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Calif. law reduces malpractice awards, fees

The Boston Herald

A California cap on medical malpractice lawsuit judgments that could serve as a national model cut “pain and suffering” awards by 30 percent, a study released yesterday found.

Caps hit lawyers even harder, reducing their compensation by 60 percent, the Rand Corp. study shows. Rand is an independent think tank in California.

The Golden State’s 30-year-old law has been touted as a way to restrain soaring malpractice insurance rates by eliminating unpredictable jury awards to injured patients.

California’s medical malpractice insurance rates have risen more slowly than in other states. The law there limits pain and suffering awards and restrains how much lawyers can take as payment.

Local doctors say such reforms are needed because insurance premium hikes are pushing up their costs and driving some out of practice. Health care activists say soaring legal insurance costs are creating doctor shortages in some specialities.

“Obviously, this cap on noneconomic damages is effective, as this study shows,” said Dr. Alan C. Woodward, president of the Massachusetts Medical Society.

Under the California law, pain and suffering awards are capped at $250,000 but there is no limit on economic damage awards. Higher awards are cut by judges.

The Rand study analyzed data from 257 jury verdicts from 1995 to 1999. In nearly half, judges were forced to cut jury awards.

On average, awards were reduced by $286,000. But that rose to more than $1 million for patients with the most severe nonfatal injuries and to $1.5 million in cases of children under 1.

Reform advocates say the law blocks disproportionately large awards based on emotional responses from juries. Foes say the study shows the law hurts the most vulnerable.

“What it says is that the people with the most severe and entirely legitimate claims are having their rights severed,” said Doug Heller, head of California’s Foundation for Taxpayers & Consumer Rights.

Limits on lawyer fees blunt the law’s effects on patients, the study showed. When that is factored in, the overall amount patients received fell by just 15 percent from what they would have gotten without a cap.

The fee limit discourages lawyers from pursuing shaky cases, reformers say. Foes argue the limit has made it more difficult for legitimate victims to hire lawyers.

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