LEGISLATIVE REFORMS

In June of 2003 the Texas legislature passed one of the nation's most comprehensive and far-reaching medical liability reform bills. Had they not done so the consequence might have been dire for patients and doctors across the state. Patients would have lost their doctors. Doctors would have lost their insurer.

Our urban areas would have become an even greater dumping ground for trauma and high-risk cases. Hospitals likely would be facing a liability rate hike of 50 percent or more, and sadly, many patients would be forced to travel great distance to get the care they need.

Fortunately, the Legislature acted, and today Texas patients, doctors, and hospitals are reaping healthy benefits from the passage of lawsuit reform.

Lawsuit filings are down. Physician recruitment is up. Texas patients are experiencing better access to health care and hospitals are taking their liability savings and reinvesting them in patient services and charity care.

Chief among the 2003 reforms was the passage of a non-economic damage cap, widely regarded as the lynch pin of the reform package.

NON-ECONOMIC DAMAGE CAP

Texas law now establishes a $750,000 stacked cap for non-economic damages in a health care lawsuit. The capped figure varies depending upon the variety of defendants in a suit. Physicians are capped at $250,000 exposure for non-economic damages. Hospitals have a $250,000 cap and an additional $250,000 non-economic damage cap applies if a second, unrelated hospital or health care institution is named in the suit. The cap is applied on a per claimant basis with no exceptions and no adjustment for inflation. Past and future medical bills, lost wages, custodial care and prejudgment interest remain uncapped.

DEATH CAP CHANGES

Total damages in a wrongful death case are capped at $1.81 million plus medical bills. Punitive damages and prejudgment interest are included within the cap. The death cap applies per claimant thus reducing or eliminating the “stacking” of multiple death caps by suing multiple defendants.

SETTLEMENT CREDITS

Current law allows defendants to have their judgment reduced by claiming a “credit” for payments made by settling co-defendants. The non-settling defendants may elect either a dollar-for-dollar credit or a percentage reduction based on the percentage of fault attributable to the settling defendant.

STATUTE OF REPOSE

Doctors and hospitals are now granted a 10-year statute of repose. A plaintiff must file suit within 10 years of the incident otherwise the case is time barred. This effectively cuts the tail of an obstetrician or neonatologist in half.

EMERGENCY CARE PROTECTIONS

Plaintiffs must show a demonstration of “willful and wanton” conduct in order to prove a negligence case against an emergency care physician. This measure provides significant protection for a physician who had no prior contact with or health history from the patient.

PERIODIC PAYMENTS

Texas law now requires periodic payment for future medical costs greater than $100,000 and gives the judge the option of allowing periodic payment for other future damages.

INADMISSIBILITY OF NURSING FACILITY SURVEYS AND REPORTS

Deficiency reports, surveys and other findings by state agencies against nursing homes are now admissible as evidence in a civil lawsuit only when the evidence relates to the patient, incident or comparable event on which the claim is based or pertains to a material rule or statutory violation. Additionally, the violation must be affirmed and no longer appealable either administratively or through court review in order to be admissible in a civil action.

APPEAL BONDS

In the past, appeal bonds had to be purchased for the full amount of the judgment against defendants plus two years post-judgment interest at 10 percent per year. That made the option of appealing jury awards prohibitive. The new law excludes the requirement to bond any punitive damage portion of the judgment and caps the amount required for bonding to $25 million or 50 percent of the defendant’s net worth.

SWEEPING EXPERT WITNESS REFORMS

The plaintiff is required to produce an expert witness report within 120 days of filing suit. The witness can be struck if it is determined he or she lacks the requisite knowledge, experience or qualifications to serve as an expert. Presumably, this and other procedural changes will reduce lawsuit costs and limit the number of frivolous filings.

PROOF OF DAMAGES

New law requires that recovery of health care expenses is limited to the amount actually paid or incurred by the patient (not what was initially billed by the health care provider). In past cases, defendant doctors and hospitals could be forced to pay more than what the patient actually incurred on their past medical expenses.

P. O. Box 684157  |  Austin, Texas 78768-4157 | 2301 South Capital of Texas Highway, Building J-101  |  Austin, Texas 78746  |  512.703.2156  |  Fax: 512.703.2050