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The Daily News of Los Angeles

WASHINGTON – Pain and suffering awards for medical malpractice victims in California diminished by an average 30 percent under the state’s 1975 landmark law capping liability damages, analysts found in a report released Monday.

The plunge was even more dramatic in cases in which patients died of medical abuse or neglect, with awards dropping an average 51 percent.

The Rand study analyzed 257 medical malpractice cases between 1995 and 1999 in which juries granted verdicts for the plaintiffs. Researchers were able to see how much patients and their families would have received without the cap because California juries are not told it exists. Judges limit jury awards after the verdict.

Insurance industry officials hailed the analysis by the Santa Monica- based Rand Corp. as proof that California’s Medical Injury Compensation Reform Act is working as intended. Consumer advocates, however, said the think tank’s findings show medical victims and their families have been cheated of deserved compensation.

“I think it just confirms our thinking all along about the value of the law, that it does have an impact on what plaintiffs are receiving, and it has a definite impact on what the plaintiffs’ lawyers are receiving. We believe it’s a good thing,” said Julie Pulliam, spokeswoman for the American Insurance Association.

“What the study indicates is that people, regardless of the legitimacy of their claim and the seriousness of their injury, are seeing their recovery arbitrarily reduced – and in some cases, quite dramatically,” said Doug Heller, executive director of the Foundation for Taxpayer and Consumer Rights, also based in Santa Monica.

The California law limits to $250,000 the amount a plaintiff can recover for noneconomic damages such as pain, suffering, distress or disfigurement. Damages for economic losses, such as medical expenses or lost wages, are not capped.

The division over California’s law underscores the national debate on medical malpractice as states grapple with what the American Medical Association calls a “malpractice crisis” that is enveloping much of the country.

President George W. Bush has cited California’s law as a model in his calls for strict limits on jury awards, and the House last year passed legislation capping punitive damages. The bill has stalled in the Senate.

The Rand study also found attorneys would have received about $140 million more in fees had the state law not been in effect.

The analysts did not examine whether the number of medical malpractice claims has risen or fallen over time. Nor did they look at the number of or results of cases settled out of court.

Researchers also did not examine a central claim made by supporters of California’s liability reform: that its passage would hold down insurance premiums.

Consumer advocate Heller noted that the California Department of Insurance saw no fewer than 25 proposals to increase medical malpractice premium rates in 2003.

“They get the law to lower their liability, and then they do their best to ignore it when it comes to reducing their premiums,” he said about insurers.

Pulliam acknowledged that rates have risen in California, but said the rise has been far slower than in states without damage caps.
Contact the author Lisa Friedman at: (202) 662-8731 or [email protected]

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