S 218
112th CONGRESS
1st Session
S. 218
To improve patient access to health care services and provide
improved medical care by reducing the excessive burden the liability
system places on the health care delivery system.
IN THE SENATE OF THE UNITED STATES
January 27, 2011
Mr. ENSIGN introduced the following bill; which was read twice and
referred to the Committee on the Judiciary
A BILL
To improve patient access to health care services and provide
improved medical care by reducing the excessive burden the liability
system places on the health care delivery system.
Be it enacted by the Senate and House of Representatives of the
United States of America in Congress assembled,
SECTION 1. SHORT TITLE; TABLE OF CONTENTS.
(a) Short Title- This Act may be cited as the `Help Efficient, Accessible,
Low-cost, Timely Healthcare (HEALTH) Act of 2011'.
(b) Table of Contents- The table of contents of this Act is as follows:
Sec. 1. Short title; table of contents.
Sec. 2. Findings and purpose.
Sec. 3. Encouraging speedy resolution of claims.
Sec. 4. Compensating patient injury.
Sec. 5. Maximizing patient recovery.
Sec. 6. Additional HEALTH benefits.
Sec. 7. Punitive damages.
Sec. 8. Authorization of payment of future damages to claimants in
HEALTH care lawsuits.
Sec. 10. Effect on other laws.
Sec. 11. State flexibility and protection of States' rights.
Sec. 12. Applicability; effective date.
SEC. 2. FINDINGS AND PURPOSE.
(1) EFFECT ON HEALTH CARE ACCESS AND COSTS- Congress finds that our
current civil justice system is adversely affecting patient access
to health care services, better patient care, and cost-efficient health
care, in that the health care liability system is a costly and ineffective
mechanism for resolving claims of health care liability and compensating
injured patients, and is a deterrent to the sharing of information
among health care professionals which impedes efforts to improve patient
safety and quality of care.
(2) EFFECT ON INTERSTATE COMMERCE- Congress finds that the health
care and insurance industries are industries affecting interstate
commerce and the health care liability litigation systems existing
throughout the United States are activities that affect interstate
commerce by contributing to the high costs of health care and premiums
for health care liability insurance purchased by health care system
providers.
(3) EFFECT ON FEDERAL SPENDING- Congress finds that the health care
liability litigation systems existing throughout the United States
have a significant effect on the amount, distribution, and use of
Federal funds because of--
(A) the large number of individuals who receive health care benefits
under programs operated or financed by the Federal Government;
(B) the large number of individuals who benefit because of the exclusion
from Federal taxes of the amounts spent to provide them with health
insurance benefits; and
(C) the large number of health care providers who provide items
or services for which the Federal Government makes payments.
(b) Purpose- It is the purpose of this Act to implement reasonable,
comprehensive, and effective health care liability reforms designed
to--
(1) improve the availability of health care services in cases in which
health care liability actions have been shown to be a factor in the
decreased availability of services;
(2) reduce the incidence of `defensive medicine' and lower the cost
of health care liability insurance, all of which contribute to the
escalation of health care costs;
(3) ensure that persons with meritorious health care injury claims
receive fair and adequate compensation, including reasonable noneconomic
damages;
(4) improve the fairness and cost-effectiveness of our current health
care liability system to resolve disputes over, and provide compensation
for, health care liability by reducing uncertainty in the amount of
compensation provided to injured individuals; and
(5) provide an increased sharing of information in the health care
system which will reduce unintended injury and improve patient care.
SEC. 3. ENCOURAGING SPEEDY RESOLUTION OF CLAIMS.
The time for the commencement of a health care lawsuit shall be 3 years
after the date of manifestation of injury or 1 year after the claimant
discovers, or through the use of reasonable diligence should have discovered,
the injury, whichever occurs first. In no event shall the time for commencement
of a health care lawsuit exceed 3 years after the date of manifestation
of injury unless tolled for any of the following--
(2) intentional concealment; or
(3) the presence of a foreign body, which has no therapeutic or diagnostic
purpose or effect, in the person of the injured person.
Actions by a minor shall be commenced within 3 years from the date of
the alleged manifestation of injury except that actions by a minor under
the full age of 6 years shall be commenced within 3 years of manifestation
of injury or prior to the minor's 8th birthday, whichever provides a
longer period. Such time limitation shall be tolled for minors for any
period during which a parent or guardian and a health care provider
or health care organization have committed fraud or collusion in the
failure to bring an action on behalf of the injured minor.
SEC. 4. COMPENSATING PATIENT INJURY.
(a) Unlimited Amount of Damages for Actual Economic Losses in Health
Care Lawsuits- In any health care lawsuit, nothing in this Act shall
limit a claimant's recovery of the full amount of the available economic
damages, notwithstanding the limitation in subsection (b).
(b) Additional Noneconomic Damages- In any health care lawsuit, the
amount of noneconomic damages, if available, may be as much as $250,000,
regardless of the number of parties against whom the action is brought
or the number of separate claims or actions brought with respect to
the same injury.
(c) No Discount of Award for Noneconomic Damages- For purposes of applying
the limitation in subsection (b), future noneconomic damages shall not
be discounted to present value. The jury shall not be informed about
the maximum award for noneconomic damages. An award for noneconomic
damages in excess of $250,000 shall be reduced either before the entry
of judgment, or by amendment of the judgment after entry of judgment,
and such reduction shall be made before accounting for any other reduction
in damages required by law. If separate awards are rendered for past
and future noneconomic damages and the combined awards exceed $250,000,
the future noneconomic damages shall be reduced first.
(d) Fair Share Rule- In any health care lawsuit, each party shall be
liable for that party's several share of any damages only and not for
the share of any other person. Each party shall be liable only for the
amount of damages allocated to such party in direct proportion to such
party's percentage of responsibility. Whenever a judgment of liability
is rendered as to any party, a separate judgment shall be rendered against
each such party for the amount allocated to such party. For purposes
of this section, the trier of fact shall determine the proportion of
responsibility of each party for the claimant's harm.
SEC. 5. MAXIMIZING PATIENT RECOVERY.
(a) Court Supervision of Share of Damages Actually Paid to Claimants-
In any health care lawsuit, the court shall supervise the arrangements
for payment of damages to protect against conflicts of interest that
may have the effect of reducing the amount of damages awarded that are
actually paid to claimants. In particular, in any health care lawsuit
in which the attorney for a party claims a financial stake in the outcome
by virtue of a contingent fee, the court shall have the power to restrict
the payment of a claimant's damage recovery to such attorney, and to
redirect such damages to the claimant based upon the interests of justice
and principles of equity. In no event shall the total of all contingent
fees for representing all claimants in a health care lawsuit exceed
the following limits:
(1) Forty percent of the first $50,000 recovered by the claimant(s).
(2) Thirty-three and one-third percent of the next $50,000 recovered
by the claimant(s).
(3) Twenty-five percent of the next $500,000 recovered by the claimant(s).
(4) Fifteen percent of any amount by which the recovery by the claimant(s)
is in excess of $600,000.
(b) Applicability- The limitations in this section shall apply whether
the recovery is by judgment, settlement, mediation, arbitration, or
any other form of alternative dispute resolution. In a health care lawsuit
involving a minor or incompetent person, a court retains the authority
to authorize or approve a fee that is less than the maximum permitted
under this section. The requirement for court supervision in the first
two sentences of subsection (a) applies only in civil actions.
SEC. 6. ADDITIONAL HEALTH BENEFITS.
In any health care lawsuit involving injury or wrongful death, any party
may introduce evidence of collateral source benefits. If a party elects
to introduce such evidence, any opposing party may introduce evidence
of any amount paid or contributed or reasonably likely to be paid or
contributed in the future by or on behalf of the opposing party to secure
the right to such collateral source benefits. No provider of collateral
source benefits shall recover any amount against the claimant or receive
any lien or credit against the claimant's recovery or be equitably or
legally subrogated to the right of the claimant in a health care lawsuit
involving injury or wrongful death. This section shall apply to any
health care lawsuit that is settled as well as a health care lawsuit
that is resolved by a fact finder. This section shall not apply to section
1862(b) (42 U.S.C. 1395y(b)) or section 1902(a)(25) (42 U.S.C. 1396a(a)(25))
of the Social Security Act.
SEC. 7. PUNITIVE DAMAGES.
(a) In General- Punitive damages may, if otherwise permitted by applicable
State or Federal law, be awarded against any person in a health care
lawsuit only if it is proven by clear and convincing evidence that such
person acted with malicious intent to injure the claimant, or that such
person deliberately failed to avoid unnecessary injury that such person
knew the claimant was substantially certain to suffer. In any health
care lawsuit where no judgment for compensatory damages is rendered
against such person, no punitive damages may be awarded with respect
to the claim in such lawsuit. No demand for punitive damages shall be
included in a health care lawsuit as initially filed. A court may allow
a claimant to file an amended pleading for punitive damages only upon
a motion by the claimant and after a finding by the court, upon review
of supporting and opposing affidavits or after a hearing, after weighing
the evidence, that the claimant has established by a substantial probability
that the claimant will prevail on the claim for punitive damages. At
the request of any party in a health care lawsuit, the trier of fact
shall consider in a separate proceeding--
(1) whether punitive damages are to be awarded and the amount of such
award; and
(2) the amount of punitive damages following a determination of punitive
liability.
If a separate proceeding is requested, evidence relevant only to the
claim for punitive damages, as determined by applicable State law, shall
be inadmissible in any proceeding to determine whether compensatory
damages are to be awarded.
(b) Determining Amount of Punitive Damages-
(1) FACTORS CONSIDERED- In determining the amount of punitive damages,
if awarded, in a health care lawsuit, the trier of fact shall consider
only the following--
(A) the severity of the harm caused by the conduct of such party;
(B) the duration of the conduct or any concealment of it by such
party;
(C) the profitability of the conduct to such party;
(D) the number of products sold or medical procedures rendered for
compensation, as the case may be, by such party, of the kind causing
the harm complained of by the claimant;
(E) any criminal penalties imposed on such party, as a result of
the conduct complained of by the claimant; and
(F) the amount of any civil fines assessed against such party as
a result of the conduct complained of by the claimant.
(2) MAXIMUM AWARD- The amount of punitive damages, if awarded, in
a health care lawsuit may be as much as $250,000 or as much as two
times the amount of economic damages awarded, whichever is greater.
The jury shall not be informed of this limitation.
(c) No Punitive Damages for Products That Comply With FDA Standards-
(A) No punitive damages may be awarded against the manufacturer
or distributor of a medical product, or a supplier of any component
or raw material of such medical product, based on a claim that such
product caused the claimant's harm where--
(i)(I) such medical product was subject to premarket approval,
clearance, or licensure by the Food and Drug Administration with
respect to the safety of the formulation or performance of the
aspect of such medical product which caused the claimant's harm
or the adequacy of the packaging or labeling of such medical product;
and
(II) such medical product was so approved, cleared, or licensed;
or
(ii) such medical product is generally recognized among qualified
experts as safe and effective pursuant to conditions established
by the Food and Drug Administration and applicable Food and Drug
Administration regulations, including without limitation those
related to packaging and labeling, unless the Food and Drug Administration
has determined that such medical product was not manufactured
or distributed in substantial compliance with applicable Food
and Drug Administration statutes and regulations.
(B) RULE OF CONSTRUCTION- Subparagraph (A) may not be construed
as establishing the obligation of the Food and Drug Administration
to demonstrate affirmatively that a manufacturer, distributor, or
supplier referred to in such subparagraph meets any of the conditions
described in such subparagraph.
(2) LIABILITY OF HEALTH CARE PROVIDERS- A health care provider who
prescribes, or who dispenses pursuant to a prescription, a medical
product approved, licensed, or cleared by the Food and Drug Administration
shall not be named as a party to a product liability lawsuit involving
such product and shall not be liable to a claimant in a class action
lawsuit against the manufacturer, distributor, or seller of such product.
