Kentucky’s legal liability climate leading to higher costs for everyone, lawmakers say

By Jacqueline Pitts Kentucky Source

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  • July 30, 2018

With Kentucky continuing to rank among the worst in the country in terms of legal liability climate, legal liability reforms are at the forefront of legislative discussions for many policymakers in the state.

Sen. Ralph Alvarado, a doctor from Winchester, said one of the main issues with Kentucky’s legal liability climate is doctors in the state practicing “defensive medicine,” which he said means health care professionals having to worry more about liability and being sued than the case at hand.

“You order tests to look for things that are rare and that are improbable just because if you happen to miss something you’re going to get potentially sued. So, you order the tests for things that are probably unnecessary, that add a lot more cost to health care. You might admit someone to the hospital just in case when it probably doesn’t need to happen,” Alvarado said.

While some legal liability measures have passed through the General Assembly in recent years, Alvarado says there is still more work to be done. One initiative in the 2018 session that didn’t see passage was a bill to place a constitutional amendment on the ballot in November to let voters decide if the General Assembly should establish thresholds on non-economic jury-awarded damages—giving Kentuckians the power to determine the state’s legal liability climate.

Currently, there is no limit on these claims in the state, and awards can run into the millions of dollars.

Alvarado said while most cases do not reach the point where a huge sum of money is awarded for non-economic damages in Kentucky, most healthcare providers including hospitals, doctors, and nursing homes must go ahead and budget for that type of cost each year, leading to higher health care costs for everyone.

“When we start having hospitals being threatened to be shut down because of that, that’s a major concern for any taxpayer, any Kentuckian. When you start losing access to healthcare, that’s an issue, and I think it’s a reality,” Alvarado said.

The Senator and doctor added the legal liability climate also becomes an employment and business issue as hospitals are threatened with shutdowns, which can impact wages and access in many areas.

“I think the attorneys are interested in having some reforms that’ll make it easier for them to practice law, to expedite cases, and be able to let juries to their work again. I think right now people are opting to get around juries because frankly the cost is so high and there’s just no confidence in the system.”

“It becomes a business issue. And we have a lot of our businesses in the state that are begging for some relief just to be able to again have some predictability within the system and know what to expect. By the same token we want to preserve the jury system, we want to preserve justice who have been wronged, but it needs to also be reasonable,” Alvarado said.

Watch the full interview segment with Sen. Alvarado here:

Acting House Speaker David Osborne said he believes it is time to start talking about tort reform differently as many don’t understand the goal of reforms and what it means to Kentuckians.

“It’s been difficult to define. I think it’s been very difficult for people to get their arms around. I think that there is an issue of fairness that is very prevalent about how we impact Kentucky businesses, but also, other professions,” Osborne said. “It takes a lot of education. I think we need to be very diligent about educating people about what Kentucky’s tort liability system looks like as compared to others. Let’s take a look at that and let’s see where there are places that we can improve it.”

As for what comes next in terms of reforms for the system, Osborne said caps on damages is a difficult item to tackle because of the caution practiced by many lawmakers when it comes to making changes to the constitution.

Hear Osborne’s comments on legal liability reform in the video here: