TORT REFORM UPDATE
JUNE 25, 2004
Robert W. Kerpsack, Esq.
ROBERT W. KERPSACK CO., L.P.A.
21 East State Street, Suite 300
Columbus, OH 43215
Telephone: (614) 242-1000
Facsimile: (614) 242-4180
Email: bob@rwklaw.com
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TORT REFORM UPDATE TOPICS:
• S.B. 281 – MEDICAL MALPRACTICE LIABILITY
• H.B. 412 – NURSING HOME LIABILITY
• S.B. 179 – HOSP. LIAB./PHYSICIAN CREDENTIALING
• S.B. 227 – WORKERS’ COMP. SUBROGATION
• H.B. 51 – SAVINGS STATUTE/CIV. R. 41 DISMISSAL
• H.B. 212 – PREJUDGMENT INTEREST
• PENDING TORT REFORM LEGISLATION
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MED MAL REFORM
• S.B. 281 HIGHLIGHTS:
– Effective April 10, 2003
– Caps on noneconomic damages
– Limits on future damages
– 4-year statute of repose
– “Good faith” motions
– Non-subrogated collateral sources admissible
– Clerk’s annual med mal report
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MED MAL REFORM
CAPS ON NONECONOMIC DAMAGES
•
LIMITS ON “CATASTROPHIC” INJURIES:
• $500,000 each plaintiff/$1M each occurrence
__________________________________
“CATASTROPHIC” means:
Permanent and substantial physical deformity, loss of
use of a limb, or loss of a bodily organ system;
or
Permanent physical functional injury that permanently
prevents the injured person from being able to
independently care for self and perform life-sustaining
activities.
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MED MAL REFORM
CAPS ON NONECONOMIC DAMAGES (con’t)
• NOTE:
Prior to trial, any party may seek summary
judgment on the issue of whether the claimed
injury or loss is “catastrophic.”
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MED MAL REFORM
CAPS ON NONECONOMIC DAMAGES (con’t)
NON-CATASTROPHIC INJURIES:
The greater of:
• $250,000, or
• 3 x amount of Economic Loss
– Up to a maximum of:
$350,000 each plaintiff/$500,000 each occurrence
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MED MAL REFORM
CAPS ON NONECONOMIC DAMAGES (con’t)
•
SPECIAL JURY INTERROGATORIES REQUIRED:
– General verdict in favor of Plaintiff must be
accompanied by answers to interrogatories specifying:
1) Total compensatory damages;
2) Portion of total compensatory damages
that represents damages for economic loss; and
3) Portion of total compensatory damages
that represents damages for non-economic loss.
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MED MAL REFORM
CAPS ON NONECONOMIC DAMAGES (con’t)
•
NO JUDICIAL DISCRETION:
– R.C. 2323.43(D)(1) provides that a trial court “has
no jurisdiction” to award noneconomic damages in
excess of the imposed caps.
– R.C. 2323.43(D)(2) provides that the jury shall not
be informed of the noneconomic loss caps.
– R.C. 2323.43(E) provides that noneconomic
damages awarded in excess of the caps shall not
be reallocated to any other tortfeasor(s).
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MED MAL REFORM
CAPS ON NONECONOMIC DAMAGES (con’t)
• R.C. 2323.43’s caps on noneconomic damages
not applicable to:
1) Wrongful death claims; and
2) Claims against the State of Ohio.
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MED MAL REFORM
LIMITS ON FUTURE DAMAGES
• R.C. 2323.55’s discretionary order of a series of
periodic payments on future damages is applicable
to:
– “Future Damages” in excess of $50,000
• Total “future damages” for both economic and
noneconomic losses
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MED MAL REFORM
LIMITS ON FUTURE DAMAGES (con’t)
• SPECIAL JURY INTERROGATORIES REQUIRED:
– General verdict in favor of Plaintiff must be
accompanied by answers to interrogatories
specifying:
1) Total “past” compensatory damages;
and
2) Total “future” compensatory damages.
