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Current Texas Law Regarding Medical Malpractice Claims Denies Many Plaintiffs Access to Meaningful Recovery

Rocio Murillo Oct. 30, 2015

If injured by a healthcare provider’s negligence, most patients assume that they are entitled to compensation for the full extent of their injuries. Many states such as Texas, however, have limited the amount a plaintiff may recover by enacting “capping” statutes, which set a limit on the amount of damages a healthcare provider may be on the hook for. In 2003, the Texas Legislature passed what is commonly known as HB 4 and Proposition 12, which placed such a damage cap on the amount recoverable under medical malpractice causes of action.

        Economic damages such as medical bills and lost earnings are not capped.[1] Non-economic damages, however, such as pain and suffering, emotional damages, and disability, have been capped. Codified at § 74.301 of the Civil Practice and Remedies Code, HB 4 and Proposition 12 limited noneconomic damages to a possible, though unlikely, aggregate total of $750,000.[2] This aggregate total “breaks down to $250,000 for all non-institutional defendants (i.e. doctors, nurses, dentists, etc.) plus $250,000 for each health care institution (i.e. hospitals, nursing homes, hospices, etc.) up to a total of $500,000 for all institutions.”[3]

One of the main reasons the Texas legislature imposed such a cap on damages was to lower the rates of medical malpractice liability insurance.[4] Insurance providers and medical professionals alike blamed unlimited non-economic damages as the reason for extremely high costs of insurance and health care in general.[5] This alleged crisis provided a rallying point for special interest groups and lobbyists who promoted HB 4 and Proposition 12 as the end to this vicious circle of high insurance and health care costs.[6] However, the most profound effect of HB 4 was not to lower healthcare costs, it was to severely limit Texas plaintiffs’ ability to recover meaningful damages in medical malpractice claims. Unfortunately, it has been proven through statistical evidence that capping statutes does not actually reduce medical malpractice insurance premiums.[7] Thus, the alleged purpose of the capping statute still goes unmet, while the rights of medical malpractice plaintiffs are severely burdened.

Caps on non-economic damages make a large amount of medical malpractice claims impossible to pursue. The reason these caps act to reduce plaintiffs’ ability to recover stems from plaintiff’s lawyers working on a contingency fee basis. Plaintiff’s lawyers use contingency fees because they allow plaintiffs meaningful access to rights and remedies, even though the plaintiffs may not have the funds to pay their lawyer’s hourly rate. Under this fee system, a lawyer is only paid if the plaintiff’s claim is successful—it is the lawyer who bears the risk, not the client.[8] The cost of retaining expert witnesses, investigating the case, filing motions, and taking depositions can make adequate preparation and litigation of such cases very expensive.

With the current damages caps, the risk for attorneys taking on medical malpractice cases has gone up exponentially as the margin for lawyers to make money has been significantly reduced. It simply is not feasible for most plaintiffs’ attorneys to take medical malpractice cases when they do not involve death or injury that results in serious, permanent disability or disfigurement. Therefore, as plaintiffs’ lawyers have sought ways to stay profitable, many have begun declining a large majority of medical malpractice cases. The result of this has been that claimants are being deprived of access to the rights and remedies the law provides, even though they have completely legitimate, valuable claims.

[1] However, if the medical bills were paid by Medicare, Medicaid, or insurance, then it is Medicare, Medicaid, or insurance will be entitled to receive reimbursement for the amounts that they paid.

[2] Civ. Prac. & Rem. Code § 74.301.

[3] Tommy Jacks & Drew White, An Oncoming Train: A Plaintiff’s View on House Bill 4 & Medical Malpractice, 24 The Advoc. (Texas) 21 (2003).

[4] Imrana Manzanares, Capping Statutes and Their Constitutionality, 37 The Advoc. (Texas) 103, 103 (2006).

[5] Id.

[6] Id.

[7] Id. at 105 (“This study found that caps on non-economic damages reduced punitive damage awards by 20-30% and disproportionately burdened the most severely injured plaintiffs; additionally, caps did not constrain the growth of insurance premiums.”).

[8] Stephen Daniels & Joanne Martin, Texas Plaintiffs’ Practice In The Age of Tort Reform: Survival of the Fittest—It’s Even More True Now, 51 N.Y.L. Sch. L. Rev. 285, 319 (2006-2007) (“As one lawyer simply put it, ‘I front the costs and if we lose, I eat the costs.’”).

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