Legislative Update

2003 Medical Liability Bill

Signed into law by Gov. Jeb Bush, August 14, 2003
Malpractice insurance premiums are expensive.  Specialties such as obstetrics and anesthesiology pay particularly high premiums, driving many practitioners from their field of choice.  High premiums are blamed on enormous awards from malpractice suits, especially those from high visibility cases which range in the tens and hundreds of millions of dollars. While the average payout is closer to $25,000, the perception of law suits run amok persists, justifying the insurance industry’s increasingly higher premiums.  The cost of paying high insurance rates is, in turn, passed on to patients.  So, large malpractice awards are blamed for a large part of the rising cost in health care, both the cost of services and the cost of premiums for patients’ health insurance. 

While the link and impact of malpractice suits on your insurance rates may be several steps removed, legislatures around the U.S. are equally concerned about competent doctors leaving practice or insurance companies simply choosing to discontinue coverage.  To stem the growing problem, the Florida Legislature passed and Governor Bush signed bill SB 2D which addresses medical liability.

The following are key provisions:

  • The bill imposes a cap on non-economic damages from a medical malpractice suit.
 
  • $500,000 cap on non-economic damages from physicians and health care providers, up to $1,000,000 aggregate
 
  • no claimant can receive more than $500,000 from a claim no matter how many health care providers are involved
  • no health care provider is liable for more than $500,000 no matter how many claimants are involved in a suit
 
  • $750,000 cap on non-economic damages from a non-physician category, including hospitals and HMOs, up to a $1.5 million aggregate
  • The cap can be pierced in egregious situations such as wrongful death, vegetative states or catastrophic injury (for example).  Even so, limits, though higher, are still imposed.
  • The bill imposes a cap on emergency room care.
 
  • $150,000 cap on non-economic damages from physicians and health care providers, up to $300,000 aggregate
  • $750,000 cap on non-economic damages from a non-physician category including hospitals and HMOs, up to a $1.5 million aggregate
  • The bill makes changes to current malpractice insurance practices.
 
  • Malpractice insurance rates will be frozen as of July 1, 2003, until no later than January 1, 2004.  In the interim, the Florida Office of Insurance Regulation (OIR) is to determine the expected savings as a result of this legislation.
 
  • Insurance companies are to file new, presumably lower rates based on the reduction factor.
  • Insurance companies must file rates for review by the OIR every year.
 
  • Physicians can join to form commercial self-insurance funds.
  • Physicians can choose to self-insure.
  • The bill provides procedures to insure patient safety such as hospital safety plans and committees, patient notification of adverse incidents and special training in patient safety and misdiagnosis for medical students and physician certifications, and physician discipline.

The new legislation is over 90 pages long.  A more comprehensive summary can be found at the Florida Medical Association’s website, www.fmaonline.org/tort/cap_summary.html.  The full text of the legislation can be found through the flsenate.gov site at http://election.dos.state.fl.us/laws/03laws/ch_2003-416.pdf.

While new medical liability legislation has finally been enacted after a year-long battle initiated by Gov. Bush, the impact of the law may be a long way off.  Analysts anticipate judicial challenges in the near future – ironic, given that the legislation is meant to curtail the expense passed on to consumers of costly court battles.

 
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