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MED MAL REFORM
LIMITS ON FUTURE DAMAGES (con’t)
• BEFORE JUDGMENT IS ENTERED on a verdict
including future damages in excess of $50,000:
– Any party may file a motion for a hearing re:
• Whether any or all of the future damages will be
received in a series of periodic payments.
– If a “periodic payment” motion is timely filed, then court
must schedule a hearing.
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MED MAL REFORM
LIMITS ON FUTURE DAMAGES (con’t)
•
FACTORS for Court to consider in exercising discretion
whether to order periodic payments of future damages:
– Purposes for which future damages awarded;
– Business or occupational experience of Plaintiff;
– Plaintiff’s age;
– Plaintiff’s physical and mental condition;
– Competency of Plaintiff, parent, guardian, or
custodian to manage the future damages ; and
– Any other relevant circumstances.
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MED MAL REFORM
LIMITS ON FUTURE DAMAGES (con’t)
• PERIODIC PAYMENT PLAN:
– Within 20 days of court’s order that future damages are
to be paid in a series of periodic payments, the plaintiff
must submit a periodic payment plan.
– A periodic payment plan approved by the court must
include adequate security to insure the future payments.
– Periodic payment plans shall include post-judgment
interest, in accordance with R.C. 1343.03 (currently 7%)
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MED MAL REFORM
LIMITS ON FUTURE DAMAGES (con’t)
• R.C. 2323.55’s discretionary periodic payment
plan for future damages is NOT APPLICABLE
to civil claims against:
1) Political subdivisions; and/or
2) State of Ohio.
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MED MAL REFORM
4-YEAR STATUTE OF REPOSE
• S.B. 281 ADDS R.C. 2305.113, which reinstitutes an
absolute four-year statute of repose on med mal claims.
– Only three (3) exceptions:
1) Minors or persons of unsound mind
2) Discovery
• One year from injury discovered within 3 to 4 years
• Injury discovered after 4 years is time-barred
3) Foreign objects
• 1 year after discovery of foreign object
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MED MAL REFORM
4-YEAR STATUTE OF REPOSE (con’t)
• S.B. 281 RETAINS 1-year SOL and 180-day notice
provision for extending the SOL on medical claims.
– NOTE: S.B. 281 prohibits a med mal insurance
company from considering the receipt of a 180-day
notice letter as a factor in establishing liability
insurance premium rates.
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MED MAL REFORM
“REASONABLE GOOD FAITH BASIS”
• S.B. 281 ADDS R.C. 2323.42, which includes requirement
of “reasonable good faith basis” for bringing med mal claim.
– Med Mal defendant may serve Plaintiff with a “Notice of
Demand for Dismissal and Intention to File a Good Faith
Motion.”
– If Plaintiff does not dismiss Defendant within 14 days,
then Defendant may file a “good faith” motion,
contending that Plaintiff lacked a reasonable good faith
basis for bring the action.
• Good faith motion may be filed between close of
discovery and 30 days after verdict.
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MED MAL REFORM
“REASONABLE GOOD FAITH BASIS” (con’t)
• COURT must conduct a hearing on “good faith” motions
• Factors for court to consider in deciding “good faith” motion:
– Whether Plaintiff obtained timely review by qualified
expert;
– Whether Plaintiff conducted pre-suit investigation or was
afforded full, timely discovery during litigation;
– Whether Plaintiff reasonably relied on evidence; and
– Whether Plaintiff “timely” dismissed Defendant upon
learning that no good faith basis existed for claim.
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MED MAL REFORM
“REASONABLE GOOD FAITH BASIS” (con’t)
• IF COURT DETERMINES:
– “No reasonable good faith basis” for asserting
or continuing to assert a med mal claim:
• The moving defendant is entitled to court
costs and reasonable attorneys’ fees incurred
in the defense of the med mal claim and in
asserting the “good faith” motion.
