This past week I've taken advantage of my access to a press pass to sit in on some fascinating meetings in the Capitol. From Judiciary A meetings on "both sides of the hall" (as we insiders say) to the floor of the House of Representatives, I've watched our democracy in action. And, while some might be inclined to call this particular show of democracy a train wreck, I've gotten a little too much of a "Mr. Smith Goes to Washington" feel to completely denigrate the process.
The special session was called because of the impasse between the House and Senate (and governor) that is focused on non-economic damage caps—capping the damages that a jury can award for "pain and suffering." That's as opposed to economic damages, which cover lost wages and medical bills. Proponents want the caps because they make the liability faced by an insurance company (in a medical malpractice case) or a by a business or individual (in a general liability case) more predictable.
At the same time, I've been studying tort reform rather closely—at least at the concerned-citizen level, if not quite at the doctoral-thesis level. And I'm left with some conclusions that I'd like to share with you:
• There is a problem, both with medical malpractice insurance rates and general liability tort cases. However, they are, by and large, not the same problem.
• In other states, capping non-economic damages alone has not often lowered medical malpractice insurance rates, particularly without some sort of insurance reform or regulation. That includes California.
• Insurance companies, like anyone else, will use government regulation to increase profits where possible.
• A limited approach of tort reform is a good idea, particularly reforms that cut down on the risk that an attorney is taking advantage of a jury pool or judge to get easier or larger verdicts.
Unfortunately, some legislators believe in the non-economic damage cap like it is a low-carb diet. They've got tort-reform fever, somehow believing that it is a one-stop solution to medical malpractice insurance, job creation and—perhaps the biggest problem in the eyes of conservative legislators and many Mississippians—wealthy trial attorneys (who tend to donate money to Democrats).
But what if it's just a fad solution?
California enacted both a cap in 1975 and insurance reform in 1988. Just this year, the California Supreme Court ruled that certain types of medical malpractice—in elderly care and 24-hour in-patient facilities—could be exempt from the cap.
Scan the Web, and you'll see opinions from all sides of this issue—and if you're like me, you'll agree with little bits of all of them. Some of them come from Opposite World: In Missouri, Gov. Holden, a Democrat, vetoed the tort-reform legislation because it didn't include insurance-reform components. The Kansas City Star praised him for his leadership.
Maybe they're just "liberals" up there in Missouri, so we can write 'em off as idiots. Or maybe there's more to this tort thing than we get at first glance from lobbyists and state media.
While I have a great deal of trepidation about caps—I think that uncertainty is an important part of the tort system because it tends to make one more cautious and, thus, safety-minded—I can see more logic in a medical malpractice cap than in a general liability cap. But any cap needs to be more flexible—and higher—than Mississippi lawmakers made it in 2002. In Alaska, for instance, medical malpractice non-economic damages are capped at a multiple of the victim's life expectancy—Utah and other states tie the cap to inflation.
Indeed, the Senate did something interesting when it adopted House Bill 3 this week—it allowed a $500,000 cap that can be exceeded if five times your medical bills are more than $500,000. It still caps at $1 million, which it shouldn't; but if this approach is good enough for general business, why isn't it good enough for medical malpractice?
If you need to cap medical malpractice non-economic damages, I have no idea why the Senate insists on placing disfigurement under the cap, which they've done repeatedly in bill after bill this session and special session. That just seems mean-spirited. The point of "pain and suffering" is to give retribution to a person because he or she can't live a normal, happy life due to someone else's negligence. Disfigurement is the most severe example, and it should be compensated.
Mississippi has a $500,000 cap for medical malpractice, and it has had a nominal effect—if any—on the skyrocketing insurance premiums paid by doctors and patients alike. The studies—by respectable sources—show that the insurance companies keep raising rates after caps. Congress' General Accounting Office found that the medical malpractice "crisis" was overblown. Only combined with other reforms—both tort and insurance—will the package make a difference for real Mississippians.
Now, the Senate and Governor want a non-economic damage cap for general business liability, including product and pharmaceutical liability. Punitive damages are already capped in Mississippi. Heck … such a non-economic damage cap is hardly even a fad, yet—it puts Mississippi on the cutting edge. It's an overreaction to the "perception" that Mississippi is bad for business and that businesses are deciding not to locate in Mississippi because there's no cap.
That's not to say that some tort reforms don't make sense—most states have reformed "joint and several" liability so that parties pay according to their fault instead of their ability to pay. And reforms that stop "venue shopping" are reasonable and have proven effective in other places.
Even after this special session is over, whatever the outcome, I don't think the reforms debate will be behind us. We'll need to look into reforms in the insurance industry—both in medical malpractice and other types, such as our personal medical policies. The cost of medicine has gone up 75 percent over the past decade, despite managed care and the wonders it was supposed to bring. With Baby Boomers aging, it's going to be an overloaded and expensive system without dramatic change—sooner or later it's coming, on both the state and national level.
In our cover story this issue, Donna Ladd and I have tried to present a balancing look at the continuing tort reform (and burgeoning insurance reform) debate, while Ayana Taylor files a story on the other issue of the session—Voter ID. Even if you have stopped eating grits and bread because it's a surefire way to lose unwanted pounds, I hope you'll enjoy our coverage from the Capitol as much as we enjoyed bringing it to you.
Todd Stauffer is publisher of the Jackson Free Press.