Nothing in this paragraph prevents a court from consolidating cases
involving health care providers and cases involving products liability
claims against the manufacturer, distributor, or product seller of
such medical product.
(3) PACKAGING- In a health care lawsuit for harm which is alleged
to relate to the adequacy of the packaging or labeling of a drug which
is required to have tamper-resistant packaging under regulations of
the Secretary of Health and Human Services (including labeling regulations
related to such packaging), the manufacturer or product seller of
the drug shall not be held liable for punitive damages unless such
packaging or labeling is found by the trier of fact by clear and convincing
evidence to be substantially out of compliance with such regulations.
(4) EXCEPTION- Paragraph (1) shall not apply in any health care lawsuit
in which--
(A) a person, before or after premarket approval, clearance, or
licensure of such medical product, knowingly misrepresented to or
withheld from the Food and Drug Administration information that
is required to be submitted under the Federal Food, Drug, and Cosmetic
Act (21 U.S.C. 301 et seq.) or section 351 of the Public Health
Service Act (42 U.S.C. 262) that is material and is causally related
to the harm which the claimant allegedly suffered; or
(B) a person made an illegal payment to an official of the Food
and Drug Administration for the purpose of either securing or maintaining
approval, clearance, or licensure of such medical product.
SEC. 8. AUTHORIZATION OF PAYMENT OF FUTURE DAMAGES TO CLAIMANTS IN
HEALTH CARE LAWSUITS.
(a) In General- In any health care lawsuit, if an award of future damages,
without reduction to present value, equaling or exceeding $50,000 is
made against a party with sufficient insurance or other assets to fund
a periodic payment of such a judgment, the court shall, at the request
of any party, enter a judgment ordering that the future damages be paid
by periodic payments, in accordance with the Uniform Periodic Payment
of Judgments Act promulgated by the National Conference of Commissioners
on Uniform State Laws.
(b) Applicability- This section applies to all actions which have not
been first set for trial or retrial before the effective date of this
Act.
SEC. 9. DEFINITIONS.
(1) ALTERNATIVE DISPUTE RESOLUTION SYSTEM; ADR- The term `alternative
dispute resolution system' or `ADR' means a system that provides for
the resolution of health care lawsuits in a manner other than through
a civil action brought in a State or Federal court.
(2) CLAIMANT- The term `claimant' means any person who brings a health
care lawsuit, including a person who asserts or claims a right to
legal or equitable contribution, indemnity, or subrogation, arising
out of a health care liability claim or action, and any person on
whose behalf such a claim is asserted or such an action is brought,
whether deceased, incompetent, or a minor.
(3) COLLATERAL SOURCE BENEFITS- The term `collateral source benefits'
means any amount paid or reasonably likely to be paid in the future
to or on behalf of the claimant, or any service, product, or other
benefit provided or reasonably likely to be provided in the future
to or on behalf of the claimant, as a result of the injury or wrongful
death, pursuant to--
(A) any State or Federal health, sickness, income-disability, accident,
or workers' compensation law;
(B) any health, sickness, income-disability, or accident insurance
that provides health benefits or income-disability coverage;
(C) any contract or agreement of any group, organization, partnership,
or corporation to provide, pay for, or reimburse the cost of medical,
hospital, dental, or income-disability benefits; and
(D) any other publicly or privately funded program.
(4) COMPENSATORY DAMAGES- The term `compensatory damages' means objectively
verifiable monetary losses incurred as a result of the provision of,
use of, or payment for (or failure to provide, use, or pay for) health
care services or medical products, such as past and future medical
expenses, loss of past and future earnings, cost of obtaining domestic
services, loss of employment, and loss of business or employment opportunities,
damages for physical and emotional pain, suffering, inconvenience,
physical impairment, mental anguish, disfigurement, loss of enjoyment
of life, loss of society and companionship, loss of consortium (other
than loss of domestic service), hedonic damages, injury to reputation,
and all other nonpecuniary losses of any kind or nature. The term
`compensatory damages' includes economic damages and noneconomic damages,
as such terms are defined in this section.
