TORT REFORM UPDATE JUNE 25, 2004

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TORT REFORM UPDATEJUNE 25, 2004

• Robert W. Kerpsack, Esq.
• ROBERT W. KERPSACK CO., L.P.A.
• 21 East State Street, Suite 300
• Columbus, OH 43215
• Telephone [phone]
• Facsimile [phone]
• Email bob_at_rwklaw.com

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TORT REFORM UPDATE TOPICS

• S.B. 281 MEDICAL MALPRACTICE LIABILITY
• H.B. 412 NURSING HOME LIABILITY
• S.B. 179 HOSP. LIAB./PHYSICIAN CREDENTIALING
• S.B. 227 WORKERS COMP. SUBROGATION
• H.B. 51 SAVINGS STATUTE/CIV. R. 41 DISMISSAL
• H.B. 212 PREJUDGMENT INTEREST
• PENDING TORT REFORM LEGISLATION

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MED MAL REFORM

• S.B. 281 HIGHLIGHTS
• Effective April 10, 2003
• Caps on noneconomic damages
• Limits on future damages
• 4-year statute of repose
• Good faith motions
• Non-subrogated collateral sources admissible
• Clerks annual med mal report

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MED MAL REFORM CAPS ON NONECONOMIC DAMAGES

• LIMITS ON CATASTROPHIC INJURIES
• 500,000 each plaintiff/1M each occurrence
• __________________________________
• CATASTROPHIC means
• Permanent and substantial physical deformity,
  loss of use of a limb, or loss of a bodily organ
  system
• or
• Permanent physical functional injury that
  permanently prevents the injured person from
  being able to independently care for self and
  perform life-sustaining activities.

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MED MAL REFORMCAPS ON NONECONOMIC DAMAGES (cont)

• NOTE
• Prior to trial, any party may seek summary
  judgment on the issue of whether the claimed
  injury or loss is catastrophic.

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MED MAL REFORMCAPS ON NONECONOMIC DAMAGES (cont)

• NON-CATASTROPHIC INJURIES
• The greater of
• 250,000, or
• 3 x amount of Economic Loss
• Up to a maximum of
• 350,000 each plaintiff/500,000 each occurrence

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MED MAL REFORMCAPS ON NONECONOMIC DAMAGES (cont)

• SPECIAL JURY INTERROGATORIES REQUIRED
• General verdict in favor of Plaintiff must be
  accompanied by answers to interrogatories
  specifying
• 1) Total compensatory damages
• 2) Portion of total compensatory damages
• that represents damages for economic loss
  and
• 3) Portion of total compensatory damages
• that represents damages for non-economic
  loss.

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MED MAL REFORMCAPS ON NONECONOMIC DAMAGES (cont)

• NO JUDICIAL DISCRETION
• R.C. 2323.43(D)(1) provides that a trial court
  has no jurisdiction to award noneconomic
  damages in excess of the imposed caps.
• R.C. 2323.43(D)(2) provides that the jury shall
  not be informed of the noneconomic loss caps.
• R.C. 2323.43(E) provides that noneconomic damages
  awarded in excess of the caps shall not be
  reallocated to any other tortfeasor(s).

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MED MAL REFORMCAPS ON NONECONOMIC DAMAGES (cont)

• R.C. 2323.43s caps on noneconomic damages not
  applicable to
• 1) Wrongful death claims and
• 2) Claims against the State of Ohio.

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MED MAL REFORMLIMITS ON FUTURE DAMAGES

• R.C. 2323.55s discretionary order of a series of
  periodic payments on future damages is applicable
  to
• Future Damages in excess of 50,000
• Total future damages for both economic and
  noneconomic losses

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MED MAL REFORMLIMITS ON FUTURE DAMAGES (cont)

• SPECIAL JURY INTERROGATORIES REQUIRED
• General verdict in favor of Plaintiff must be
  accompanied by answers to interrogatories
  specifying
• 1) Total past compensatory damages
• and
• 2) Total future compensatory damages.

