Californians Would Be Limited In Right To Recover Damages Against HMO

California patients who today have a right to recover unlimited damages against an HMO under a state liability law would be limited to recovering $1.5 million for their pain and suffering and in punitive damages under the Norwood amendment to be voted on in the U.S. House of Representatives today. In addition, an independent review law set up in California would be undermined by Norwood’s federal legislation because HMOs that use the review process and prevail would be extended a presumption of innocence in California courts that does not exist today.

“This compromise is not just a give-away to the HMO industry, but a take-away from the states,” said Jamie Court, executive director of the Santa Monica-based Foundation for Taxpayer and Consumers, sponsor of California’s HMO liability law. “Californians that now can recover unlimited damages against HMOs that deliberatively kill or maim their love ones would be strictly limited under the Norwood-Bush deal. Texans who can recover unlimited non-economic damages today for their pain and suffering would be restricted to no more than $1.5 million as well. In Texas, there is only a cap on punitive damages, meant to punish, not compensatory damages, designed to make the patient whole. This amendment is a federal power grab that does great violence to the hard work done in state houses across during the last half dozen years. It should be dead on arrival in the Senate.”