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Malpractice cap limits legal options

Dave Stewart's 72-year-old mother went to Stanford University Medical Center for double knee-replacement surgery in April. Four days later, she was dead.

To Stewart, an anesthesiologist, it seemed a classic case of medical malpractice. After the operation, his mother developed sharp abdominal pain that she described as "10 on a scale of 1 to 10," according to her medical records.

The hospital failed to diagnose the cause of her pain and continued to treat her with narcotics. Her vital signs became unstable and she was moved to the intensive care unit, but she died of complications from an untreated bowel obstruction. California state regulators cited the hospital in the case this fall.

Stewart and his two sisters decided to sue, and they approached two dozen lawyers. One after another declined to take the case, always for the same reason: It wasn't worth the money.

In 1975, California enacted legislation capping malpractice payments after an outcry from doctors and insurers that oversize awards and skyrocketing insurance rates were driving physicians out of the state.

The law limited the amount of money for "pain and suffering" — usually the physical and emotional stress caused from an injury — to $250,000. There is no limit on what patients can collect for loss of future wages or other expenses.

Over the years, it has been easy to quantify the effects of the law, known as the Medical Injury Compensation Reform Act, or MICRA. In the years since the law was enacted, malpractice premiums in California have risen by just one-third of the national average, and doctors say the law now helps attract physicians to the state. Proponents also say it discourages frivolous lawsuits.

Thirty states have enacted similar legislation. Two Republican presidential candidates — Mitt Romney and Rudolph W. Giuliani — recently endorsed the approach as a possible national model.

It's been harder to tally the law's costs. Critics say it has prevented some victims and their families from getting their day in court, especially low-income workers, children and the elderly. Their reasoning: The cap on pain and suffering has never been raised nor tied to inflation.

At the same time, the costs of putting on trials are often paid by attorneys and continue to rise each year. That means those who rely mainly on pain-and-suffering awards — typically people who didn't make much money at the time of their injury — are increasingly unattractive to lawyers.

Several states have set their malpractice caps considerably higher than California's because of worries that they affected poorer patients most. Some state courts have begun to examine the fairness of their malpractice laws, especially those not tied to inflation. California lawmakers rarely have reconsidered the state's malpractice legislation.

Yet a Los Angeles Times analysis of state court records, physician payment data and insurer financial records suggests that the cap increasingly is preventing families such as the Stewarts from getting their day in court.

Among the findings:

— Court malpractice filings have fallen in eight of the 10 most populous counties in California that track such information. In Los Angeles, they're down 48 percent since 2001 to their lowest per-capita level in nearly four decades. In Orange County, they fell 29 percent over the same period.

— At Kaiser Permanente, where members must resolve malpractice claims in arbitration rather than court, claims have fallen almost 20 percent since 2001.

— The number of payments to victims and their families across the state was down 24 percent since 1991, according to a review of a federal government database of nearly a half-million claims. Nationally, the decline over the same period was 10 percent.

— The malpractice revenue of California insurers has far outpaced national averages in recent years. According to financial reports, insurers in the state have paid out just 39 cents of every premium dollar since 1991. The national average was 63 cents.

Proponents of the law attribute the state's recent decline in malpractice lawsuits to several reasons unrelated to its award cap, including a slight drop in overall personal-injury cases nationwide and a possible decrease in medical errors in recent years.

Some states have seen larger per-capita declines in malpractice cases than California after they enacted caps on medical malpractice awards.

A spokesman for Kaiser Permanente said its drop in malpractice filings was the result of a company program begun five years ago in which doctors apologize to patients for errors rather than wait to fight the accusations in court.

Some malpractice victims and their families say the benefits of the law have swung too far in favor of doctors. Without accountability, some say, what will keep physicians from making careless mistakes?

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Craig Backer of Caliente, Calif., suffered headaches for five years and eventually lost hearing in his left ear. Although the former Marine visited the Veterans Administration hospital a half-dozen times, doctors told him his condition was temporary and never performed advanced screening tests, according to his family.

Last spring, Backer began having problems with his vision and returned for a battery of exams. Doctors discovered that he had a large brain tumor and scheduled surgery days later. It was successful, but Backer remains in the hospital and can't talk. He is also learning how to swallow again and the left side of his face droops. Doctors say they don't know if he will improve.

His wife, Jeriah, wants to sue, but the case is subject to California's malpractice cap. Six lawyers have turned her down. One told her that, because her husband didn't earn a large income as a mechanic, the case wasn't feasible.

"We're living a nightmare," she said.

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Linda Fermoyle Rice, one of California's best-known malpractice lawyers, says the law often leads to difficult trade-offs.

"It has had the effect of making an infant who is severely injured more valuable than those who don't make it, since families of children who die are limited to the cap," said Rice, who is based in the Los Angeles area. "It's sad to say, but most attorneys I know won't take a dead-baby case."

A 2003 Rand Corp. report found that the law had reduced jury awards by 30 percent and that the savings had come largely at the expense of severely injured or impaired patients.

On average, California juries (which rarely are informed of the cap during trials) awarded $800,000 in malpractice death cases from 1995 to 1999, but the amounts were later reduced to $250,000 under the law. This suggests that medical malpractice victims and their families could be reaping much larger payouts than the law allows. But proponents of MICRA say raising the cap could harm patients.

"Raising the MICRA cap would significantly increase health-care costs, limiting patient access to doctors, hospitals and clinics throughout California," said Lisa Maas, executive director of Californians Allied for Patient Protection, a trade group. "MICRA protects patient access to health care."

Stewart, of San Diego, said he had long been a MICRA advocate, believing it was in the best interest of doctors and patients. Not anymore.

After he and his family got over the initial shock of losing their mother, they wanted justice. Most attorneys turned them down over the phone, although three agreed to meet in person. This summer, the entire family and their 80-year-old father made the trip to the San Francisco Bay area for meetings.

One lawyer said he would take the case only if the family paid the expected $50,000 in trial costs upfront.

San Francisco lawyer Brad Corsiglia at first seemed interested but later sent a letter dated July 11, 2007, that read: "As you can understand, with a cap of $250,000, we are limited in the type of case we can take on a contingency fee basis to only those cases that involve catastrophic economic losses."

"In 1975 you could buy a house for that money, and today what does it get you?" said Stewart, whose parents would have celebrated their 54th anniversary last month. "Every year MICRA stays the same is another year that people who have been wronged will be denied the same justice."

Stanford Medical Center declined to comment on the case.

Times staff writers Doug Smith and Sandra Poindexter contributed to this report.

December 5, 2007. San Diego, CA. Dr. David Stewart, outside UCSD Medical Center where he works as an anesthesiologist. -- Story is about how CA medical malpractice law is making it harder for victims to get a lawyer and day in court. Dr. Stewart is a doctor who used to love the law. Now he is lobbying against it because his mother was killed at Stanford Medical Center in April and can t get a lawyer to take his case because she s elderly and can t show significant economic losses. - Los Angeles Times