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MED MAL REFORMLIMITS ON FUTURE DAMAGES (cont)

• BEFORE JUDGMENT IS ENTERED on a verdict including
  future damages in excess of 50,000
• Any party may file a motion for a hearing re
• Whether any or all of the future damages will be
  received in a series of periodic payments.
• If a periodic payment motion is timely filed,
  then court must schedule a hearing.

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MED MAL REFORMLIMITS ON FUTURE DAMAGES (cont)

• FACTORS for Court to consider in exercising
  discretion whether to order periodic payments of
  future damages
• Purposes for which future damages awarded
• Business or occupational experience of Plaintiff
• Plaintiffs age
• Plaintiffs physical and mental condition
• Competency of Plaintiff, parent, guardian, or
  custodian to manage the future damages and
• Any other relevant circumstances.

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MED MAL REFORMLIMITS ON FUTURE DAMAGES (cont)

• PERIODIC PAYMENT PLAN
• Within 20 days of courts order that future
  damages are to be paid in a series of periodic
  payments, the plaintiff must submit a periodic
  payment plan.
• A periodic payment plan approved by the court
  must include adequate security to insure the
  future payments.
• Periodic payment plans shall include
  post-judgment interest, in accordance with R.C.
  1343.03 (currently 7)

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MED MAL REFORMLIMITS ON FUTURE DAMAGES (cont)

• R.C. 2323.55s discretionary periodic payment
  plan for future damages is NOT APPLICABLE to
  civil claims against
• 1) Political subdivisions and/or
• 2) State of Ohio.

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MED MAL REFORM4-YEAR STATUTE OF REPOSE

• S.B. 281 ADDS R.C. 2305.113, which reinstitutes
  an absolute four-year statute of repose on med
  mal claims.
• Only three (3) exceptions
• 1) Minors or persons of unsound mind
• 2) Discovery
• One year from injury discovered within 3 to 4
  years
• Injury discovered after 4 years is time-barred
• 3) Foreign objects
• 1 year after discovery of foreign object

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MED MAL REFORM4-YEAR STATUTE OF REPOSE (cont)

• S.B. 281 RETAINS 1-year SOL and 180-day notice
  provision for extending the SOL on medical
  claims.
• NOTE S.B. 281 prohibits a med mal insurance
  company from considering the receipt of a 180-day
  notice letter as a factor in establishing
  liability insurance premium rates.

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MED MAL REFORMREASONABLE GOOD FAITH BASIS

• S.B. 281 ADDS R.C. 2323.42, which includes
  requirement of reasonable good faith basis for
  bringing med mal claim.
• Med Mal defendant may serve Plaintiff with a
  Notice of Demand for Dismissal and Intention to
  File a Good Faith Motion.
• If Plaintiff does not dismiss Defendant within 14
  days, then Defendant may file a good faith
  motion, contending that Plaintiff lacked a
  reasonable good faith basis for bring the action.
• Good faith motion may be filed between close of
  discovery and 30 days after verdict.

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MED MAL REFORMREASONABLE GOOD FAITH BASIS
(cont)

• COURT must conduct a hearing on good faith
  motions
• Factors for court to consider in deciding good
  faith motion
• Whether Plaintiff obtained timely review by
  qualified expert
• Whether Plaintiff conducted pre-suit
  investigation or was afforded full, timely
  discovery during litigation
• Whether Plaintiff reasonably relied on evidence
  and
• Whether Plaintiff timely dismissed Defendant
  upon learning that no good faith basis existed
  for claim.

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MED MAL REFORMREASONABLE GOOD FAITH BASIS
(cont)

• IF COURT DETERMINES
• No reasonable good faith basis for asserting or
  continuing to assert a med mal claim
• The moving defendant is entitled to court costs
  and reasonable attorneys fees incurred in the
  defense of the med mal claim and in asserting the
  good faith motion.

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MED MAL REFORMCOLLATERAL SOURCES OF RECOVERY

• S.B. 281 ADDS R.C. 2323.41, which permits med mal
  defendants to introduce evidence to the jury of a
  plaintiffs non-subrogated/reimbursable
  collateral sources of recovery.
• If evidence of a collateral source of recovery is
  admitted, then a plaintiff may introduce evidence
  of the cost (i.e. premium amount) of the
  collateral source.

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MED MAL REFORMCLERKS ANNUAL MED MAL REPORT

• S.B. 281 ADDS R.C. 2303.23, which requires the
  Clerk of every Court of Common Pleas to file an
  annual med mal report with the Ohio Department of
  Insurance.
• Clerks report must provide detailed info re
  pending med mal claims (i.e. case number, filing
  date, trial date, current status, settlement,
  judgment, and appeal).
• 5.00 is to be added to the filing fees for
  medical claims to offset the costs associated
  with the required reporting.

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NURSING HOME LIAB. REFORM

• H.B. 412 HIGHLIGHTS
• Effective November 8, 2002
• Same SOL applicable to med mal claims
• Punitive damages Financial ability of nursing
  home to stay in business is relevant evidence
• Results of official inspections, investigations,
  and surveys not admissible in civil actions
  against the home
• Attorney fees may be awarded for injunctive
  relief, but not for damages
• If Ohio Department of Job and Family Services
  must receive written notice of residents civil
  action if it is paying the care and treatment
  bills

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NURSING HOME LIAB. REFORMRESIDENTS RIGHTS

• Nursing Home Residents Rights Act--R.C. 3721.13,
  et seq.
• The rights of nursing home residents are
  delineated in the 32 subsections of R.C.
  3721.13(A)
• Civil liability can arise under (A)(3) Right to
  adequate and appropriate medical treatment and
  nursing care. . .
• A nursing homes violation of R.C. 3721.13(A)(3)
  probably constitutes negligence per se.

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NURSING HOME LIAB. REFORMONE-YEAR SOL

• H.B. 412 EXPANDS R.C. 2305.11(D)(3)S definition
  of a medical claim to include claims for a
  violation of residents rights against a home
  or residential facility.
• Same one-year med mal SOL (and 180-day notice
  extension) is attributable to claims alleging a
  violation of nursing home residents rights.
• Exception Wrongful death claims are still
  subject to the two-year SOL set forth in R.C.
  2125.02(D).

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NURSING HOME LIAB. REFORMPUNITIVE DAMAGES

• H.B. 412 ADDS 2315.21(E)(1) (3)
• Punitive damages are still recoverable for a
  violation of a nursing home residents rights.
• But, the jury must consider the following FACTORS
  in determining whether to award punitive damages
• 1) Nursing homes assets, income and net worth
• 2) Whether the punitive damages will deter
  future
• tortuous conduct and
• 3) The financial ability of the nursing home to
  remain
• in business.

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NURSING HOME LIAB. REFORMADMINISTRATIVE
VIOLATIONS

• H.B. 412 ADDS R.C. 3721.02(E)(1) and 5111.411
• Official findings of a nursing homes
  violations of state and federal regulatory
  statutes are not admissible in civil actions
  against the home for alleged violations of a
  residents rights.

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NURSING HOME LIAB. REFORMRESIDENTS REMEDIES

• H.B. 412 ADDS/AMENDS R.C. 3721.17(I)(2)(a) and
  (c)
• Both injunctive relief and compensatory damages
  are available for a violation of a residents
  rights.
• However, attorneys fees may be awarded only for
  injunctive relief imposed.
• Prior law Permitted attorneys fees to be
  awarded to the prevailing party.

