Iowa Senate passes bill that would cap medical malpractice awards

March 21--Cedar Rapids lawyer Tim Semelroth settled a medical malpractice case recently in which a client who went in for spinal surgery had the wrong portion of his spine operated on.

The client suffered significant physical problems that confined him to a bed, put him in a wheelchair and limited the mobility of his hands, Semelroth said.

Adding to his client's problems was the fact he and his family lived in a split-level home, so his disability prevented him from getting up the stairs to the home's second floor, which is where the kitchen and living room were located as well as his children's bedrooms.

"He had to sleep in a hospital bed in his basement," Semelroth said. "He was basically a prisoner in the basement of his own home who couldn't interact with his family."

The settlement with the physician allowed his client and his family to move from the split-level house to a ranch-style home where they all could live on the same floor.

But Semelroth worries that a piece of legislation making its way through the statehouse could negatively affect future clients harmed by medical professionals. The bills, SF 465 and HF 487, would cap non-economic damages -- damages awarded for pain, suffering, physical impairment, inconvenience and mental anguish among others -- at $250,000 as well as create a certificate of merit, requiring plaintiffs' lawyers to submit proof of medical malpractice at the beginning of the case.

The legislation, which passed in the Iowa Senate on Monday afternoon along party lines, is necessary, provider groups argue, to help recruit physicians to this state by lowering the amount of medical liability insurance required. Iowa ranks 42nd when it comes to the number of physicians per capita as well as 51st for the number of emergency-medicine physicians per capita and OB-GYNs per capita.

"Iowa is at a competitive disadvantage to surrounding states when it comes to recruiting physicians," said Clare Kelly, chief executive officer of the Iowa Medical Society, which represents 6,600 of the state's physicians, residents and medical students, "The malpractice climate is one factor that contributes -- another is low Medicare reimbursement."

IMS says the bill is a necessary recruitment tool that will make Iowa more attractive than its Midwestern neighbors, which have lower medical liability premiums due to a combination of non-economic damage caps, limits on contingency fees for attorneys or certificate of merit.

Kelly said Iowa doctors must pay $20,000 annually while those in Nebraska pay $11,000 and in Minnesota pay $12,000.

But trial lawyers believe the bills will reduce accountability for doctors and hospitals.

"This bill creates an arbitrary, government-mandated, one-size-fits-all cap on the value of life, it bars available experts from testifying on the victim's behalf and it increases the cost of litigation," said the Iowa Association for Justice in a statement. The organization represents 700 trial lawyers across the state.

"There is no rationale for this bill, whatsoever. Rates of medical malpractice lawsuits in Iowa have fallen by over 50 percent in the past 15 years, and Iowa doctors pay some of the lowest medical liability premiums in the country."

Senate Republicans say the bill that passed on Monday strikes a balance between the needs of doctors and patients. The original legislation included a provision that would have capped contingency fee arrangements for the plaintiff's attorney at 35 percent -- this could have made lawyers less likely to pick up these cases, which are expensive to litigate.

An amendment put forth by Sen. Charles Schneider, R-West De Moines, and adopted by the Senate, took out that portion of the bill. What's more, he said, the bill does not cap economic damages -- lost wages or hurt potential earnings -- or punitive damages.

But Senate Democrats say capping damage fees simply will hurt those who need this system the most, especially children and the elderly who do not work and therefore can't collect economic damages.

"These are extreme cases, not just a mild mistake but major errors that have disrupted their lives," Sen. Nate Boulton, D-Des Moines, said. "Who are we hurting? The real victims of medical negligence. Ask any one of them if they're winners in this system. What does a win mean in this case? It means your life has been devastated."

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