Illinois Democrats Get Message on Medical Malpractice Reform

By | June 6, 2005

Also, Comp Deal That Imposes Fee Schedule, Ups Benefits Will Get Guv’s Signature

The latest turn in the battle over capping medical malpractice jury awards in Illinois may have the state’s trial bar singing the old Righteous Brothers tune, “You’ve Lost That Lovin’ Feelin’.’

With the American Tort Reform Association tabbing Madison and St. Clair counties its top “judicial hellholes” two years in a row and hundreds of physicians–obstetricians and neurosurgeons, in particular–retiring, quitting or moving their practices, the pressure was on downstate Democrats to do something to address the crisis. Even if that something went against the desires of a treasured lobby.

The Illinois Trial Lawyers Association gave $418,654, mostly to the Democrats who now control the General Assembly and the governor’s mansion, in 2004 alone according to the Institute on Money in State Politics. But there’s one thing that politicians fear more than losing the financial support of a reliable lobby: losing power.

That voters downstate would make health-care access a top issue was illustrated by last year’s surprising Supreme Court election results, in which a Republican supported by tort reform, doctor and business groups beat a Chicago trial lawyer for a seat encompassing the two hellhole counties.

The bill, which caps noneconomic damages in medical malpractice cases at $1 million for hospitals and $500,000 for doctors, also requires hearings for malpractice liability insurance rate increases deemed excessive or unjustified and gives the insurance director the power to reject the proposed rate.

Though House Speaker Michael Madigan and Senate President Emil Jones, both Chicago Democrats, personally opposed the bill they allowed it to go to the floor for a vote because they feared blocking it would leave some downstate party brethren vulnerable to defeat in November 2006. The number of vulnerable seats, by some calculations, would have been enough to hand control over the General Assembly back to the Republicans.

Gov. Rod Blagojevich, also a Democrat, announced he would sign the bill although he personally opposes it. A spokeswoman said Blagojevich believes the bill is necessary in order to keep doctors in Illinois, though he may also believe it’s necessary in order to keep himself in office. He is also up for re-election next year and must win a second term to best position himself for a much-rumored run at the Democratic presidential nomination in 2008.

The ITLA said it will immediately file a lawsuit to block the law, and they may have a good chance of getting the legislation ruled unconstitutional given that the Illinois Supreme Court threw out a bill capping awards in all civil cases at $500,000 in 1997. Doctors, business groups and insurers hope that this more limited will pass the top court’s smell test, though it seems unlikely that insurers will rush in to write new business given the precarious legal situation and prior-year loss development.

That’s not including the rush of lawsuits that usually accompanies any major reform. In the six days after the deal was announced during a bipartisan news conference (at which Blagojevich, Madigan and Jones were noticeably absent), 58 medical malpractice lawsuits were filed in Cook County, according to the Chicago Sun-Times. It was four times the usual number, according to reporter Steve Patterson.

The bill also requires any malpractice lawsuit to include a report by a consulting physician attesting that the plaintiff’s claims merit a trial. It would also up the number of state medical investigators and force doctors to disclose on a central Internet site any criminal convictions, malpractice awards or disciplinary actions taken against them in the previous five years.

Doctors and hospitals pushed especially hard for the bill, especially given that the state doctors’ mutual insurer, ISMIE Mutual Insurance Co., covers the vast majority of doctors in the Land of Lincoln. The Illinois State Medical Society and the Illinois Hospital & Health Systems Association gave a combined $1.5 million, mostly to Republicans, in 2004 according to the Institute on Money in State Politics.

Everyone on the pro-tort reform side wanted even lower caps–$250,000 in pain-and-suffering damages against a doctor is the figure most states that have passed malpractice award limits have settled on–but were glad to get what they did given the hostile political environment.

“While we would have liked to have seen a lower cap on pain-and-suffering awards, we are pleased that Illinois state leaders are finally taking action to control the skyrocketing costs of non-economic damage claims,” said Greg LaCost, senior counsel for the Des Plaines, Ill.-based Property Casualty Insurers Association of America. “Without the caps, consumers in Illinois were losing skilled and experienced physicians to neighboring states. This measure will help stabilize the market and bring physicians back to Illinois.”

Comp deal also struck
Meanwhile, labor and employer groups dominated the discussions on a workers’ compensation deal that has passed the General Assembly and will be signed by Blagojevich. The bill imposes a medical fee schedule for benefits in Illinois–a first for the state–though it is not the cheaper Medicare schedule insurers wanted and are accustomed to dealing with in other states.

The agreement, the first change to the state’s comp system in three decades, also increases benefits while creating an anti-fraud unit that will target both workers and employers who scam the system. The minimum benefit for a worker killed on the job will go up to $500,000 for 25 years from $400,000 for 20 years.

Jeffrey Junkas, a spokesman for the Chicago office of the American Insurance Association, called the legislation “a mixed bag,” and said the likely effects on the workers’ compensation marketplace are unclear.

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