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MED MAL REFORM
COLLATERAL SOURCES OF RECOVERY
• S.B. 281 ADDS R.C. 2323.41, which permits
med mal defendants to introduce evidence to the
jury of a plaintiff’s non-subrogated/reimbursable
collateral sources of recovery.
• If evidence of a collateral source of recovery is
admitted, then a plaintiff may introduce evidence
of the cost (i.e. premium amount) of the collateral
source.
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MED MAL REFORM
CLERK’S ANNUAL MED MAL REPORT
• S.B. 281 ADDS R.C. 2303.23, which requires the Clerk
of every Court of Common Pleas to file an annual med
mal report with the Ohio Department of Insurance.
– Clerk’s report must provide detailed info re: pending
med mal claims (i.e. case number, filing date, trial date,
current status, settlement, judgment, and appeal).
– $5.00 is to be added to the filing fees for medical
claims to offset the costs associated with the required
reporting.
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NURSING HOME LIAB. REFORM
• H.B. 412 HIGHLIGHTS:
– Effective November 8, 2002
– Same SOL applicable to med mal claims
– Punitive damages: Financial ability of nursing home to
stay in business is relevant evidence
– Results of official inspections, investigations, and
surveys not admissible in civil actions against the home
– Attorney fees may be awarded for injunctive relief, but
not for damages
– If Ohio Department of Job and Family Services must
receive written notice of resident’s civil action if it is
paying the care and treatment bills
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NURSING HOME LIAB. REFORM
RESIDENTS’ “RIGHTS”
• Nursing Home Residents’ Rights Act--R.C. 3721.13, et seq.
– The “rights” of nursing home residents are delineated in
the 32 subsections of R.C. 3721.13(A)
• Civil liability can arise under (A)(3): Right to
adequate and appropriate medical treatment and
nursing care. . .”
– A nursing home’s violation of R.C. 3721.13(A)(3)
probably constitutes negligence per se.
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NURSING HOME LIAB. REFORM
ONE-YEAR SOL
• H.B. 412 EXPANDS R.C. 2305.11(D)(3)’S definition of a
“medical claim” to include claims for a violation of
residents’ rights against a “home” or residential facility.
– Same one-year med mal SOL (and 180-day notice
extension) is attributable to claims alleging a violation
of nursing home residents’ “rights.”
• Exception: Wrongful death claims are still subject
to the two-year SOL set forth in R.C. 2125.02(D).
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NURSING HOME LIAB. REFORM
PUNITIVE DAMAGES
• H.B. 412 ADDS 2315.21(E)(1) – (3):
– Punitive damages are still recoverable for a violation of
a nursing home resident’s rights.
– But, the jury must consider the following FACTORS in
determining whether to award punitive damages:
1) Nursing home’s assets, income and net worth;
2) Whether the punitive damages will deter future
tortuous conduct; and
3) The financial ability of the nursing home to remain
in business.
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NURSING HOME LIAB. REFORM
ADMINISTRATIVE “VIOLATIONS”
• H.B. 412 ADDS R.C. 3721.02(E)(1) and 5111.411:
– Official “findings” of a nursing home’s violations
of state and federal regulatory statutes are not
admissible in civil actions against the home for
alleged violations of a resident’s rights.
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NURSING HOME LIAB. REFORM
RESIDENTS’ REMEDIES
• H.B. 412 ADDS/AMENDS R.C. 3721.17(I)(2)(a) and (c):
• Both injunctive relief and compensatory damages are
available for a violation of a resident’s rights.
• However, attorneys fees may be awarded only for
injunctive relief imposed.
– Prior law: Permitted attorneys’ fees to be
awarded “to the prevailing party.”
