Las Vegas Sun

March 28, 2024

Lawmakers write doctors’ prescription

WEEKEND EDITION: Aug. 4, 2002

CARSON CITY -- There is no doubt in the minds of most people who participated in the four-day special legislative session last week that the doctors got the better of the lawyers.

The reason is simple. The doctors convinced lawmakers to pass a comprehensive tort-reform bill that includes caps on damages for pain and suffering and liability protections for physicians who treat trauma patients. The lawyers got nothing in return.

Gov. Kenny Guinn, whose 11-point proposal served as the reform bill's foundation, said the doctors came out ahead on the deal and he expected that "from the get go."

"Where you look at where the doctors started from, which was unlimited caps, whatever you could give to the doctors had to come from the lawyers' side," Guinn said. "The caps went to the doctors' side of the ledger. It's like moving assets. The lawyers started out with no caps."

The fact that many Southern Nevada physicians staged protests in Las Vegas over the legislation shows that the Nevada Medical Liability Physicians Task Force, which lobbied for the reforms, has its work cut out in educating colleagues on just how far Assembly Bill 1 goes in altering the civil justice system.

To prove just how big a victory this is for doctors, consider that they have been pushing for tort reform in Nevada since 1975. This is the first time they succeeded, and they got nearly everything they sought. The doctors also landed at least one key provision -- a cap of $50,000 on malpractice liability for doctors who treat trauma patients -- that goes beyond California's tort law.

"The task force will stay together to protect what we have achieved in the special session," Dr. Michael Daubs, Nevada Orthopedic Society president, said. "We intend to come back to the 2003 regular legislative session to make sure what we achieved isn't taken away.

"I think this will stabilize our malpractice premiums and I hope that this will also decrease them. We need to go back and explain the bill to doctors in Las Vegas. I do think this is the reform that we needed to keep doctors in Las Vegas."

The task force, a coalition of nine medical associations, was the main force behind the bill passed early Thursday. But the task force also shot itself in the foot earlier in the week by protesting a key portion of the original bill before lawmakers had a chance to debate or amend it. The fallout caused the bipartisan compromise to nearly collapse, which would have left the doctors at square one.

The seeds of the legislation were planted last year when St. Paul Cos. of Minnesota, which provided medical liability coverage for 60 percent of Nevada's doctors, abruptly pulled out of that type of coverage.

The company, then the nation's second-largest medical liability insurer, said it dropped medical malpractice insurance because it was hurt by rising jury awards for malpractice damages as well as by the Sept. 11 terrorist attacks that drained insurance company coffers nationwide.

The result was that malpractice insurance for Nevada doctors rapidly escalated -- in some cases as high as 300 percent. The increases forced at least 29 doctors to close their doors and 14 others to take "early retirement" as of early July, according to the Nevada State Medical Association.

Doctors realized that to effect change they needed to organize, which led to creation of the task force in January.

"The physicians, first of all, got united under one platform," Dr. Ikram Khan, a Las Vegas surgeon, said. "We formed a public relations and education component. We also had a grass-roots effort to educate legislators and their constituents. The task force was the key reason we were able to get a meaningful tort-reform package."

Although political novices, the doctors quickly got the upper hand in their quest for tort reform by hiring Brown & Partners, a Las Vegas marketing and public relations firm whose clients include resorts.

"Frankly, it was a group that was not organized politically," Mark Brown, the firm's chief executive officer, said of the doctors. "Our first challenge was to form an organization. We then had to educate the public that this was a crisis."

That education took many forms, including media coverage of doctors who said they were leaving and later an intense postcard and e-mail campaign in which doctors and patients bombarded lawmakers. Later, they ran an extensive newspaper and television advertising campaign.

"Doctors were leaving, and offices were closing," Brown said. "We had a grass-roots campaign in which we realized that the biggest assets we had were the physicians' patients.

"We then had to educate the public that there was a solution out there."

That solution, the doctors felt, was California's Medical Injury Compensation Reform Act, adopted in 1975. It includes a $250,000 cap on damages for pain and suffering.

Not everybody was sold on the doctors' publicity blitz, however. Assemblywoman Chris Giunchigliani, D-Las Vegas, said "it was difficult to get the facts out in an issue tied to emotion."

The campaign in Nevada took on an air of militancy, as reflected on July 3 when Daubs and other orthopedic surgeons said they could no longer afford the risk of treating trauma patients at University Medical Center.

The trauma center's closure gave lawyers, who opposed caps, the opportunity to strike back and claim that doctors were holding Southern Nevada hostage. Ten days later, UMC's trauma center reopened.

The doctors stayed on message, however, and scored their first victory by convincing Guinn to call the special session. In the days leading up to the session, the governor met with Republican lawmakers to discuss his proposals, including a $350,000 cap on damages for pain and suffering with no exceptions.

After lawyers, doctors and their representatives huddled with the governor Monday morning, the state's top lawmakers emerged early that afternoon with a bipartisan compromise bill that included the $350,000 cap with eight exceptions, including for malpractice that caused death, brain damage, sterility or wrongful amputation.

Some GOP lawmakers became livid, however, when they learned of the exceptions.

So, too, did members of the task force and a medical auxiliary group in Las Vegas that began sending out e-mails critical of the original bill. The situation began spinning out of control by Tuesday morning when some insurers, who had been given only the page of the bill that had the cap and eight exceptions, told doctors that there was no way the proposed tort reform would stabilize or lower insurance rates.

"Limited information that didn't fully explain the bill was spread throughout the Las Vegas community by people affiliated with the medical community," Marybel Batjer, Guinn's chief of staff, said. "Therefore there was a rush to judgment that absolutely was incendiary for the bill at that point in the process."

