At 2-year anniversary, Illinois' malpractice law nears first court challenge

By Adam Jadhav
ST. LOUIS POST-DISPATCH

The second anniversary of Illinois’ landmark medical malpractice legislation passed quietly last month, in part because not everyone is sure the package of reforms should or will last.

Later this month, the law will be tested before a Cook County judge. The question before the court will be whether caps on the damages for pain and suffering in a malpractice lawsuit are constitutional.

Only a few years ago, skyrocketing medical malpractice insurance rates caused a political and medical crisis in some parts of the state and the Metro East area in particular.

Dozens of doctors faced with rising bills simply closed shop or moved. Insurance companies blamed the area’s aggressive lawyers for oversuing. Plaintiff attorneys said insurance companies were just looking for a scapegoat to justify their rates and profits.

Lawmakers eventually came up with a compromise — the legislation now being challenged — which bolstered competition in the insurance industry and capped noneconomic damages in medical malpractice cases to $500,000 for a doctor and $1 million for a hospital.

Gov. Rod Blagojevich signed the bill, an uneasy truce between lawyers and insurance companies, on Aug. 25, 2005, at a ceremony in Alton.

There’s no question that the landscape today has changed. The tally of medical malpractice lawsuits around the state has declined. The political rhetoric has subsided. Doctors are not fleeing the area. Some hospitals report finding new physicians is easier. More insurers are doing business in the state.

Perhaps most importantly, malpractice insurance premiums have stabilized or even fallen for many doctors, anywhere from 5 to more than 30 percent.

“We’ve seen dramatic improvement in the rates that are offered to the physician and surgeon community in the state,” said Michael McRaith, Illinois’ head of the Division of Insurance, which helps regulate medical malpractice insurance.

At the same time, the insurance industry’s profits generally have risen.

But just what parts of the 2005 law are the driving factor remains up for debate. McRaith said the provisions that opened Illinois insurance market to competition are key to the greater stability in today’s prices.

The effect of the caps, however, is uncertain. Trial lawyers have continually argued that the rate increases were a product of wider market conditions and not the result of any lawsuits. Too, the law only applied to new cases, and most medical malpractice claims filed after the bill was signed haven’t had a chance to percolate through the court system.

However, in about two weeks, one will finally go before a Cook County judge to test the law. A Chicago lawyer, Jeffrey Goldberg, has challenged the caps on behalf of an infant who was born with severe brain damage. Goldberg alleges a botched delivery and argues the caps simply don’t allow a jury to award enough money.

The attorneys for the doctor, hired by state’s largest medical malpractice insurer, ISMIE Mutual Insurance Co., will also be in the courtroom fighting to uphold the caps. ISMIE along with its parent, the Illinois State Medical Society, were some of the strongest supporters of the caps.

“We’ve got insurers coming back to Illinois. We’ve seen a moderation of premiums for many doctors,” said Dr. Rodney Osborn, head of the Illinois State Medical Society. “We need to keep this law in place.”

Though Goldberg is objecting to the caps alone, it’s unclear whether the judge could strike only that portion of the law. Interpretations vary, and it’s possible that if Goldberg wins, the provisions of insurance reform might also go, some officials said.

Too, the Sept. 17 court hearing is likely to be only the first salvo in a long legal battle. Previous medical malpractice damage caps were challenged all the way to the state Supreme Court, a battle that can take years.

“I’m comfortable with the thought that whatever side prevails on the 17th, there will be an appeal,” Goldberg said. “This won’t be settled quickly.”
see original