Arkansas liability bill heads to Governor’s desk
Arkansas patients are one step closer to a healthier liability system that works for them and their physicians, as critical reforms are pending the governor’s signature.
House Bill 1204, which narrowly passed the state Senate, aims to restricts damages for medical bills in personal injury lawsuits to the amounts actually necessary to resolve medical bills rather than the amounts billed by the health system. The legislation now heads to Governor Sanders’ desk for her signature. Supporters tout the bill as a solution to reduce medical lawsuit abuse and protect the health care system from exploitation.
“This reform prevents plaintiffs, and their attorneys, from profiting off of the health care system,” said Sen. Missy Irvin (R-Mountain View), one of the bill’s sponsors. She emphasized that the limits apply only to medical bills and would not affect compensation for lost wages, emotional distress, or punitive damages.
Even if signed by Governor Sanders, legal threats to the bill loom large. Opponents are circling around language in the bill that runs counter to Arkansas’ collateral source rule, which protects plaintiffs from having third-party benefits reduce their financial recovery. A similar provision was deemed unconstitutional in 2009.
As Arkansas debates this reform, the stakes remain high. Advocates stress its potential to curb lawsuit abuse, while critics are already launching legal efforts in case the bill is signed into law.
Click here to read more about this pending legislation in Arkansas and the benefits to patients across the state.
Liability reforms can help doctor drought in New Mexico
New Mexico’s difficult medical liability climate has left it grappling with a severe health care worker shortage, bucking national trends as one of the only states to lose doctors over the past five years.
Think New Mexico, a nonpartisan policy organization, attributes the exodus of doctors in part to the state’s medical liability system.
Executive Director Fred Nathan highlights its central role: “Medical malpractice shouldn’t make your eyes roll to the back of your head, because it’s probably the leading factor in why we have a shortage of doctors.” With one medical liability lawsuit for every 14,000 residents—more than double the national average—costs for liability insurance have soared, sometimes by 500%. Providers are being pushed out of the rural state, creating an access to care crisis.
To address these challenges, Think New Mexico proposes reasonable limits on attorneys’ fees, ending lump-sum payouts, and allocating punitive damages to a public fund aimed at preventing liability cases. Senate Bill 176, introduced to advance these reforms, faces hurdles in committee hearings as the legislative session progresses.
In addition to proven and traditional reforms, the group champions interstate compacts that allow health workers licensed in other states to practice in New Mexico. Such agreements could ease shortages by streamlining entry for professionals like psychologists, physical therapists, and emergency medical personnel.
Nathan warns that reversing the loss of healthcare workers will require sustained legislative effort but remains optimistic: “This is the single most important thing the Legislature can do this session to reduce the healthcare worker shortage; it is so easy.”
To read more about the troubling trends on the horizon for New Mexico’s health care system, click here.
Litigation loans drive up medical lawsuit abuse, health care costs
The rise of third-party litigation funding (TPLF) is transforming the legal landscape, at a high cost to patients, physicians, and the health care system at large.
TPLF allows hedge funds, private equity, and even foreign entities to fund lawsuits in exchange for a slice of a winning verdict or settlement. At a glance, it has the potential to offer underserved patients with legitimate claims a financial resource, but in reality, it is fostering medical lawsuit abuse.
A feature article in Inside Medical Liability highlights the problems caused by a lack of transparency and regulation in TPLF.
“TPLF raises ethical concerns and has been accused of perverting the civil justice system because external funding compromises the ability of plaintiff’s lawyers to independently represent their clients’ best interests; deceives defendants, jurors, and judges as to the interests at play in claims and lawsuits; and shortchanges plaintiffs financially because awards disproportionately go to third-party litigation financing companies at the expense of the very plaintiffs they were designed to compensate,” the article highlights.
Without traditional interest rate limits and oversight from consumer lending laws, plaintiffs can be gouged by these third-party firms and receive little to no financial settlement that may result from their claim.
While federal regulation and oversight is lacking, a few states have begun to understand the outsized impact such financing has on the “social inflation” of our health care system. Maryland, New Hampshire, Ohio, Rhode Island, and South Dakota have considered legislation to require the disclosure of TPLF.
The MPL Association has pushed for stronger regulations to curb abuses, protect patients, and restore balance to the health care system. To better understand the negative impact this funding pipeline has on our medical liability system, click here.