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Congress Considers Cap to Malpractice Damages, Contingent Fees

By Casey C. Sullivan, Esq. on March 28, 2016 | Last updated on March 21, 2019

Is the medical malpractice world about to experience some dramatic change? Yes, if congressional Republicans get their way.

Congress is currently considering a bill that would cap damages for pain and suffering and reduce attorneys' contingent fees. Let's take a look.

An Idiot's Guide to H.R. 4771

The bill, H.R. 4771, is cleverly titled the "Help Efficient, Accessible, Low-cost, Timely Healthcare Act of 2016," or the HEALTH Act. (Alright, the title is clunky, but we appreciate the acronym.) Introduced by Congressman Trent Franks, an Arizona Republican, the law is essentially the same as a similar tort reform bill introduced in 2012, which went nowhere.

Here are the highlights. The HEALTH Act:

  • Limits damages for noneconomic harms to $250,000 or below.
  • Institutes a federal "fair share rule," limiting each party's share of damages to their percentage of liability.
  • Allows judges to restrict payment of contingent fees.
  • Sets limits on attorney contingent fees, from a maximum of 40 percent of the first $50,000 recovered, to 15 percent of any amount over $600,000.
  • Protects medical products that meet FDA standards from punitive damages.

But Will It Pass?

As one might expect, there are plenty of attorneys who are not pleased with the proposed law. The American Bar Association recently announced its opposition to the HEALTH Act. In a letter to Representative Bob Goodlatte, chairman of the Committee on the Judiciary, the ABA took particular issue with the act's damages limitations, proportionate liability, and contingent fees restrictions.

The bill's damages cap, the ABA argued, would impose a particularly heavy burden to the most vulnerable victims of medical malpractice:

Empirical research has shown that caps diminish access to the courts for low-wage earners, like the elderly, children, and women; if economic damages are minor and noneconomic damages are capped, attorneys are less likely to represent these potential plaintiffs.

Will the ABA's opposition be enough to stop the bill? It's too soon to tell. (The bill just went into committee mark up last week.) But it's worth keeping in mind that such bills, including the HEALTH Act's 2012 predecessor, tend to make headlines during election cycles, then fizzle out once the politicking is done.

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