THE SUPREME COURT last week refused to consider a case testing the constitutionality of California's medical malpractice statute. The law will remain in force and, because of the court's tacit approval, may become a model for other states that are grappling with the high cost of malpractice insurance.
California is not only the most populous state, it is also one of the most litigious. Doctors there have long protested the frequency and size of jury verdicts against them and the resulting escalation of insurance costs, and 10 years ago the state legislature enacted a statute directed at the problem.
The California law seeks, first, to strengthen state supervision of medical education, licensing and the disciplining of doctors in order to minimize medical injury. It also makes a number of changes in tort law designed to keep costs under control. Awards for pain and suffering, for example, are limited to $250,000; the statute of limitations is shortened; arbitration agreements between patients and doctors are encouraged; and payments over $50,000 are to be made on a periodic basis. The most controversial change however -- at least as far as the plaintiff's bar is concerned -- is a limitation on contingent fees to be paid to lawyers. These fees, a percentage of the total award, can be as high as 40 percent in cases involving $50,000 or less. Then the share gradually declines so that no more than 10 percent of an award over $200,000 can be claimed by an attorney.
California lawyers charged that this limitation unconstitutionally deprived plaintiffs of the right to legal representation, but the Supreme Court saw no such problem. It let stand the lower court opinion that the limitation on fees in no way deprived plaintiffs of legal assistance. In smaller cases, in fact, plaintiff attorneys would receive more under the statute than they had before. The provision, said the California court, was a reasonable way to ensure that injured parties receive a larger share of settlements.
Many states have, in the past 10 years, enacted statutes that are similar in intent to the California one. Medical malpractice litigation is a real problem not only for physicians, hospitals and their insurers but for everyone who must share the burden of rising medical costs driven, in part, by the practice of defensive medicine and escalating malpractice premiums. Now that the Supreme Court has declined to consider a constitutional challenge to the California statute, other states should be encouraged to explore remedial legislation.