Our Medical Liability System in Crisis
February 14, 2020 | All sides of workforce
Thanks to skyrocketing verdicts in medical malpractice cases, Iowa stands on the brink of a health care crisis. In just five lawsuits decided between 2017 and 2019, juries awarded plaintiffs more than $63 million for “non-economic damages.” While “economic damages” cover treatment costs and lost wages, “non-economic damages” are awarded for things that can’t be measured, like pain and suffering.
This trend is largely driven by plaintiff attorneys, some from out-of-state. Generally, a physician’s malpractice insurance policy has a $1 million to $2 million limit. Hospital policies also have caps. So when a jury awards massive damages, say $20 million, doctors and hospitals must pay the rest out-of-pocket.
This situation has a ripple effect statewide. Each malpractice insurance claim raises premiums for doctors and hospitals—costs which get passed on to Iowa patients. And, if a cash-strapped rural hospital gets hit with such a verdict, they’re more likely to stop offering expensive high-risk services, like obstetrics and other specialty care, forcing patients to travel long distances for treatment and putting their safety at risk.
There’s a simple solution, though: the Iowa Legislature can place a firm dollar limit, or “hard cap,” on non-economic damages in malpractice cases. Patients could still receive unlimited economic damages to cover treatment costs and lost wages, and they could still be compensated for pain and suffering when appropriate. But by placing a reasonable limit on non-economic damages, lawmakers can ensure fair awards for plaintiffs, providers and hospitals while keeping costs down for all Iowans.