Can damage caps cure what ails U.S. health care?


January 30, 1993|By DAN RODRICKS

Among the many thorns Hillary Rodham Clinton, new czarina of health-care reform, will find as she marches into that vast jungle of insurance and law is the matter of medical malpractice: Doctors who pay huge liability premiums, attorneys who represent hospitals and insurance companies, trial lawyers and their aggrieved clients, consumer activists; in short, a thicket of lobbyists.

There doubtless will be a call for caps on the damages that can be awarded to the victims of medical negligence and their families. Capping, it is believed, goes a long way toward resolving the crisis in liability insurance. It supposedly reduces the cost of insurance for docs. And that, supposedly, means the docs and hospitals won't charge as much for services. And that, supposedly, means we're all better off. Hallelujah!

Reformers -- read that, doctors and insurance companies -- say the effort to cap awards and encourage settlement of claims has the side benefit of reducing the amount of litigious litter in courts. But the jury, pardon the pun, is still out on that one. And it's still debating whether caps really reduce the cost of medical malpractice insurance.

Ah, life in a capitalist democracy -- it's a grand balancing act. Here we balance the interests of the docs and insurance companies against the interests of patients; the interests of malpractice victims against the interests of millions of Americans who pay escalating health-care costs while managing to get through life without having forceps sewed into their colons.

OK. Maybe putting a cap on damage awards will make health insurance more affordable and more accessible for more of us.

But before you swallow that line, consider this: Attempts to place finite limits on compensation for "pain and suffering" infringe on the rights of people to be satisfactorily compensated for permanent disabilities. They attempt to make the measurement of "pain and suffering" an empirical exercise rather than a subjective judgment of judge or jury.

Be honest. This is something most of us only consider when, or if, this bitter brand of tragedy visits home. Did you know, for instance, that, in Maryland, there's a cap on awards to victims of medical malpractice for their "pain and suffering?" The maximum compensation for "pain and suffering" is $350,000.

If a person -- the working, head-of-household, for instance -- suffers economic loss, he can be further compensated. If he requires ongoing medical care, he can be further compensated. But the limit on the amount he can receive for the initial damage -- paralysis, loss of limbs -- is $350,000. The law has been on the books for six years.

"The average citizens doesn't know this," says Marvin Ellin, Baltimore's leading medical malpractice attorney. "Ask them, 'Do you approve of caps on awards for pain and suffering?' They'll say, 'Yes.' Ask them, 'Do you understand what that means?' They'll say they don't. Mrs. Mulvanity is what it means."

Carolyn Mulvanity is a middle-aged woman, a former social worker, from Jessup, Ga. She is blind, a condition that allegedly resulted from negligence at Johns Hopkins Hospital in 1991. A suit filed by Ellin in Baltimore Circuit Court against the hospital and two doctors says Mrs. Mulvanity came to Hopkins for surgery related to Crohn's disease, a chronic gastrointestinal ailment. During anesthetization and prolonged surgery, it is claimed, the negligence of doctors caused Mrs. Mulvanity to suffer neurological injury that led to permanent blindness. She was never warned that blindness was a risk of the procedure, the suit says.

Mrs. Mulvanity is not the head of her household and not employed. Should she win her case, she will receive $350,000 for her permanent disability, plus an unspecified sum to cover medical expenses. "The suggestion that living the remainder of one's life in blindness has a state-approved compensation of $350,000 is not only repugnant, it is outrageous," says Ellin.

Beware the lawyers, especially the ones who take a cut. Ellin readily acknowledges self-interest in seeing caps abolished. "Of course, I get paid," he says. "But even if I didn't get a fee and Mrs. Mulvanity kept the $350,000, it would still be outrageous. . . . Maryland is one of only two states in the entire country that has denied adequate recovery for catastrophic injury. New Hampshire declared its cap of $875,000 unconstitutional, as did Ohio. The District of Columbia has no cap. Virginia has a $1 million cap. Pennsylvania, Delaware and New Jersey have no limitations for catastrophic injury.

"When they voted on this, the state legislators thought they were voting for a cap on pain and suffering. They actually were voting for a cap on compensation of permanent disability. They didn't read the fine print!"

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