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HOSPITAL LIABILITY REFORM
(NEGLIGENT PHYSICIAN CREDENTIALING)
• S.B. 179 HIGHLIGHTS:
– Effective April 9, 2003
– Establishes a rebuttable presumption: Hospital not
negligent in extending hospital privileges to a physician
– Establishes confidentiality and inadmissibility of peer
review committee proceedings and risk management
reports
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HOSPITAL LIABILITY REFORM (con’t)
(NEGLIGENT PHYSICIAN CREDENTIALING)
• JOINT COMMISSION ON ACCREDITATION OF
HEALTHCARE ORGANIZATIONS (“JCAHO”):
– Establishes national hospital quality “standards.”
• JCAHO accreditation teams conduct on-site “reviews”
of a hospital “practices” at least once every 3 years.
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HOSPITAL LIABILITY REFORM (con’t)
(NEGLIGENT PHYSICIAN CREDENTIALING)
• JCAHO “STANDARDS” REQUIRE: Hospitals to form
PEER REVIEW COMMITTEES to investigate the
“credentials” of physicians applying (or re-applying) for
hospital privileges.
• S.B. 179 AMENDS R.C. 2305.251(B)(1) to create a
rebuttable presumption that JCAHO-accredited
hospitals are not negligent in credentialing and granting
of privileges to physicians.
– However, JCAHO’s accreditation process does not
specifically include a review of the “competency” of
the doctors with hospital privileges.
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HOSPITAL LIABILITY REFORM (con’t)
(NEGLIGENT PHYSICIAN CREDENTIALING)
• S.B. 179 ADDS/AMENDS R.C. 2305.252:
– Prohibits the discovery/introduction of any evidence
(records or testimony) flowing from a hospital’s peer
review committee.
• S.B. 179 ADDS R.C. 2305.253:
– Prohibit the discovery/introduction of any evidence
(reports or testimony) flowing from a hospital’s risk
management office.
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WORKERS’ COMP. SUBRO. REFORM
• S.B. 227 HIGHLIGHTS:
– Effective April 9, 2003
– Establishes “pro-rata sharing” of limited tort recoveries
– Establishes an option to establish an interest-bearing
trust for future estimated future subrogated workers’
compensation benefits
– Requires the Ohio Attorney General to be notified of
potential tort claims
– Specifies that workers’ comp. benefits are subrogated
against employer intentional tort claims.
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SAVINGS STATUTE REFORM
• H.B. 161 MODIFIES R.C. 2305.19(A) (“Savings Statute”)
– Effective June 1, 2004
– A plaintiff may re-file a claim one year after a dismissal
(“failure otherwise than upon the merits”) or within the
period of the original statute of limitations, whichever
occurs later.
– Cures the legal malpractice “trap” of filing a Civ. R. 41
dismissal before the statute of limitations had run on a
civil cause of action.
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PRE/POST-JUDGMENT INTEREST REFORM
• H.B. 212 AMENDS R.C. 1343.03(A)—(D)
– Effective June 2, 2004
– Rate of Interest (if not specified): “federal short-term rate,”
as determined by the Ohio Tax Commissioner on Oct. 15
of each year (currently 4%) + 3% = 7 %
• Date from which pre-judgment interest is due:
– Contract claims: Date money became “due and payable”
– Tort claims: Admitted liab.—Date “accrued”
Contested liab.—Longer of the following:
1) Date of written notice of claim
(in person or by certified mail); or
2) Date of filing of Complaint
• No pre/post judgment interest on future tort damages
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MORE MED MAL REFORM PENDING
• H.B. 215 — Signed by Gov. 6/14/04 — Effective 9/13/04
• Provides that statements of apology/sympathy by med mal
defendant are not admissions of liability
• Provides that out-of-state medical experts are “temporarily
licensed” and subject to the authority of State Med. Board
• Provides “procedure” for motions for dismissal due to
“non-involvement”
• “Requests” OH Sup. Ct. to amend the Rules of Civil
Procedure to require med mal Plaintiffs to file “certificates”
signed by a medical expert confirming the merits of the
med mal claim(s).
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