The legal history of Kansas caps

0 | Health Care Delivery, Hospitals

Jerry Slaughter of the Kansas Medical Society told members of the Kansas Health Policy Authority that doctors are worried the Kansas Supreme Court will soon overturn a long standing cap on the damages that can be awarded to victims of medical malpractice. If that happens in a way that the Legislature cannot quickly remedy, he said, the medical society has a proposed constitutional amendment ready to go.

Jerry Slaughter of the Kansas Medical Society told members of the Kansas Health Policy Authority that doctors are worried the Kansas Supreme Court will soon overturn a long standing cap on the damages that can be awarded to victims of medical malpractice. If that happens in a way that the Legislature cannot quickly remedy, he said, the medical society has a proposed constitutional amendment ready to go.

— The Miller v. Johnson case isn’t the first time the question of caps on medical malpractice awards has been before the Kansas Supreme Court.

The 1986 law that created the current $250,000 limit on awards for pain and suffering also capped at $1 million the amount that victims could recover for actual damages such as medical expenses or lost income.

In a 1988 case, Kansas Malpractice Victims Coalition v. Bell, the court threw out the $1 million cap on actual damages, something Gov. John Carlin had predicted was unconstitutional when he signed the legislation into law in 1986.

The court ruled that while non-economic damages could be capped, economic damages – those tied to actual expenses, present and future, could not.

In the 1990 case, Samsel v. Wheeler Transport Services, the court upheld the $250,000 limit, which is now being contested by a Douglas County woman who had the wrong ovary removed during a surgery.

Doug Samsel, a Fort Riley soldier, was paralyzed from the neck down after a semi truck crossed the centerline, hitting his vehicle head on.

In the Samsel decision, the court said the cap did, in fact, discriminate against those who were “most severely disabled and injured.” But it also said it was up to the Legislature – not to the court - to address the disparity.

No adjustments

So far, the Legislature has resisted increasing the 22-year-old cap or adjusting it for inflation.

“In today’s dollars, that $250,000 is $137,000 – that’s not what the Legislature voted for,” said Brad Prochaska, a Wichita attorney and president of the Kansas Association for Justice, formerly known as the Kansas Trial Lawyers Association. “If you tied it to the Consumer Price Index, the cap should be $453,000.

“Samsel was wrongly decided,” Prochaska said, “A mistake was made.”

But according to Bruce Kiplinger, attorney for the Kansas Medical Society, the Samsel decision remains valid and should not be overturned.

“The way our federal system is set up, there is an extraordinary amount of power in a state legislature,” Kiplinger said. “That shouldn’t be interfered with by either the federal government or the state supreme court. If the Legislature wants to pass a bill that puts a cap in place, it can do that. If it wants to pass a bill that takes away or modifies the cap it can do that. If it wants to keep it in place, it can do that too.”

Those who think the cap is unjust, he said, should take their case to the Legislature, not to court.

“They have a perfect democratic right to address the Legislature about that – that’s the way to change this,” Kiplinger said. “It’s not by trying to turn the Supreme Court into a third legislative body, which is what the plaintiffs are trying to do here.”

But Bill Skepnek, plaintiff’s attorney in Miller v. Johnson, said the issue isn’t whether the cap is inadequate, it’s whether it’s constitutional.

“It says in the Kansas Constitution that ‘The right of trial by jury shall be inviolate,’” Skepnek said. “So if a jury listens to all the evidence and decides it wants to give somebody $500,000 but the Legislature says, ‘No, you can only give them $250,000,’ how does that not violate that individual’s right to a jury trial?”

Truck drivers, too

Prior to Samsel and the Kansas Malpractice Victims Coalition cases, the court ruled that limiting the cap to medical malpractice cases was unconstitutional because it created unequal protection under the law. The cap, it said, couldn’t affect just doctors; it had to be equally applied to other professions – engineers, accountants, or truck drivers, for example – and their insurers.

