Missouri Supreme Court Overturns Damage Cap, Doctors Fear Malpractice Insurance Rates Will Skyrocket

On July 31, the Missouri Supreme Court ruled that the state’s $350,000 cap on non-economic damages in medical malpractice lawsuits is unconstitutional. The non-economic damage cap was passed as part of a series of comprehensive tort reforms passed in 2005 and signed into law by then-Gov. Roy Blunt.

Non-economic damage caps bring predictability to a state’s medical liability damages as well as claims frequency, allowing medical malpractice insurance companies to set lower medical malpractice insurance rates because they do not have to factor in the possibility of jackpot, seven-figure jury verdicts. The Missouri Supreme Court’s decision overturning the non-economic damage cap will likely have an inflationary effect on Missouri’s medical malpractice insurance rates.

At the heart of the case is a 2006 jury verdict in the case of a brain-damaged infant. The baby’s mother sued the hospital that delivered her child on the basis that the hospital provided negligent care. The jury agreed, awarding the child $1.45 million in non-economic damages. The judge reduced the dollar amount to $350,000, in keeping with Missouri’s non-economic damage cap in cases of medical malpractice. The mother appealed the reduction in non-economic damages.

The Missouri Supreme Court’s decision to overturn the non-economic damage cap hinged on the state’s constitution, which was established in 1820 and grants its citizens an inviolable right to a trial by jury. The justices in the majority argued that to take away the jury’s ability to set compensation in medical malpractice cases violates the plaintiff’s inviolable right.

In the wake of this recent decision, tort reform advocates have argued the state supreme court had violated 20 years of precedent, as the Missouri Supreme Court had upheld the constitutionality of damage caps in a 1992 case. In breaking from precedent, Chief Justice Richard Teitelman said the 120-year-old decision was wrong. In his opinion, he cited similar high court decisions in Florida, Washington, Oregon and Alabama.

In response to the decision, the hospital at the center of the medical malpractice lawsuit released a statement saying that this decision will adversely affect every hospital and physician in Missouri.

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