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The Schultz Perspective (February 17, 2023)

The Schultz Perspective by Senator Jason Schultz

After six years, the critical issue of tort reform has finally been put to rest.  Also referred to as medical malpractice liability reform, this issue has grown in importance to our local health care system and physicians.  HF 161 passed the House and Senate last week and was signed by the Governor on February 16.

I’ve written recently about the introduced bill.  The final bill had changes that made the bill better as compromises were reached.  As a reminder, liability awards contain three categories.  First are the economic damages, which can be traced and predicted.  These awards are unlimited and fit the actual and predicted financial loss of the patient or family.

Punitive losses also remain unlimited.  Trial lawyers complain that it is very difficult to prove intent to harm or gross negligence and that punitive awards are very rare.  It should be a high bar to prove that medical professionals cared so little about a patient or that they meant to harm someone.  These are very serious charges.  But I suspect there are so few awards because Iowa’s medical professionals do not harm anyone on purpose and care deeply for the level of care they provide.  They care mostly about the patient, but their name and reputation are on the line with each decision.  I can’t believe there are many credible claims for punitive damages.

The final bill did address this subject, however.  Through discussion and negotiations it was learned that when punitive damages are granted, as much as 70% of the award goes to the state, not the patient or family.  This had never been part of the discussion before.  This is part of the reason lawyers try to move their punitive damage complaints to the emotional realm of noneconomic damages.  They can’t collect a third or more of the state’s share of the punitive amount.  HF 161 makes the punitive award go fully to the patient.  This is how it should be.  The patient or family still must pay their attorney, but that isn’t the point of the bill.

HF 161 places a cap on the noneconomic damages such as emotional pain, loss of consortium, and other, non-quantifiable losses.  The caps ended up being $2 million against a hospital, or $1 million against other health care providers.  Hospitals themselves offered this concession, which shows again how badly they needed relief from uncapped emotional awards from juries who have given tens of millions of dollars in some instances.  This category is why insurance is becoming not only expensive enough to force closure of some of our rural health providers, but sometimes is simply unattainable for our most sensitive services such as birth centers.

One new provision is the formation of a task force that will quantify the injuries suffered through medical mistakes and report if there was any state policy that would have prevented such losses.  I’m interested in hearing the results and am glad it was included.

The environment has now changed for western Iowa in health care.  When we began session there was no reason a medical professional would come here from another state due to our uncapped medical liability environment.  With this change I expect we will see the recruitment and retaining of health care professionals become easier as we now are similar to Nebraska and South Dakota.  They still have lower caps, but Iowa is now in the ballpark.  Council Bluffs and Sioux City will be the first beneficiaries of the new policy.  It won’t take long and our local hospitals in Ida Grove, Denison, Harlan, Carroll, and Audubon to see the effects of HF 161.

It was difficult and was a six-year project, but of all the challenges faced by health care, I’m glad to report that uncapped noneconomic damages will no longer scare away new doctors or close emergency rooms or birthing centers.  Our residency training programs will also benefit, which helps keep Iowa trained doctors working in Iowa.

The hustle of session continues as we are within a couple of weeks of the first funnel deadline.  There are plenty of issues to report in the coming weeks.  Please check back for updates soon.  I appreciate having the chance to report back home to western Iowa.

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