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HOSPITAL LIABILITY REFORM(NEGLIGENT PHYSICIAN
CREDENTIALING)

• S.B. 179 HIGHLIGHTS
• Effective April 9, 2003
• Establishes a rebuttable presumption Hospital
  not negligent in extending hospital privileges to
  a physician
• Establishes confidentiality and inadmissibility
  of peer review committee proceedings and risk
  management reports

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HOSPITAL LIABILITY REFORM (cont)(NEGLIGENT
PHYSICIAN CREDENTIALING)

• JOINT COMMISSION ON ACCREDITATION OF HEALTHCARE
  ORGANIZATIONS (JCAHO)
• Establishes national hospital quality
  standards.
• JCAHO accreditation teams conduct on-site
  reviews of a hospital practices at least once
  every 3 years.

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HOSPITAL LIABILITY REFORM (cont)(NEGLIGENT
PHYSICIAN CREDENTIALING)

• JCAHO STANDARDS REQUIRE Hospitals to form
  PEER REVIEW COMMITTEES to investigate the
  credentials of physicians applying (or
  re-applying) for hospital privileges.
• S.B. 179 AMENDS R.C. 2305.251(B)(1) to create a
  rebuttable presumption that JCAHO-accredited
  hospitals are not negligent in credentialing and
  granting of privileges to physicians.
• However, JCAHOs accreditation process does not
  specifically include a review of the competency
  of the doctors with hospital privileges.

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HOSPITAL LIABILITY REFORM (cont)(NEGLIGENT
PHYSICIAN CREDENTIALING)

• S.B. 179 ADDS/AMENDS R.C. 2305.252
• Prohibits the discovery/introduction of any
  evidence (records or testimony) flowing from a
  hospitals peer review committee.
• S.B. 179 ADDS R.C. 2305.253
• Prohibit the discovery/introduction of any
  evidence (reports or testimony) flowing from a
  hospitals risk management office.

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WORKERS COMP. SUBRO. REFORM

• S.B. 227 HIGHLIGHTS
• Effective April 9, 2003
• Establishes pro-rata sharing of limited tort
  recoveries
• Establishes an option to establish an
  interest-bearing trust for future estimated
  future subrogated workers compensation benefits
• Requires the Ohio Attorney General to be notified
  of potential tort claims
• Specifies that workers comp. benefits are
  subrogated against employer intentional tort
  claims.

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SAVINGS STATUTE REFORM

• H.B. 161 MODIFIES R.C. 2305.19(A) (Savings
  Statute)
• Effective June 1, 2004
• A plaintiff may re-file a claim one year after a
  dismissal (failure otherwise than upon the
  merits) or within the period of the original
  statute of limitations, whichever occurs later.
• Cures the legal malpractice trap of filing a
  Civ. R. 41 dismissal before the statute of
  limitations had run on a civil cause of action.

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PRE/POST-JUDGMENT INTEREST REFORM

• H.B. 212 AMENDS R.C. 1343.03(A)(D)
• Effective June 2, 2004
• Rate of Interest (if not specified) federal
  short-term rate, as determined by the Ohio Tax
  Commissioner on Oct. 15 of each year (currently
  4) 3 7
• Date from which pre-judgment interest is due
• Contract claims Date money became due and
  payable
• Tort claims Admitted liab.Date accrued
• Contested liab.Longer of the
  following
• 1) Date of written notice of claim
• (in person or by certified mail) or
• 2) Date of filing of Complaint
• No pre/post judgment interest on future tort
  damages

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MORE MED MAL REFORM PENDING

• H.B. 215 Signed by Gov. 6/14/04 Effective
  9/13/04
• Provides that statements of apology/sympathy by
  med mal defendant are not admissions of liability
• Provides that out-of-state medical experts are
  temporarily licensed and subject to the
  authority of State Med. Board
• Provides procedure for motions for dismissal
  due to non-involvement
• Requests OH Sup. Ct. to amend the Rules of
  Civil Procedure to require med mal Plaintiffs to
  file certificates signed by a medical expert
  confirming the merits of the med mal claim(s).