Consumer Group Seeks to Change California’s Medical Injury Compensation Reform Act
The Medical Injury Compensation Reform Act was passed in 1975 to limit the rights of medical malpractice victims. A California injury lawyer examines how the law has impacted plaintiffs and discusses a consumer group’s proposed changes to the outdated law.
In 1975, California lawmakers passed the Medical Injury Compensation Reform Act (MICRA). MICRA was passed in response to a perceived “crisis” caused by rising medical malpractice insurance costs that threatened to drive doctors out of California or into retirement.
MICRA limited non-economic damages to $250,000, which meant that this was the maximum a plaintiff could recover for pain and suffering and other non-financial loss. Plaintiffs could still obtain additional monetary awards for lost income and loss of future earning potential and for past and future medical expenses, explains the California injury lawyer.
The $250,000 cap was not indexed to inflation, and the 74-year-old California assemblyman who sponsored the original law has spoken out to indicate his regret at this oversight. Because the law was not indexed to inflation, today the damage cap is the equivalent of less than $58,000 when measured in 1975 dollars. If the cap had kept pace with inflation, on the other hand, then it would be equal to $1.1 million today.
The low damages limit has made it very difficult for many people in California to take action when they have been injured due to medical error. For example, plaintiffs who have no earnings and who have no future medical expenses could recover a maximum of just $250,000 under MICRA, which can make it difficult for them to find a lawyer who will take on their case. One such plaintiff was 59-year-old Cali Andrist, who had a developmental age of four and who was allegedly killed because the hospital misdiagnosed her medical condition. Andrist’s family members were unable to take legal action because of the limits imposed by MICRA.
The limits have also resulted in many plaintiffs throughout California having the damages that a jury awards them slashed by millions of dollars. A 2004 Rand Corporation study revealed that this especially affected women because they tend to have higher pain and suffering awards than men. The study revealed that women’s damages awards were often cut by more than one-third while men’s damages awards were cut by only 25 percent. Kids, who have no lost income, are also disproportionately affected, with the Rand study revealing that damages awards to injured plaintiffs one year old or younger were slashed as much as 71 percent.
The problems with MICRA are clearly causing significant harm to large segments of the population. Arguments that raising the damages cap in California would increase healthcare costs are widely considered to be unsupported by data, and there is no indication that MICRA is keeping healthcare costs down. Insurance companies have not generally passed on any savings from damages caps to doctors, and, over the past 22 years, California malpractice insurers have paid out only an average of 36 cents of every premium dollar collected.
Proposed MICRA Reform
Because of the issues with MICRA, efforts are currently underway to reform the law. Consumer Watchdog is drafting a ballot initiative that it hopes to place before voters in the election held in November 2014. The goal of the initiative will be to raise the cap to $1.1 million, where it would be if it had been indexed to inflation. The initiative would also permanently index the cap to inflation to stop similar problems from occurring in the future, according to the California injury lawyer.
Both the medical and insurance industries are expected to speak out actively against the ballot initiative, so it remains to be seen if voters will take action to correct the problematic law and provide more protection for medical malpractice plaintiffs. Consumer Watchdog has also stated that it will not pursue the ballot initiative if California lawmakers act to reform the existing law. However, the Los Angeles Times reports that the chances of this are slim and that a costly initiative campaign is likely to occur next year when the question is put before the voters as to whether the law should change.
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