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Florida Supreme Court Strikes Cap for Noneconomic Damages in Medical Malpractice Wrongful Death Actions

October 30, 2014

Court strikes med mal caps for noneconomic damages

By Gary Blankenship
Senior Editor

A 2003 law setting caps on noneconomic damages in medical malpractice wrongful death cases has been struck down by the Florida Supreme Court as violating equal protection guarantees in the Florida Constitution.

The case produced three opinions: a plurality opinion written by Justice Fred Lewis and concurred with by Justice Jorge Labarga; a concurring opinion by Justice Barbara Pariente, joined by Justices Peggy Quince and James Perry; and a dissent by Chief Justice Ricky Polston, joined by Justice Charles Canady.

The March 13 ruling generated criticism from medical and business groups, but praises from plaintiff attorneys.

“We are very disappointed in the Supreme Court’s decision,” said Bill Herrle, state director of the National Federation of Independent Business Florida. “Florida’s tort reform law was a rational response to the crisis in medical malpractice insurance and it helped serve the interests of both Floridians and Florida’s small businesses.”

NFIB had filed an amicus brief in the case.

The Florida Medical Association, which supported the legislation when it was before the Legislature, said the decision will lead to higher malpractice insurance rates and fewer doctors in Florida.

“The Florida Legislature enacted these caps in 2003 to counter the out-of-control litigation that was driving physicians out of the state and discouraging new physicians to locate in Florida. The caps have helped begin to stabilize the medical liability climate in Florida. Insurance premiums, while still high compared to other states, have started to level off since the caps were put into place,” FMA President Alan Harmon said.

“Thanks to the Florida Supreme Court, we can be sure that patients will face an intensified access to care crisis. The likely outcome will be that trial lawyers will refocus their sights on physicians, meritless lawsuits will clog our courts, and physicians will move to states with a more favorable litigation climate, like Texas. Patients should expect longer wait times and reduced access to specialists like OB-GYNs, neurosurgeons, and general surgeons. This is the last thing Florida patients and physicians need.”

But Paul Anderson, president of the Florida Justice Association, hailed the decision: “We applaud the Florida Supreme Court on its ruling this morning and are pleased victims and their families will have the opportunity to be fully compensated for their losses. The cap on noneconomic damages unfairly punished victims whose lives were permanently altered by no fault of their own.”

The underlying case involved an Air Force dependent who died from blood loss after delivering a baby and whose family sued the federal government under the Federal Tort Claims Act. The FTCA provides that awards will be controlled by the laws of the state where the underlying incident occurred. A judge awarded almost $1 million in economic damages and $2 million in noneconomic damages, divided between the woman’s son and parents.

The latter award was reduced to $1 million under F.S. §766.118(2). That limits noneconomic damages to $500,000 for a single person and to $1 million for any wrongful death medical malpractice action incident involving more than one claimant.

The verdict was appealed to the U.S. 11th Circuit Court of Appeals, which held that the state law did not violate the equal protection provisions of the U.S. Constitution. But that court certified four questions to the Florida Supreme Court:

* Does the state law violate the equal protection provisions of the Florida Constitution?

* Does the noneconomic damages cap violate the right to access to the courts guaranteed in the Florida Constitution?

* Does the noneconomic damages cap violate the right to a trial by jury guaranteed by the Florida Constitution?

* Does the noneconomic damages cap violate the separation of powers spelled out in the Florida Constitution?

Lewis’ opinion answered the first question in the affirmative and said it was not necessary to address the other questions. Pariente’s opinion agreed with that but not all of the arguments Lewis used. Polston’s dissent argued the Legislature acted within its authority in finding the damages cap was necessary and that all four questions should be answered in the negative.

Lewis wrote that in order to meet the requirements of Fla. Const. art. I, §2, which provides, “All natural persons, female and male alike, are equal before the law,” the damages cap must meet a rational basis test. “To satisfy the rational basis test, a statute must bear a rational and reasonable relationship to a legitimate state objective, and it cannot be arbitrary or capriciously imposed. Dep’t. of Corr. v. Fla. Nurses Ass’n., 508 So. 2d 317, 319 (Fla. 1987),” he wrote.

