MICRA: Protections Physicians and Their Patients Can't Afford To Lose
Information from CMA You Need to Know
Brief History
In 1975, the Governor called the Legislature into special session to solve the medical malpractice crisis that threatened to destroy the delivery of quality health care to Californians. During the crisis, professional liability insurance premiums increased as much as 400 percent and many professional liability insurers left California. Physicians were faced with astronomical insurance premiums, which forced them to choose between practicing without insurance, moving out of state, or passing costs onto patients. Many physicians in certain specialties could not even find insurance. Rising to the occasion, the Legislature created MICRA.
What Is MICRA?
The Medical Injury Compensation Reform Act of 1975 (MICRA) is a collection of statutes. The major statutes provide:
A $250,000 Cap on "Pain and Suffering" Damages
There is no cap on economic (or "actual") damages, which means that an injured patient is fully compensated for future and past medical costs, lost income and loss of future earnings.
Collateral Sources Judgment Reduction
If a plaintiff in a medical injury lawsuit receives money from another entity to compensate for the plaintiff's injuries (e.g., individual medical insurance), that money can be subtracted from a proportion of the plaintiff's award in a medical injury case. MICRA decreases the plaintiffs' attorneys' percentage of the award on a sliding scale basis so more of the award compensates the plaintiff.
Periodic Payment of Large Verdicts
Before MICRA, a large verdict had to be paid in a lump sum. Now, through annuities, plaintiffs can be paid on a regular basis for the rest of their lives.
MICRA WORKS
MICRA Moderates Professional Liability Premiums
Because of MICRA, California physicians pay comparatively low professional liability premiums. Without MICRA, individuals and groups that purchase professional liability insurance coverage can expect a significant increase in professional liability premiums. An increase in professional liability premiums will affect economic viability and the ability to provide quality patient care by adding overhead costs. Funds that now go towards preventive medicine, staffing, equipment maintenance, continuing education, and pro bono services will be diverted to malpractice premiums. Indigent, working poor and uninsured patients, who depend on nonprofit health organizations that cannot afford increases in insurance premiums, will be the hardest hit.
MICRA Moderates Claims Payment Amounts
If the MICRA damages cap is lifted or raised, claims payments will rise dramatically for self-insured hospitals. The hardest hit will be county and state institutions, which are nonprofit, government-funded organizations that have suffered significant funding decreases in recent years, making them particularly vulnerable to increases in overhead, like claims payment increases. Higher claims payouts will divert vital funds from care of the indigent and working poor, as well as staffing, salaries, and teaching programs.
MICRA Facilitates Medical Injury Lawsuit Settlements
MICRA takes the "lottery mentality" out of the court room and encourages settlement amounts supported by objective evidence, like lost past and future earnings, and past and future medical expenses. If the MICRA cap is increased or eliminated, more speculations on the value of the case will occur because of difficulties agreeing on the dollar value for pain and suffering. Without MICRA, trial is more likely, meaning physicians will spend more time in litigation and less time with patients. The "lottery mentality" fuels the litigation fire and everybody loses.
MICRA QUESTIONS AND ANSWERS
Is MICRA's Cap on "Pain and Suffering" Damages Fair?
YES. Most countries do not allow recovery of "pain and suffering" damages. In California medical injury cases, plaintiffs are awarded millions of dollars for their actual damages, which are not limited by MICRA. In other words, the plaintiff recovers for lost past and future income, medical expenses, and all other economic losses caused by their injury.
Does MICRA Protect Incompetent or Unethical Physicians?
NO. There are a variety of laws unaffected by MICRA that punish unacceptable physician activities with fines, imprisonment, and license revocation, not to mention punitive damages, which punish egregious behavior in medical injury actions.
Does MICRA Deny Court Access?
NO. The overall number of medical injury cases and verdict award amounts has steadily increased, and the number of medical injury claims filed per 100 physicians has barely varied over the last fifteen years.
PHYSICIAN AND MEDICAL STAFF ADVOCACY
Because the trial lawyers have significantly increased their campaign against MICRA within the last year, and CMA anticipates that it will only get worse, physician advocacy is crucial. CMA's Professional Liability Committee has therefore planned a statewide MICRA educational campaign utilizing a speakers' bureau comprised of CMA physicians. The objective of this campaign is to reach out to California physicians, particularly those who have never heard of MICRA, through an effective program that will provide them with the knowledge and motivation that they need to understand, discuss, and advocate effectively for MICRA preservation, while encouraging membership in organized medicine and contributions to PACs. Physician speakers, including a team from SBCMS, are conducting 15-minute MICRA presentations during hospital medical staff and medical group meetings.
What can you do? Go
to the CAPP/MICRA Page to find your legislator, retrieve more information
about MICRA, find sample resolutions and letters you can send to your state
representatives. If you are interested in being involved in the campaign, or
would like to have a MICRA presentation at your hospital medical staff or medical
group meeting, contact Mary-Lynn Pirner of CMA's Legal Division at (415) 882-3380
or SBCMS at (909) 825-6526.
Copyright © 1998 San Bernardino County Medical Society