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Many States Look to California When Considering Medical Malpractice Insurance Reform

California has served as an example for many states considering medical malpractice insurance reform, since this state was one of the first to legislate a cap on non-economic damages payouts for medical malpractice victims. In 1975, California passed a $250,000 cap on “pain and suffering” damages in medical malpractice lawsuits. While many supporters of such caps (including Florida governor Jeb Bush) hold this decision up as an example, they often fail to mention other California reforms, or the problems that haveaccompanied the caps on non-economic damages.

The 1975 legislative decision to cap payouts also limits medical malpractice attorneys fees to a sliding scale that decreases the percentage they can charge as the amount of money awarded goes up, leading many medical malpractice attorneys to refuse meritorious cases as not cost-effective. In addition, California voters mandated an insurance reform in the 1980’s that rolled back insurance rates, a move that many credit with lowering insurance premiums more effectively than the payout caps. “We are the poster child for the nation, but everyone is looking at the wrong poster,” says Doug Heller, senior consumer advocate for the Santa Monica-based Foundation for Taxpayer and Consumer Rights. “The solution to soaring medical malpractice rates is not to limit injured victim’s rights but a real-solution limit to insurance companies’ rates.”


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