(5) CONTINGENT FEE- The term `contingent fee' includes all compensation
to any person or persons which is payable only if a recovery is effected
on behalf of one or more claimants.
(6) ECONOMIC DAMAGES- The term `economic damages' means objectively
verifiable monetary losses incurred as a result of the provision of,
use of, or payment for (or failure to provide, use, or pay for) health
care services or medical products, such as past and future medical
expenses, loss of past and future earnings, cost of obtaining domestic
services, loss of employment, and loss of business or employment opportunities.
(7) HEALTH CARE LAWSUIT- The term `health care lawsuit' means any
health care liability claim concerning the provision of health care
goods or services or any medical product affecting interstate commerce,
or any health care liability action concerning the provision of health
care goods or services or any medical product affecting interstate
commerce, brought in a State or Federal court or pursuant to an alternative
dispute resolution system, against a health care provider, a health
care organization, or the manufacturer, distributor, supplier, marketer,
promoter, or seller of a medical product, regardless of the theory
of liability on which the claim is based, or the number of claimants,
plaintiffs, defendants, or other parties, or the number of claims
or causes of action, in which the claimant alleges a health care liability
claim. Such term does not include a claim or action which is based
on criminal liability; which seeks civil fines or penalties paid to
Federal, State, or local government; or which is grounded in antitrust.
(8) HEALTH CARE LIABILITY ACTION- The term `health care liability
action' means a civil action brought in a State or Federal court or
pursuant to an alternative dispute resolution system, against a health
care provider, a health care organization, or the manufacturer, distributor,
supplier, marketer, promoter, or seller of a medical product, regardless
of the theory of liability on which the claim is based, or the number
of plaintiffs, defendants, or other parties, or the number of causes
of action, in which the claimant alleges a health care liability claim.
(9) HEALTH CARE LIABILITY CLAIM- The term `health care liability claim'
means a demand by any person, whether or not pursuant to ADR, against
a health care provider, health care organization, or the manufacturer,
distributor, supplier, marketer, promoter, or seller of a medical
product, including, but not limited to, third-party claims, cross-claims,
counter-claims, or contribution claims, which are based upon the provision
of, use of, or payment for (or the failure to provide, use, or pay
for) health care services or medical products, regardless of the theory
of liability on which the claim is based, or the number of plaintiffs,
defendants, or other parties, or the number of causes of action.
(10) HEALTH CARE ORGANIZATION- The term `health care organization'
means any person or entity which is obligated to provide or pay for
health benefits under any health plan, including any person or entity
acting under a contract or arrangement with a health care organization
to provide or administer any health benefit.
(11) HEALTH CARE PROVIDER- The term `health care provider' means any
person or entity required by State or Federal laws or regulations
to be licensed, registered, or certified to provide health care services,
and being either so licensed, registered, or certified, or exempted
from such requirement by other statute or regulation.
(12) HEALTH CARE GOODS OR SERVICES- The term `health care goods or
services' means any goods or services provided by a health care organization,
provider, or by any individual working under the supervision of a
health care provider, that relates to the diagnosis, prevention, or
treatment of any human disease or impairment, or the assessment or
care of the health of human beings.
(13) MALICIOUS INTENT TO INJURE- The term `malicious intent to injure'
means intentionally causing or attempting to cause physical injury
other than providing health care goods or services.
(14) MEDICAL PRODUCT- The term `medical product' means a drug, device,
or biological product intended for humans, and the terms `drug', `device',
and `biological product' have the meanings given such terms in sections
201(g)(1) and 201(h) of the Federal Food, Drug and Cosmetic Act (21
U.S.C. 321(g)(1) and (h)) and section 351(a) of the Public Health
Service Act (42 U.S.C. 262(a)), respectively, including any component
or raw material used therein, but excluding health care services.
