Fixing California’s Tort Reform

May 17, 2014

California’s referendum initiative to make an inflation-based adjustment to the state’s 39-years old $250,000 cap on noneconomic damages for medical malpractice moves forward. See here.

The California Medical Association (CMA) unsurprisingly opposes this initiative. According to CMA, “The $250,000 cap on non-economic damages is an effective way of limiting frivolous lawsuits.”

This is hilarious. I am yet to see a frivolous plaintiff who looks down at a $250,000 windfall. Discouraging frivolous suits by capping noneconomic compensation is as good as deterring hypochondriacs and malingerers by kicking them out of the doctor’s office after five consecutive visits. The best way to deter frivolous medical-malpractice suits is to set up a categorical rule that requires plaintiffs to file an affidavit from a qualified medical expert that verifies the complaint against the defendant physician by specifying her deviation from the medical profession’s practices and protocols. This suit-screening rule has proven most effective both in theory and as an empirical matter. Unlike many other states, California has not yet implemented it, though. Therefore, instead of trying to defend California’s unreasonable cap, CMA will do well to urge the legislature to implement this rule.

The $250,000 limit on noneconomic compensation is arbitrary and unconscionable. When John Doe is killed while crossing the street on a green light, his widow will recover from the reckless driver $1M or a close amount for her lost consortium. Why should she recover less money when her husband is killed by a reckless doctor who forgot to take a biopsy and allowed John to develop incurable cancer?

Two months ago, the Florida Supreme Court decided that Florida’s $1M cap on noneconomic damages for a patient’s wrongful death violates equal protection. For my discussion of that important decision, see here. This decision is remarkable in its reliance on empirical research that discredits the factual claims underlying the tort reform. I estimate that this decision will be used to revive constitutional attacks on the caps in other states as well. California’s $250,000 cap is particularly vulnerable to this renewed attack.

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