News & Trends

Negotiating the patient's right to sue

By Senior Editor Janet Gemignani

There's a good chance that patients' rights legislation will be enacted this year and will include some form of expanded liability, according to Hewitt Associates' Frank McArdle in a March legislative and regulatory report.

President Bush panned a version introduced by Senators Edward Kennedy (D-Mass.) and John McCain (R-Ariz.) and is reportedly preparing to endorse a bill to be introduced by Sens. John Breaux (D-La.), Bill Frist (R-Tenn.) and James Jeffords (R-Vt.) that requires patients to exhaust independent external review before going to court and has much lower caps on damages.

Among the reasons Bush threatened to veto the Kennedy-McCain bill—a modified version of the Norwood-Dingell bill that passed the House last year—is the $5 million cap on damage awards that he labeled "too high." The new bill also allows patients to sue employers and health plans in state court for quality of care issues and in federal court for contractual disputes. Employers would be excluded from liability only if they are not directly involved in making medical decisions that resulted in injuries. The bill would allow unlimited compensatory damages in federal court while capping civil assessments (similar to punitive damages) at $5 million for flagrant disregard for a person's life. Awards in state courts would be subject to caps set by individual states.

In a letter to Republican and Democratic leaders, Bush outlined the principles he wants to see in such legislation. Among them: Employers should be excluded from liability unless they make the final decision on wrongfully denied medical claims. The forthcoming Breaux-Frist bill would protect employers by allowing them to designate a third party to make determinations that could give rise to lawsuits. All lawsuits would be tried in federal court, with no civil assessments allowed and noneconomic damages capped at $500,000. Reportedly states with patient protection laws would be exempt from federal law after getting waivers from the Department of Health and Human Services.

Even with lower caps on damages, Todd Irons of the Health Benefits Coalition says the group, which represents employers and health insurers, is against any patient protection legislation that would allow new lawsuits. Although he has not seen the details of the Breaux- Frist version, he says based on reports the proposal is "a step in the right direction."

 

Janet Gemignani. Negotiating the patient's right to sue. Business and Health 2001;4:14.