the victim of medical malpractice, let the experienced Atlanta medical malpractice attorneys at Sammons & Carpenter help you. Call at 404-814-8949 or fill out our confidential case evaluation form online to schedule a free consultation.

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