Court strikes down Ill. medical malpractice caps

ROCKFORD — Limiting the compensation medical malpractice victims can receive for noneconomic damages such as pain and suffering became a three-time loser today in the Illinois Supreme Court.

In some states, if the issue were a criminal, it would be locked away for life.

And, Rockford attorney Frank Perrecone said, today’s decision that the Illinois Medical Malpractice Act of 2005 violates the state’s constitution might effectively lock away legislative efforts to place caps on the awards for damages that do not involve proveable dollar amounts, such as medical bills and loss of income.

“From my reading of the decision,” said Perrecone, who co-wrote an article critical of the legislation for the Northern Illinois University Law Review in 2006, “it’s consistent with the two previous times medical malpractice caps were struck down in that the law violated the separation of powers between the judiciary and the legislature.”

Changing that dynamic, Perrecone said, would likely require rewriting the Illinois Constitution “and, in doing so, you would have to rewrite the separation of powers clause and then you would be rewriting years and years and years of cases that came before. I just don’t see that it would happen.”

In today’s decision, the Supreme Court upheld a 2007 Cook County court decision that malpractice caps violate the principle of the separation of powers clause in the Constitution because they infringe on the power of the judicial branch. In a partial dissent Justice Lloyd Karmeier of Fairview Heights said it was the court that was violating the separation of powers by second-guessing the legislature’s attempts to reduce health care costs.

The Cook County decision grew out of LeBron vs. Gottlieb Memorial Hospital, a 2006 case brought because of injuries received by Abigaile LeBron during her birth by Caesarean section at the hospital. Attorneys for LeBron argued in circuit court that she sustained injuries to the extent that damages would far exceed the limits of $500,000 against a doctor and $1 million against a hospital described in the law.

Rockford Health Systems President and CEO Gary Kaatz, who predicted in December that the court would overturn the law, agreed that caps on noneconomic damages “are probably done, at least until we get some new members on the court.”

Kaatz, who worked for passage of the legislation in 2005 as a member of the board of the Illinois Hospital Association, said the law had other provisions such as Good Samaritan immunity extended to retired physicians providing free care, allowing health care providers to say “I’m sorry” or other expressions of grief or apology without the statement being used against them, and medical discipline and insurance regulation reforms that also are lost.

“I thought it was a very good piece of legislation,” Kaatz said, “and I think the separation of powers argument in this day and age is specious. It’s out of date.”

Although he was disappointed in the decision, Kaatz said he thinks hospitals have made so many advancements in patient safety and decreasing avoidable errors “that I actually don’t think it’s going to have a significant impact on (insurance) premiums (for health care providers).

“I think the long-term problem could be — the operative words being could be — access to health care services could be decreased if, in fact, providers decide that, given this law, the risk quotient has gone so high that they’re not going to provide certain services they would have provided otherwise.”

Rich Walsh, chief operating officer of SwedishAmerican Health System and president of SwedishAmerican Hospital, said today’s decision means the health system will earmark more of its money into insurance.

“We’re almost certain that our costs for malpractice insurance will go up,” Walsh said. “We self-insure for malpractice, but we’re obligated to make deposits in our self-insurance fund every year and, with the caps being lifted, the amount of money we’re going to have to deposit each year, we’re almost certain, is going to go up.”

He said committing more money to insurance leaves less for other areas of concern, including patient care. “That’s the big thing it takes away from because now we’re taking this money and buying insurance with it rather than putting it into staffing or technology or other things that would go toward direct patient care.”

Walsh also said he expects the loss of malpractice caps to hurt efforts to recruit new physicians, especially in areas such as obstetrics and neurosurgery.

“Physicians concerned with malpractice have options to go to other states where they have caps and their malpractice insurance and risk will be a lot less,” Walsh said, “Since the caps were instituted, our recruiting in those areas has been very successful. Before that, it was almost impossible to recruit those specialists here, and now we think it’s going to fall back to that.”

Dr. Bryan Apple, an anesthesiologist and newly elected president of the Winnebago County Medical Society, said northern Illinois saw difficulty in recruiting or an actual exodus of obstetricians and neurosurgeons before the caps were instituted in 2005 and could see it again.

“Those two specialties are very hard to find,” Apple said, “and, with the litigious situation, it’s hard to keep them. The decision certainly disrupts the stability we had seen since 2005.”

Oliver “Jackson” Schrumpf, a Sulphur, La., attorney involved in a challenge to that state’s malpractice caps, said that, according to the National Practitioner Databank report of Dec. 31, 2007, the median payout nationwide, including states with and without caps, for the preceding four years was $145,000, and the mean average payout was $284,198.

He said three percent of claims nationwide exceed $1 million and only one-tenth of a percent exceed $5 million. “The only beneficiary of caps is the insurance companies,” Schrumpf said.

“Today, all citizens of Illinois experienced a great victory,” Rockford attorney Daniel Gilbert said in joining other trial lawyers and consumers’ groups who praised the decision as a ruling in favor of patients’ rights.

“With this decision, we can now focus on the real issue — providing meaningful insurance reform that will keep costs down for doctors and patients alike,” Peter J. Flowers, president of the Illinois Trial Lawyers Association said in a statement.

Illinois State Medical Society President Dr. James Milam said in an interview in Rockford two weeks ago that “there is no Plan B” for increasing access to health care by improving the legal climate for doctors in Illinois without malpractice caps.

Milam, in a statement today, called the decision “a huge blow to Illinois patients and doctors” and said it was “ironic the decision comes at the very time national lawmakers are searching for ways to expand patient access to care and contain unnecessary costs.”

The Associated Press contributed to this story.
Staff writer Mike DeDoncker can be reached at mdedoncker@rrstar.com or 815-987-1382.