(15) NONECONOMIC DAMAGES- The term `noneconomic damages' means damages
for physical and emotional pain, suffering, inconvenience, physical
impairment, mental anguish, disfigurement, loss of enjoyment of life,
loss of society and companionship, loss of consortium (other than
loss of domestic service), hedonic damages, injury to reputation,
and all other nonpecuniary losses of any kind or nature.
(16) PUNITIVE DAMAGES- The term `punitive damages' means damages awarded,
for the purpose of punishment or deterrence, and not solely for compensatory
purposes, against a health care provider, health care organization,
or a manufacturer, distributor, or supplier of a medical product.
Punitive damages are neither economic nor noneconomic damages.
(17) RECOVERY- The term `recovery' means the net sum recovered after
deducting any disbursements or costs incurred in connection with prosecution
or settlement of the claim, including all costs paid or advanced by
any person. Costs of health care incurred by the plaintiff and the
attorneys' office overhead costs or charges for legal services are
not deductible disbursements or costs for such purpose.
(18) STATE- The term `State' means each of the several States, the
District of Columbia, the Commonwealth of Puerto Rico, the Virgin
Islands, Guam, American Samoa, the Northern Mariana Islands, the Trust
Territory of the Pacific Islands, and any other territory or possession
of the United States, or any political subdivision thereof.
SEC. 10. EFFECT ON OTHER LAWS.
(1) To the extent that title XXI of the Public Health Service Act
establishes a Federal rule of law applicable to a civil action brought
for a vaccine-related injury or death--
(A) this Act does not affect the application of the rule of law
to such an action; and
(B) any rule of law prescribed by this Act in conflict with a rule
of law of such title XXI shall not apply to such action.
(2) If there is an aspect of a civil action brought for a vaccine-related
injury or death to which a Federal rule of law under title XXI of
the Public Health Service Act does not apply, then this Act or otherwise
applicable law (as determined under this Act) will apply to such aspect
of such action.
(b) Other Federal Law- Except as provided in this section, nothing in
this Act shall be deemed to affect any defense available to a defendant
in a health care lawsuit or action under any other provision of Federal
law.
SEC. 11. STATE FLEXIBILITY AND PROTECTION OF STATES' RIGHTS.
(a) Health Care Lawsuits- The provisions governing health care lawsuits
set forth in this Act preempt, subject to subsections (b) and (c), State
law to the extent that State law prevents the application of any provisions
of law established by or under this Act. The provisions governing health
care lawsuits set forth in this Act supersede chapter 171 of title 28,
United States Code, to the extent that such chapter--
(1) provides for a greater amount of damages or contingent fees, a
longer period in which a health care lawsuit may be commenced, or
a reduced applicability or scope of periodic payment of future damages,
than provided in this Act; or
(2) prohibits the introduction of evidence regarding collateral source
benefits, or mandates or permits subrogation or a lien on collateral
source benefits.
(b) Protection of States' Rights and Other Laws- (1) Any issue that
is not governed by any provision of law established by or under this
Act (including State standards of negligence) shall be governed by otherwise
applicable State or Federal law.
(2) This Act shall not preempt or supersede any State or Federal law
that imposes greater procedural or substantive protections for health
care providers and health care organizations from liability, loss, or
damages than those provided by this Act or create a cause of action.
(c) State Flexibility- No provision of this Act shall be construed to
preempt--
(1) any State law (whether effective before, on, or after the date
of the enactment of this Act) that specifies a particular monetary
amount of compensatory or punitive damages (or the total amount of
damages) that may be awarded in a health care lawsuit, regardless
of whether such monetary amount is greater or lesser than is provided
for under this Act, notwithstanding section 4(a); or
(2) any defense available to a party in a health care lawsuit under
any other provision of State or Federal law.
SEC. 12. APPLICABILITY; EFFECTIVE DATE.
This Act shall apply to any health care lawsuit brought in a Federal
or State court, or subject to an alternative dispute resolution system,
that is initiated on or after the date of the enactment of this Act,
except that any health care lawsuit arising from an injury occurring
prior to the date of the enactment of this Act shall be governed by
the applicable statute of limitations provisions in effect at the time
the injury occurred.
END
