Court voids COVID-era protections for providers
Arizona’s top court has struck down a 2021 law that gave doctors and hospitals broad protection from medical liability lawsuits tied to care during the COVID-19 pandemic, leaving providers vulnerable from a time of great uncertainty and changing guidance.
In a split decision earlier this month, Justice James Beene, writing for the majority, said the law violated the Arizona Constitution.
The now-voided law was designed to protect providers treating patients during the pandemic, amid workforce shortages, inadequate safety supplies, and changing guidance from federal, state, and local government officials. Supporters and proponents of such legislation at the state and federal level, including the Health Coalition on Liability and Access, argued it was necessary to ensure continuation of care without fear of lawsuits.
Dissenting Justice Clint Bolick agreed that the state had the legal right to enact the shield, noting that “COVID-19 presented public policy challenges that were nearly unprecedented.”
Ann-Marie Alameddin, president and CEO of the Arizona Hospital and Healthcare Association, criticized the decision, saying it sends the wrong message to frontline providers who were widely lauded as health care heroes as the pandemic spread. The ruling, she said, amounts to the state giving healthcare workers “the back of the hand” after they risked their safety to treat patients at the height of the pandemic.
With the law struck down, patients who filed COVID-related claims between March 2020 and March 2022 may now proceed with their cases – a troubling prospect for access to care in Arizona. To read more about how this landmark decision could also have broader implications for other liability protections in Arizona, click here.
Inflation fuels skyrocketing liability awards
While physicians have long faced mounting pressures from challenging medical liability climates, rising costs fueled by inflation are adding to worries about access to affordable care.
The Doctors Company highlights the growing financial strain in its latest study, “Nuclear Verdicts and Rising Costs: How Inflation Is Impacting Medical Malpractice Claims.”
The research found that inflation – both economic and social – has added an estimated $4 billion in insured losses to the physician-focused liability market over the past decade. Social inflation is defined by the researchers as the observation that claim payments have grown faster than traditional, economic-based inflation.
Changes observed in shifting jury attitudes, plaintiff attorney strategies, and litigation financing, are particularly concerning. Large value claims are also surging at the same time, with the average of the top 50 liability verdicts jumping from $32 million in 2022 to $56 million in 2024.
Robert E. White, Jr., President of TDC Group, warns that nuclear verdicts “drive up the value of all claims where a settlement is being considered,” influencing the broader liability landscape.
As insurers adjust premiums to cover higher potential payouts, health care costs increase across the board. White notes that liability inflation “threatens affordability and drives up health care costs,” meaning patients may face higher bills and reduced access to care if the trend continues.
The study also identifies third-party litigation financing as an emerging cost driver, potentially adding $13 – $25 billion to insurer expenses over the next five years.
Click here to read the full report on how inflationary pressures are further affecting medical liability insurance and flowing down to increased health care costs for patients and providers.
Pennsylvania providers gain protection from venue shopping
A Pennsylvania court has reinforced the validity of contracts specifying where medical liability lawsuits must be filed, a ruling that signals optimism for both patients and health care providers across the state.
The three-judge Superior Court recently upheld a trial court decision transferring a suit from plaintiff-friendly Philadelphia County to Bucks County, honoring a venue-selection clause in a patient’s consent-to-operate contract.
Over the past several years, personal injury attorneys have sought to file medical liability lawsuits in Philadelphia, based on more favorable outcomes and higher verdicts, even if care was provided elsewhere in the state.
As the opinion stated, a venue rule “does not require that the action be litigated [in Philadelphia], nor does it in any way limit a plaintiff’s right to contract for another proper venue prior to filing suit.”
This decision is particularly encouraging for health care providers across Pennsylvania, who have faced disproportionate exposure to Philadelphia juries if their parent health care system conducts any business in Philadelphia. This ruling indicates a future stabilization of the liability environment, protecting physicians from personal injury attorneys’ attempt to venue shop while ensuring patients’ rights remain intact.
For patients, the ruling still preserves access to justice while supporting a more predictable and fair process for providers. Click here to read more about how this ruling contributes to optimism among Pennsylvania health care providers and their goal of maintaining access to high-quality care in the region.
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