Unreasonable and Imperfect: Constitutionality of the Louisiana Medical Malpractice Act's Limit on Recovery

• Author: Allison B. Lewis
• Pages: 417-444

The author wishes to thank Professor John M. Church for his invaluable assistance and guidance during the drafting of this Comment. Also, many thanks to Tom and Carol Lewis, and Charlie Reeves for their support, patience, and countless edits.

Page 417

Mark Johnson was a robust and healthy 38-year-old mechanic when he sought corrective treatment for a foot abnormality.¹During his procedure, doctors accidentally cut a tendon and severed an artery in Johnson's leg. Doctors repaired the tendon, but did not realize that oxygen-supplying blood was no longer flowing into Johnson's foot. When the error was finally discovered, a vascular surgeon attempted to repair the artery but failed. Johnson watched as his foot blackened, the tissue dying from oxygen loss. Doctors finally informed him that his lower leg would have to be amputated. Despite using a prosthetic leg, Johnson was no longer able to work under cars, control a clutch, or even drive small automobiles.

A $460,000 check, the award amount remaining after legal fees and a statutorily imposed cap that limited his medical malpractice damages, did little to ease Johnson's worries. In consideration of his $50,000 salary, Johnson had asked for $1.4 million in damages. Frustrated, he finally sought treatment from a psychiatrist and began taking antidepressants. Johnson is a resident of California and is subject to the State's $250,000 statutory cap on noneconomic damages.²

Could the same scenario happen in Louisiana? With damages in excess of a statutory cap, could a seriously injured victim face an arbitrary limit? The State of Louisiana similarly limits a plaintiff's recovery in a medical malpractice action against a health care provider. Part I of this Comment sets out the history of Louisiana's limitation on liability and discusses the recent constitutional controversy over this statute. Part II argues that the general damages cap is unconstitutional under the Louisiana Constitution, utilizing analysis of the Equal Protection and Access to Courts Clauses. Finally, Part III compares several states' solutions to the constitutionality issue, discussing indicators for wages and inflation. Page 418

I Background And History Of The Medical Malpractice Act's Limitation On Liability

In the mid-1970s, the Louisiana legislature faced several difficult decisions concerning the liability of the State's health care providers. Across the nation state legislatures were concerned with excessive damage awards and rising medical malpractice insurance costs.³ Along with almost every other state, Louisiana passed a statute in response to "the medical malpractice crisis."⁴ The problem was actually two-fold: issues of availability and affordability.⁵

The crisis of availability was specifically linked to the exit of major medical malpractice insurance providers who experienced significant losses during the early 1970s.⁶ This insurance exit trend was a major concern for doctors; in a 1975 national survey, doctors in sixteen states reported "difficulty" in obtaining coverage that they considered a precondition to their individual practices.⁷

In addition to issues regarding availability, the Louisiana legislature was also concerned that the skyrocketing costs would price many health care providers out of the remaining market. Doctors and insurance companies reported that, depending on a doctor's individual area of practice, the price of some medical malpractice insurance premiums increased as much as 500%.⁸Several states, including Louisiana, adopted policies consistent with the theory that "[t]he most direct way to alleviate insurance cost pressures on medical practitioners is by statutes designed to limit the amount of damages recoverable in a medical malpractice action."⁹ Proponents of such statutes argued that jury awards were one of the major reasons for premium increases, considering that Page 419 juries were more likely to irrationally overcompensate malpractice victims with awards for noneconomic damages, such as pain and suffering.¹⁰

A The Louisiana Statute, Revised Statutes Section 40:1299.42

The Louisiana State Legislature passed Act No. 817 on July 14, 1975,¹¹ and the Governor signed the act on August 4.¹² The act, codified in Louisiana Revised Statutes section 40:1299.42,¹³amended the Revised Statutes by adding a new part concerning medical malpractice.¹⁴ Subsection B of the statute provides: "The total amount recoverable for all malpractice claims for injuries to or death of a patient, exclusive of future medical care and related benefits as provided in Revised Statutes section 1299.43, shall not exceed five hundred thousand dollars plus interest and cost."¹⁵

The details of Louisiana's medical malpractice statute, including the application of the liability cap, are best explained by examining the process by which a victim brings a potential claim. Initially, a potential plaintiff must submit the claim to a medical review panel.¹⁶ That claim must be brought against a qualified healthcare provider.¹⁷ First, the panel considers all evidence in the Page 420 case¹⁸ including all medical information and the affidavits and testimony of expert witnesses.¹⁹ The panel then issues its opinion on whether the defendant qualified health care provider acted or failed to act within the appropriate standard of care.²⁰ The potential plaintiff can then choose-depending on the favorable or unfavorable opinion of the panel-to take his issue to trial.

If the plaintiff takes his complaint to court and the court rules in his favor, the qualified health care provider is personally liable for damages up to $100,000.²¹ If the plaintiff's award is in excess of that amount, the remainder, up to $500,000, is paid from the Patient's Compensation Fund (PCF).²² The PCF is a custodial fund held by the state to pay medical malpractice claimants.²³ Qualified health care providers annually pay into the PCF in accordance with rates determined by the Louisiana Insurance Rating Commission.²⁴

The limitation on liability in section 40:1299.42 is an absolute cap on a victim's recovery such that all damages, other than future medical costs, cannot exceed $500,000. Future medical expenses are not subject to the cap.²⁵

The principal purpose of enacting the Medical Malpractice Act was to limit health care providers' liability and to provide compensation to medical malpractice victims.²⁶ Limitations on liability were generally believed to yield a decrease in medical malpractice frequency and severity, as well as a decrease in costs Page 421 to healthcare providers, to provide for health care insurance available at reasonable rates, and finally to ensure medical malpractice victims prompt adjudication and reasonable recovery.²⁷ In an editorial supporting the statute's passage, the Baton Rouge Morning Advocate cited to the burgeoning costs of malpractice insurance as a principal reason for the limitation on liability.²⁸ The legislation, according to the editorial, was comparable to measures in Indiana, California, Florida, and Alabama.²⁹ Most importantly, the article billed the limitation on recovery as "adequate" but conceded that "in future years this amount could be upped if inflation continues and the costs of living keeps going up."³⁰

B The Current Controversy and the Louisiana Third Circuit Court of Appeal

The Louisiana Third Circuit Court of Appeal recently considered two cases concerning the constitutionality of the cap.³¹Both cases are significant because they indicate a willingness on the part of courts to consider economic arguments in favor of finding the limitation on liability unconstitutional.³² The cases are also examples of circumstances likely to reoccur, indicating that not only has this been a prior issue for the courts, but also that it will continue to arise.

On October 28, 1994, William Arrington died at the Lake Area Medical Center in Lake Charles, Louisiana.³³ His doctor, Richard Samudia, was found to have committed malpractice in connection with Arrington's death.³⁴ The Medical Malpractice Act limited Dr. Samudia's personal liability to $100,000.³⁵ On August 15, 2000, Page 422 the plaintiffs also settled the related claim against the Louisiana Patient's Compensation Fund for $500,000.³⁶ Nevertheless, the plaintiffs appealed to the Louisiana Third Circuit Court of Appeal, seeking to have the limitation on liability in section 40:1299.42 declared unconstitutional.³⁷

At the same time, another challenge to the medical malpractice cap was moving through the court system. On June 22, 2001, a trial court awarded Charles and Sharon Taylor damages in excess of the statutory limit in a medical malpractice claim.³⁸ The Taylors appealed to the Louisiana Third Circuit Court of Appeal, seeking to have the limitations on their recovery imposed by the Medical Malpractice Act declared unconstitutional.³⁹...