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ABA Hears Opposition to Damage Award Caps

August 9, 1993

NEW YORK (AP) _ Limiting damage awards to people injured by medical malpractice does not necessarily hold down the overall cost of health care, say lawyers who argue against such laws.

″Caps on medical malpractice claims will make no significant impact on the cost of health care,″ said Daniel Sevart of Wichita, Kan., one of more than 12,000 lawyers attending the American Bar Association’s annual meeting.

Chicago personal-injury lawyer Philip H. Corboy added: ″I’ve never found any victim who has been seriously injured and believes that their damages should be limited to some arbitrary figure of $250,000.

″This is really a fight between consumers who happen to be victims of civil wrongs and the insurance companies representing the health care industry,″ Corboy said. ″I know the complaint (from doctors): They only have one Mercedes.″

Many states in recent years have set limits on so-called non-economic damages in medical malpractice cases. Such damages are intended either to punish health-care providers who caused the injury or to compensate victims for non-financial losses such as pain and suffering. States don’t limit actual financial losses, such as hospital costs and lost earnings.

For some people - such as a homemaker who is blinded - non-economic damages are the main loss they suffer, Corboy said.

The ABA has long opposed limits on non-economic damages, and a working group released a report Sunday that said states with such limits are not seeing any overall drop in their health care costs.

″Caps on non-economic damages have not had the dramatic impact that supporters think,″ said Clifford D. Stromberg of Washington, chairman of the ABA’s working group of health care reform.

Massachusetts and California, which do limit such damages, saw their per- capita health care costs double between 1982 and 1990, the report said. Per-capita costs rose by about 95 percent in Arkansas, Kentucky and Mississippi, which do not have limits.

Medical malpractice insurance premiums are less than 1 percent of overall health costs, while administrative costs are one-fourth of the overall health care tab, Stromberg said.

″So if you really want a bang for the buck, (administrative costs are) where you look for the reforms,″ he said.

Sevart said only a small number of lawsuits result in large damage awards. The vast majority of medical malpractice cases are won by the defense or result in relatively small damage awards or settlements, he said.

Justin L. Vigdor of Rochester, N.Y., said he might favor some limits on malpractice damage awards if they were coupled with other changes, such as limits on the amount of money doctors can spend to defend against malpractice lawsuits.

Vigdor also suggested changes in trial procedures to shorten lawsuits and provide quicker payment for injuries.

″If they could develop a nice package of those things, that might be a fair approach to health care reform,″ Vigdor said.

Many lawyers expressed support for a health care plan that would provide coverage for all Americans.

The Clinton administration plans to unveil a health care plan next month that would require employers to provide health insurance to their workers. The plan is expected to involve health care provided through regional alliances that would emphasize prepaid care from networks of doctors and hospitals.

″I think there should be a fair system where everyone in the United States is guaranteed basic, universal health care,″ said Martin A. Schainbaum of San Francisco.

But Harriet E. Miers of Dallas said she was concerned that the proposed system might encroach on decisions that should be made by doctors and hospitals.

″Where judgment is such a big issue, it is very scary to think that a bureaucracy or non-professional could dictate what is required in a medical situation,″ she said.

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