Tort Reform’s Magic Number

With Republicans now controlling both houses of Congress, everything old is new again in the battle over tort reform. Several past proposals–to cap medical malpractice awards and restrict class actions, for example–will be reintroduced in the upcoming session. But even proponents of these measures recognize that GOP control can’t guarantee ultimate success, since the party’s tiny Senate majority won’t be able to bring a bill to a vote in that chamber without Democratic help.

At least tort reform proposals are less likely to get killed in a Senate committee, says Matthew Webb, director of legal reform policy at the U.S. Chamber of Commerce. In particular, he’s cheered by Orrin Hatch’s return as Senate Judiciary Committee chairman. However, Webb notes that in order to avoid a filibuster, “the issue in the Senate, like always, is getting 60 votes, and that hasn’t changed.” Thus any tort reform accomplishments will have to be bipartisan.

Still, in the November passage of the bill that created the Department of Homeland Security, the GOP demonstrated its willingness to push for tort limits whenever the opportunity arises. Senate Democrats were unable to strip the bill of several business-friendly provisions already approved by the House.

Among other things, the Homeland Security Act eliminates punitive damages in suits against companies that make antiterrorism technology, requires physical injury as a prerequisite to any recovery, and reduces damages by the amount of collateral source compensation. Federal contractors for antiterrorism technology will also enjoy the government’s sovereign immunity in product liability actions, provided that the contractors comply with specifications and inform the government of all known risks. Additionally, the law limits the legal liability of manufacturers of thimerosal, a mercury-based additive used in vaccines that is alleged to cause autism in children.

Given that all of these provisions stayed intact in a bill passed by the old Democrat-controlled Senate, tort reform proponents hope that their other pet proposals will fare equally well in the new Congress. Key among these is Representative James Greenwood’s medical malpractice bill, which the Pennsylvania Republican plans to reintroduce in the upcoming session.

Capping Malpractice Damages

Greenwood’s bill, dubbed the Help Efficient, Accessible, Low-cost, Timely Healthcare [HEALTH] Act, already cleared the House last September. It would cap punitive damages in med mal suits at $250,000, and eliminate punitives entirely in actions against the manufacturer or distributor of a medical product that complies with Food and Drug Administration standards. The bill, backed by the U.S. Chamber of Commerce, the American Medical Association, and other business groups, would also limit lawyers’ contingency fees to 15 percent of any amount in excess of $600,000. And it would eliminate joint and several liability in favor of proportional liability.

But even if the House okays Greenwood’s measure for a second time, it will face a tough battle in the Senate, predicts Carlton Carl. A spokesman for the Association of Trial Lawyers of America, Carl notes that the Senate considered a “less draconian” medical malpractice proposal last summer that nonetheless went down to defeat, 57 to 42. The ATLA official adds, “I didn’t see that many votes changing on November 5.”

However, Webb at the U.S. Chamber of Commerce remains optimistic about the changes for both medical malpractice legislation and class action legislation, which is another priority for his group. “There’s a very good possibility of [either] or both of them happening next year,” he says.

Like the medical malpractice bill, class action legislation passed the House last year only to go nowhere in the Democrat-controlled Senate. The intent behind the various proposals was to require most class actions to be filed in federal courts. Webb predicts “fairly quick” action in the new Congress, adding, “We’ve been doing a very aggressive effort to get to 60 votes.” But Jason Thomas, a staff analyst at the conservative Citizens for a Sound Economy, still considers class action legislation “a long shot.”

The one bill that the business lobby doesn’t want to see reintroduced in the new Congress is the Patients’ Bill of Rights, which would establish a limited right to sue HMOs. Though the bill passed the House in August 2001, it fell into a legislative black hole after the September 11 attacks that year. ATLA’s Carl says that his association will continue to push for the bill. “But will it pass?” he asks. “I don’t know.”

As with every other question about tort reform, the answer will depend on which side can reach the Senate’s magic number.

LOAD-DATE: February 28, 2003