The bill, of course, was still making its way through the Assembly and Senate, with major amendments along the way. "There was a disconnect in Las Vegas with what was happening in Carson City and the bill that was passed," Batjer said of the critics in Las Vegas. "They were 24 hours behind us."

Senate Majority Leader Bill Raggio, R-Reno, said the final bill was not perfect, but that the insurance industry will say it made "a giant step in Nevada."

"We got mixed signals from both sides," Raggio said. "The spokesmen had trouble keeping their people together, particularly on the medical side. A lot of (doctors) were not politically wise and they didn't understand how the process worked. They didn't understand there was a lot of compromise that had to be achieved.

"They told me they got a pretty good education up here. They understand now that they were not just going to come up here and impose an arbitrary cap. They were well-intentioned."

As it turned out, six of the eight exceptions to the cap were eliminated in the final bill and the two that remained contained the highest standards that have to be met by the plaintiff to collect damages for pain and suffering of more than $350,000.

One exception is for gross negligence, which, according to Las Vegas attorney Gerald Gillock, occurs in less than 1 percent of all malpractice cases. In the other exception, the cap can be exceeded only when the court determines that "exceptional circumstances" were involved.

Even under the exceptions, the maximum a plaintiff can receive from a physician for pain and suffering under the new law is the maximum amount of a doctor's insurance policy per incident. For a doctor with hospital privileges, that is typically $1 million.

But Guinn said that, as an example, if the plaintiff is awarded economic damages of $800,000 for medical bills and lost wages, the most he or she then could receive from the doctor for pain and suffering would be $200,000.

Guinn said there still can be cases where a plaintiff can be awarded well in excess of $1 million. That's because economic damages in Nevada do not have caps, which is the case in nearly every state, including California.

"California just had one case for $51 million and another for $43 million, and they have a $250,000 cap, don't they?" he said.

The point the governor was making is that judgments can still run into the tens of millions of dollars because of economic damages. While the doctor could be on the hook for a judgment above his or her insurance, in most of those cases the plaintiff goes after the deeper pockets, which are the hospitals where the malpractice most likely occurred. Many hospitals carry liability coverage of at least $20 million per incident, Batjer said.

A doctor will not have to pay out of pocket for pain and suffering since the maximum he can be charged per incident for those damages is $1 million, the limit of his insurance policy.

Robert Byrd, chairman of the quasi-state Medical Liability Association ofNevada, told the Legislature that the bill should stabilize rates because thecaps will help insurers predict how to establish premiums. He also said that the rates should then eventually go lower, though he could not say for certain how long that would take.

His board is going to meet later this month to look at the bill and determineif there should be any change in rates for doctors covered by the association.

The biggest losers in Nevada's tort law will be victims of medical malpractice who would have been covered by the six exceptions that were eliminated.

"In some ways, this bill is significantly better than MIRCA (California's reform), which the doctors were trying to shove down people's throats," Gillock said. "But I'm hearing doctors say that this is not enough, that they still want MICRA.

"I can tell you that victims' rights have been significantly affected. We've placed an artificial ceiling on noneconomic damages that are normally left to the province of the jury. The lawyers are not the victims here. If the doctors want to cry victory over the people they have injured, let them do it."

Las Vegas attorney Dean Hardy, Nevada Trial Lawyers Association past president, said the bill was not a victory for doctors but "a diminution of people's rights."

One reform wrinkle that helps malpractice victims, however, is that if there is more than one defendant, the cap applies to each defendant separately. Another wrinkle -- and one Gillock said could haunt doctors -- is the provision that allows physicians to be liable for no more than the percentage of pain and suffering damages that equates to the level of negligence attributed to them.

Gillock said for example, this can actually hurt doctors in cases when they are deemed liable for 90 percent of the malpractice and the hospital is liable for only 10 percent. In a $1 million judgment, the doctor would have to pay $900,000 and the hospital would fork over $100,000. Without this provision, however, Gillock said the defendant would likely go after the hospital's deeper pockets, with the doctor paying considerably less than 90 percent of the judgment.

After the bill was passed by the Legislature, the task force issued a press release with a headline that read: "Nevada MICRA includes many major California provisions plus other unique protections for physicians and patients alike."

Other provisions include:

A $50,000 liability cap for any physician who treats a trauma patient in any trauma center or emergency room in the state, a provision that is not in California's reform. The big winners are expected to be trauma centers and emergency rooms because more physicians will be encouraged to handle trauma patients.

A $10,000 penalty for hospitals and insurers who fail to pass along information to Nevada's Board of Medical Examiners about disciplinary action against doctors. That information is designed to help the board do a better job of disciplining doctors, such as revoking their licenses.

A requirement that malpractice cases come to trial within three years of filing, a time frame that will be reduced to two years after October 2005. In many cases, such lawsuits now take five years before they go to trial.

A requirement that malpractice lawsuits be filed within three years of injury, rather than the four-year time limit under existing law.

A medical error reporting system in which information on deaths and serious injuries is to be forwarded by hospitals and clinics to the state health division for analysis. The purpose is to correct problems that led to errors without the information leading to punitive action. A whistleblower provision for those who report such errors is also included. The health division system will not become operational unless the Legislature chooses next year to fund it at an estimated cost of $300,000 to $400,000.

"It's an excellent method of trying to prevent medical errors, which causes injuries to patients and causes premiums to rise," Assembly Majority Leader Barbara Buckley, D-Las Vegas, said.

When all was said and done, former eight-time Assembly Speaker Joe Dini, D-Yerington, said he thought the doctors "are getting a good bill, and it still doesn't hurt the civil rights of the patients."

Dini, who is retiring from the Legislature, credited Guinn with helping the doctors achieve tort reform.

"Nobody wants to see the health system go to hell in Las Vegas," Dini said.

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