To keep the cap in place, legislators expanded it to include personal injuries of all kinds, not just medical malpractice. Now, someone who’s left quadriplegic after being hit by a truck driven by a drunk driver and a woman whose ovary is wrongly removed are now subject to the same limit on non-economic losses.

Someone who loses the use of one leg and someone who loses the use of both legs are each limited to $250,000 in non-economic losses.

Washburn University constitutional law professor Bill Rich said he’s troubled by the disparity.

“What bothers me the most in this is when people, often in the same breath, talk about frivolous lawsuits, tort reform, and the need for a cap,” Rich said. “It’s not the frivolous lawsuits that result in high judgments. It’s the lawsuits in which the people are the most severely injured that result in the high judgments. They are the only ones affected by the cap.

“You can have what some might consider a frivolous lawsuit and still get up to the $250,000 limit. They’re not affected at all by the cap,” he said. “Anybody who tries to argue those two things as if they’re part of same issue simply doesn’t understand or is trying to mislead.”

Before and after

During the legislative debate in 1986, the Kansas Medical Society released a report, showing the number of malpractice claims filed in Kansas rose from 26 in 1979 to 156 in 1983 and that total awards rose from $2.35 million to $14.71 million over the same period.

Prochaska said legislators and later the court bought the argument that without a cap medical malpractice rates would skyrocket and doctors would flee the state, threatening the public’s access to health care.

In Samsel, he said, the court ruled that ensuring access to health care was enough of a quid pro quo to allow limiting a jury’s power in a malpractice case.

But there was little evidence, Prochaska said, that jury verdicts were out of control or driving up insurance premiums. The increase in premium costs, he said, had far more to do with insurance company investment losses.

“The medical society scared legislators into thinking that without a cap, their children and grandchildren would not be able to see a doctor and that was simply not the case,” Prochaska said.

Recent numbers show that the number of malpractice cases involving Kansas doctors that went to trial were close to the total number of malpractice claims filed in 1979.

According to the Health Care Stabilization Fund’s annual report, 27 malpractice cases went to jury trial in fiscal 2009. Juries sided with the plaintiffs in five of the 27 cases.

By far, the largest award – $12 million – was reached in U.S. District Court. Verdicts in the remaining four cases totaled $4.9 million.

Eighty-one claims were settled out of court, costing the stabilization fund $23.9 million, almost $300,000 per claim. That’s about $50,000 less than the average claim settlement between 1991 and 1995.

“The doctors in Kansas cannot point to a single verdict that was excessive before or after the cap,” said Larry Wall, a Wichita plaintiff’s attorney.

“Subjective process”

Slaughter defended the current arrangement, noting the cap only applies to non-economic damages, which “can’t really be quantified. There isn’t a metric or a standard that applies. It’s a subjective process.”

At the same time, he said, the cap does not limit a plaintiff’s access to “actual damages – things like medical expenses, rehabilitation costs, lost earnings. All of those things are fully recoverable.”

The cap, Slaughter said, doesn’t eliminate non-economic damages; instead, it makes them predictable.

“It’s a reasonable limitation, it’s a balance,” he said. “Without it, jury verdicts would be unpredictable and that would create a lot of volatility, which would put us back where we were in the 1980s when all this started.”

Slaughter said debate leading up to enacting the cap in 1986 was long, deliberative and often contentious.

“I remember I went in to see John Carlin, who was governor at the time, and he told me flat out that he’d veto it,” said Slaughter, who’s represented the medical society since 1973. “And I said, ‘Well, sorry, we’ll go for an override.’”

Ultimately, the bill passed by veto-proof margins: 92-32 in the House, 31-9 in the Senate.

Legislators, Slaughter said, thoroughly understood both sides of the issue.

“This thing was put through the public-policy wringer,” he said.

But if that were the case, Prochaska asked, why wasn’t the cap tied to inflation? And why have legislators consistently resisted raising the cap, which has not been adjusted in 22 years?

Slaughter said if the cap “needs to be tweaked or adjusted,” the medical society would be “happy to be a part of those discussions.”