The law fails that test because it arbitrarily reduces awards when one medical malpractice incident gives rise to several claimants who face an “unfair and illogical” burden to getting full compensation, Lewis wrote. He added: “Further, the statutory cap on wrongful death noneconomic damages does not bear a rational relationship to the stated purpose that the cap is purported to address, the alleged medical malpractice insurance crisis in Florida.”

Although the concurring and dissenting opinions said it was neither right nor necessary, Lewis said it was proper for the court to examine the factors on which the Legislature based the need for capping noneconomic damages. He noted a special gubernatorial task force studied the issue and was the basis for much of the Legislature’s findings. But that report was not certain the cap would affect malpractice insurance rates, only saying it may help.

Other evidence provided to the Legislature indicated the caps would have little if any effect and that it was cyclical insurance industry issues, not malpractice claims, that were driving up rates. There was no requirement in the bill that any savings from the caps be passed on to doctors, Lewis noted, and the claim that high rates were driving doctors out of Florida was disputed by statistics showing that the actual number of doctors was rising faster than overall population growth.

Even if the cap was justified in 2003, Lewis wrote that since then malpractice claims, both in number and amounts paid out, have dramatically declined while malpractice insurance company net income is up more than 4,300 percent.

“Thus, even if there had been a medical malpractice crisis in Florida at the turn of the century, the current data reflects that it has subsided,” Lewis wrote. “. . . At the present time, the cap on noneconomic damages serves no purpose other than to arbitrarily punish the most grievously injured or their surviving family members. Moreover, it has never been demonstrated that there was a proper predicate for imposing the burden of supporting the Florida legislative scheme upon the shoulders of the persons and families who have been most severely injured and died as a result of medical negligence. Health care policy that relies upon discrimination against Florida families is not rational or reasonable when it attempts to utilize aggregate caps to create unreasonable classifications.”

While the statute placed caps on both wrongful death and nonfatal malpractice claims, he noted the opinion only addresses wrongful deaths.

Lewis declined to answer the last three certified questions, noting that it would require the court to issue an advisory opinion because the state did not by common law recognize wrongful death actions and the Legislature did not create the right to noneconomic damages in wrongful death cases until 1972.

Pariente, in her concurring opinion, said she agreed with the plurality that the damages cap violated the equal protection clause of the state constitution, but disagreed with the application of the rational basis test to the legislative findings justifying the law.

“I emphasize, however, that although I do not fully join in the plurality’s application of the rational basis test, I agree with the ultimate conclusion that the arbitrary reduction of survivors’ noneconomic damages in wrongful death cases based on the number of survivors lacks a rational relationship to the goal of reducing medical malpractice premiums,” Pariente wrote.

She argued that cases cited by Lewis to justify reviewing the Legislature’s rationale for enacting the law had different fact patterns and that the court is deferential in most cases to legislative findings.

“I respectfully conclude that there is simply no precedent for this court to engage in its own independent evaluation and reweighing of the facts and legislative policy findings, as done by the plurality, when conducting a rational basis analysis,” Pariente wrote.

In his dissent, Polston contended that Lewis and Pariente misapplied dicta from an earlier case in reaching their conclusion, and agreed with Pariente that Lewis’ review of legislative reasoning went too far.

“[A]s Justice Pariente’s concurring in result opinion recognizes, this court is not supposed to conduct an independent review of available data,” Polston wrote. “. . . Rather if we can conceive of a possible factual predicate that provides a rational basis in furtherance of a legitimate state interest, the statute does not violate the equal protection provision of the Florida Constitution.

“Here, applying the proper rational basis test, it is clear that the cap on noneconomic damages passes muster because it is rationally related to the legitimate state interest of decreasing medical malpractice insurance rates and increasing the affordability and availability of health care in Florida.”

He noted that several other state and federal courts had reached that conclusion.

Polston cited the Legislature’s finding of a crisis in medical malpractice insurance in rejecting the contention the law denied access to the courts. He argued because the right to recover noneconomic damages in wrongful death cases was not created by the Legislature until 1972, and, thus, was not included in earlier constitutions, the law does not affect the right to a trial by jury. He also rejected the separations of powers claim saying the statutory cap affects substantive rights of the parties and “does not violate the separation of power clause of the Florida Constitution.”

The court acted in Estate of Michelle Evette McCall, et al., v. United States of America, Case No. SC11-1148.

You can read the complete article here from the Florida Bar here.