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Letters to the 107th Congress

April 6, 2001

The Honorable Bill Frist
Chair, Subcommittee on Public Health,
    Committee on Health, Education, Labor, and Pensions
United States Senate
Washington, DC 20510

Dear Mr. Chair:

I am writing to you today on behalf of the American Bar Association (ABA), regarding the legislation you are developing on patients' rights that would amend the Employee Retirement Income Security Act of 1974 (ERISA) to permit patients to bring causes of action against their employer-sponsored health plans. I appreciate all of your efforts to develop legislation in this area. We understand that the bill you are developing would partially remove the ERISA shield and permit a patient enrolled in an employer-sponsored health plan to bring a cause of action in federal court for "medically reviewable" decisions. We understand that you are also considering capping pain and suffering awards at $500,000.

We encourage you to consider developing legislation to allow patients to bring causes of action in state courts over "medically reviewable" decisions rather than in the federal courts. We also urge you not to include provisions to cap "pain and suffering" awards in the legislation you are developing.

Disputes involving medical decision-making by health plans should be resolved in state court under state laws. State courts have been handling health care liability claims for over 200 years. It makes no sense to add an additional burden to the federal courts when the state courts are perfectly capable of handling these cases. Allowing these disputes to be brought in state courts will promote judicial economy - and avoid wasteful duplicate proceedings in federal and state court - when there are multiple defendants.

Because malpractice suits against doctors and hospitals will continue to be brought in state court, related actions against employer-sponsored health plans should be resolved in the same forum. Otherwise, there would always be two, not one, lawsuits involving the same facts and injury. The health plan would be a defendant under the federal cause of action. The hospitals, doctors or other health providers would be defendants under the state cause of action. Requiring patients to pursue two separate lawsuits regarding the same dispute is a waste of all parties' time and resources. Also, the Supreme Court, in the recent decision of Pegram et al. v. Herdrich, reaffirmed that the state courts are the appropriate courts to handle medical liability matters.

The ABA believes that proposals to cap liability for non-economic losses are ill-advised. Such proposals that arbitrarily limit non-economic damages would deprive individuals of compensation for the consequences of medical-malpractice injuries. No one states that such injuries are not real or severe. Such proposals would mean seriously injured persons who are in most need of compensation would receive less than full compensation. This outcome would be grossly unjust. Such proposals would result in seriously injured persons who are the least able to afford it receiving less than full compensation, while less seriously injured persons would be fully compensated.

In the 106th Congress, the ABA prepared the enclosed letter that was sent to the conferees on the then-pending patients' bill of rights legislation, H.R. 2990. I enclose it for your reference as its sets out ABA views on other aspects of the legislation that I have not discussed in this letter.

Thank you for considering our views. Please let me know if you have any questions or if we can provide you with additional information. You may also wish to contact the Senior Legislative Counsel who is working on this issue for the ABA, Lillian Gaskin. For questions on the internal/external review provisions of the legislation you are developing, please contact the Legislative Counsel who is working on this aspect of the legislation for the ABA, Larson Frisby.


Miles J. Zaremski
Chair, ABA Special Committee on
Medical Professional Liability


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