Government Relations: The Ongoing Erosion of Liability Reform

Anne E. Bryant, Senior Director of Government Relations

Erosion of Tort ReformLegislative advocacy is essential to Physicians Insurance/MedChoice's purpose to protect, defend, and support our Members. We participate at both the national and state levels as a leading advocate in the judicial, legislative, and regulatory environment to ensure that the concerns of our Members are heard by lawmakers on issues that impact medical professional liability. As a mutual company, we are accountable and dedicated to the Members we serve. President Thomas Jefferson once said, “We in America do not have government by the majority. We have government by the majority who participate.” Physicians Insurance/MedChoice participates. 


In Washington, we are currently fighting SB 5059, legislation that would increase the amount of prejudgment interest on medical professional liability claims. If this legislation is passed, interest payments would calculate from “the date the cause of action accrued”—not, as currently, the date the judgment was entered. This would effectively incentivize plaintiffs to delay filing, litigating, or settling claims in a timely manner, adding to the continued inflation of damages and the erosion of liability reform efforts meant to resolve medical professional liability claims efficiently and to reduce the rising costs of healthcare. 

In November 2005, Washington State filed Initiatives I-336 and I-330, known as the Washington Medical Malpractice Act (I-336) and the Washington Negligent Health Care Act (I-330) respectively. I-336 would have established a government-run malpractice insurance program, imposed a “three strikes, you’re out” license revocation after three malpractice incidents, limited the number of expert witnesses, and required unnecessary reporting. I-330 would have limited non-economic damages in medical malpractice cases, limited attorney fees, changed the statute of limitations, and modified joint and several liability. Both election ballot initiatives in Washington were defeated. 

In 2006, following the defeat of I-336/I-330 in an effort to close the debate, the Washington State Legislature passed, and Governor Gregoire signed into law, HB 2292, known in the industry as Health Care Liability Reform Light, which allowed for the admissibility of an apology/sympathy and aimed to improve healthcare by increasing patient safety, reducing medical errors, reforming medical malpractice insurance, and resolving medical malpractice claims fairly without imposing mandatory limits on damage awards or fees. 

Since the passage of HB 2292, several components of Health Care Liability Reform Light have been ruled unconstitutional by the Washington State Supreme Court. And, in the years following, other liability reforms have been eroded or continue to be threatened in the Washington State judicial, legislative, and regulatory environment.  


During the height of the Covid-19 pandemic, the Oregon State Legislature, after several months of negotiations, was one of the few states unwilling to offer its physicians or healthcare providers any medical professional liability protections for those providing care during the national Covid-19 pandemic.
Further, in 2020, the Oregon Supreme Court, in Busch v. McInnis Waste Systems, Inc., began the erosion of the $500,000 non-economic damage cap for bodily injury in Oregon. Immediately after that, in 2021, the Oregon State Legislature passed SB 193, which removes and completely eliminates the $500,000 non-economic damage cap in Oregon. The Supreme Court and the Oregon State Legislature did not address the $500,000 non-economic damage cap for wrongful death; therefore, it remains in effect. We are continuously defending legislative proposals that increase or eliminate the $500,000 non-economic damage cap for wrongful death in Oregon. 


The most recent opportunity to protect, defend, and support our Members on issues that impact medical professional liability was the 2022 challenge to erode California’s Medical Injury Compensation Reform Act (MICRA) by increasing the $250,000 non-economic damage cap recoverable in bodily injury and wrongful-death actions and eliminating other effective liability reform components of MICRA. 

After several negotiations, effective January 1, 2023, the new non-economic damage cap for bodily injury will increase to $350,000 and then increase by $40,000 per year for the next 10 years until it reaches $750,000. The new non-economic damage cap for wrongful death will increase to $500,000 and then by $50,000 per year for the next 10 years until it reaches $1 million. After the 10-year period, both the bodily injury and wrongful-death non-economic damage cap will increase by 2% per year. The erosion of California’s MICRA cap on non-economic damages for bodily injury and wrongful death will negatively impact medical professional liability insurance rates by inflating bodily injury and wrongful death claims in California. 


California’s MICRA is the model upon which several states’ non-economic damage caps were set; it is also the model for any federal legislation on non-economic damage caps. Therefore, the states that have based their own non-economic bodily injury and wrongful-death caps on California’s MICRA are facing increased pressure for raising or even eliminating non-economic damage caps. Several states have already identified upcoming 2023 legislation that further erodes liability reform across our nation.

Comprehensive legislation that improves the liability system and promotes meaningful patient safety initiatives, similar to that of California’s Medical Injury Compensation Reform Act (MICRA), has been introduced in the new Congress as well as in the previous Congress. Legislative proposals have also been introduced that address telemedicine liability concerns as telemedicine services continue to expand. However, the current congressional environment is an obstacle for any successful passage of liability reform measures in the near future. Our best strategy to support our Members by defending and protecting medical professional liability protections is based at the state level. 

Another new and important challenge to protecting, defending, and supporting our Members at both the national and state levels lies within the criminalization of medicine, in the form of criminal prosecution of medical negligence and new criminal regulations targeting physicians and other practitioners in the reproductive-health arena.

Despite these challenges, our duty to our Members has not wavered. We remain true to our mutuality and founding principles and will continue to put our Members first in every business decision and in all the products and services we provide. We will continue to serve as a trusted, reliable source of information for our Members and lawmakers at every level. We will continue to be a leading advocate and to support our Members by defending the practice of good medicine and protecting against the erosion of liability reform, now and in the future.