New Mexico is one of 35 states that have enacted what are commonly called medical malpractice caps. These are laws that put an upper limit on the amount of money that juries can award to plaintiffs who win their medical malpractice lawsuits. Usually, the caps apply to non-economic damages only and do not limit things like reimbursement for medical expenses.
Medical malpractice caps became a major legislative priority in many states over the past decade or so as part of a larger debate about “tort reform.” Supporters of tort reform promised that damage caps and other changes would lower the costs of healthcare and prevent “frivolous” lawsuits. But many states are already starting to question the effectiveness and wisdom of damage caps, including one state where they have been struck down as unconstitutional.
In April, the Florida Supreme Court struck down a law that put caps on the awards that plaintiffs cans receive in wrongful death lawsuits related to medical malpractice. This move is a refreshing change that will hopefully inspire other states to examine their own medical malpractice caps.
Supporters of caps have argued that by limiting jury awards in medical malpractice cases, malpractice insurers will save money and that money will eventually trickle down into lower healthcare prices. But in many states, insurance companies are not required to pass on savings to doctors. As such, data has shown that malpractice caps do not substantially reduce the costs of healthcare.
But they do severely limit the damages awarded to individuals and families whose lives have been destroyed by medical negligence. Moreover, they impose arbitrary limits on medical malpractice awards with no regard for the specifics of individual cases.
Tort reform laws were touted as good for all Americans. But what these laws have done is essentially limit Americans’ access to the civil justice system. Hopefully, more state Supreme Courts will soon be following the example set in Florida.
Source: Consumer Eagle, "Medical Malpractice Caps Voided in Florida," Stephan Westlake, April 20, 2014