Final Tort Reform Legislation

Date of Publication (April 14, 2017)

SF 465, the IMS-crafted medical liability reform legislation that passed the House on Wednesday, is well on its way to final passage. As is typical, the components of the bill have evolved throughout the legislative process. The final draft of SF 465, which is expected to be signed into law in the coming weeks, includes the following reforms:

$250,000 Cap on Noneconomic Damages

The legislation caps noneconomic damages — awards meant to compensate for intangible damages like pain and suffering — at no more than $250,000. The cap does not affect economic damages, which compensate for tangible damages like lost wages and the costs of medical care, or punitive damages that penalize egregious behavior. The cap on noneconomic damages does not apply in cases where a jury determines that the care in question resulted in a substantial or permanent loss or impairment of a bodily function, substantial disfigurement, or death. This exemption is modeled after the Massachusetts cap on noneconomic damages, which has been in place since 1986. The largest benefit of caps is the predictability they bring to the medical liability system, which results in decreased medical liability insurance (MLI) premiums. A primary concern with caps on noneconomic damages is the constitutional challenges that have been seen in many states. A handful of state Supreme Courts have ruled them unconstitutional, however, more nuanced caps, similar to the new Iowa cap, have proven more likely to survive these legal challenges.

Expanded Candor Protections

Enacted in 2015, Iowa’s Candor statute allows physicians to engage their patients in frank and confidential discussions following an adverse outcome, without concern that the information shared in these discussions might later be used against the physician in court. The statute is designed to speed patients’ access to information and help to maintain the physician-patient relationship. Data from other states shows that these structured early disclosure programs are effective in curbing lawsuits and avoiding patients feeling like they have to file suit just to get answers. Since early 2016, a facility in Eastern Iowa has been piloting the voluntary Candor concept and has helped identify opportunities for expanding the statute. Under current law, only cases of death or serious physical injury qualify for the Candor protections. SF 465 lowers that threshold so any cases of physical injury would qualify. It also expands the list of providers able to initiate a Candor discussion from just physicians, ARNPs, physician assistants, and podiatrists, to include all members of the healthcare team. 

Strengthened Expert Witness Standards

Current Iowa law only includes a loose requirement that expert witnesses in medical liability suits have qualifications that relate to the care at issue. In practice this has resulted in instances where the expert witness is of a different specialty than the defendant and instances where a non-physician is allowed to serve as an expert witness questioning the professional judgment of a physician. SF 465 strengthens these standards to require that an expert witness be licensed and in good standing in the same or a substantially similar field as the defendant, and have been in active practice or academia within the five years preceding the incident in question. If a defendant is board certified, the expert witness must also be board certified in the same or a substantially similar specialty, and if the defendant is a physician, the expert witness must also be a physician.

Certificate of Merit

One reason that medical liability suits in Iowa take so long to resolve and that only 3% of suits are ever found against the defendant, is that there is not currently a formal mechanism to initially screen cases to determine if the suit even has merit prior to proceeding through the lengthy and expensive legal process. SF 465 seeks to address this by requiring that all plaintiffs file a certificate of merit in which an expert witness, who meets the new strengthened standards, certifies the standard of care alleged to have been breached and how that standard was breached. The certificate of merit must be filed within 60 days of the defendant’s response to the initial notice that a suit has been initiated and prior to the start of the discovery process. If a plaintiff fails to meet these requirements or is unable to find an expert willing to certify the merits of their case, the suit is dismissed and cannot be refiled.

SF 465 constitutes the most seeping medical liability reform package enacted in Iowa in more than a generation. For more information these reforms, please contact Dennis Tibben with the IMS Center for Physician Advocacy. This legislation is set to take effect July 1, 2017.

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