IHA: Illinoisans Need Legislative Action on Medical Liability Reform

Despite reported overwhelming support by the public and rank-and-file legislators for meaningful reforms to address Illinois’ medical liability crisis, legislators are reportedly being presented with a proposal – crafted by trial lawyers – that will do little and could actually worsen the crisis.

“For the past several months, the Illinois Hospital Association has been negotiating in good faith with the Governor and legislative leaders and other interested parties to reach an agreement on meaningful medical liability reform,” said IHA President Kenneth Robbins. “We offered many constructive proposals to improve the medical liability system. However, one group – the trial lawyers – has continually blocked consideration of those proposals – and has now introduced a sham proposal – Amendment #4 to SB 2239 — that
could exacerbate the crisis.”

The trial lawyers’ proposal reportedly includes apparent agency language that provides that hospital representations such as advertising may be considered in medical liability cases against hospitals even if a patient has been advised that a physician is not a hospital employee.

The current problem of hospitals being held liable for mistakes they did not cause would reportedly be perpetuated. Under this language, hospitals would reportedly continue to be drawn into medical liability cases as “deep pockets” even though they were not at fault – and medical liability costs would continue to rise.

Another objectionable provision in the trial lawyers proposal, addressing protection of physicians’ personal assets, would reportedly create uncertainty about whether a defendant would actually receive asset protection and thus could increase the number of inappropriate settlements and the cost of insurance premiums.

IHA and the Illinois State Medical Society are backing Amendment #5 to SB 2239, which includes stronger language on apparent agency reform and physicians’ personal asset protection. It also includes a provision allowing juries to be instructed that medical liability awards are not taxable.

In many cases, juries reportedly issue higher awards because they are under the mistaken impression that awards are taxable.

“We urge legislators to oppose Amendment #4 and to call on their
legislative leaders to allow a floor vote on Amendment #5,” said Robbins. “Amendment #5 is a good first step in the right direction for meaningful medical liability reform to help keep physicians in Illinois and to ensure patient access to quality health care.

“We greatly appreciate the Governor and legislative leaders for the time and personal attention that they have committed to this issue over the past few weeks,” said Robbins. “We especially applaud Sen. Frank Watson and Rep. Tom Cross for insisting that addressing the medical liability crisis is as important as finalizing the state budget. We encourage them to continue pushing for a true legislative solution to the crisis, on behalf of the people of Illinois, before the session ends.”

The crisis is reportedly hitting hospitals hard – not just in the loss of physicians or in the difficulties they face in recruiting physicians.

The annual medical liability premiums paid by the average Illinois hospital increased from $1.5 million in 2001 to $2.8 million in 2003 – an increase of 84 percent in just two years. Hospitals – 70 percent of which are self-insured – must reportedly set aside tens of millions of dollars each year to fund their liability costs.

The optimal solution that would reportedly have the most impact on keeping physicians in Illinois and enabling hospitals to recruit physicians would be a cap on non-economic damages and the use of annuities.

But as an important first step toward meaningful reform, legislation enacted this session should reportedly include several key elements – as contained in Amendment #5 to SB 2239:

— Apparent agency reform to protect hospitals liability for harms that they did not cause;
— Tougher screening process to weed out unwarranted lawsuits (currently, about 80 percent of medical liability lawsuits result in no payment to plaintiffs);
— More stringent expert witness standards;
— Protection of physicians’ personal assets.

A poll conducted this spring for IHA reportedly showed that an overwhelming majority of Illinoisans believes the state has a medical liability crisis that is jeopardizing patient access to care and that the Governor and lawmakers need to take action to solve the crisis.

The poll found that 84 percent of likely Illinois voters characterize the current state of Illinois’ medical liability system as a crisis or major problem, and more than three-quarters (77 percent) think the system needs major changes or a complete overhaul.

More than two-thirds (68 percent) of those surveyed rate dealing with the impact of high medical liability insurance rates on health care as an extremely important issue for the Governor and state legislature to address.

And 62 percent reportedly say they would be more likely to support their state legislator in this fall’s elections if their lawmaker voted for comprehensive reform.