29 Mar Legislative Update on Noneconomic Damages Caps

Iowa legislators continue to weigh the merits of imposing various limits or caps on lawsuits involving medical malpractice and commercial truck operators. Iowa’s 2022 legislative session is scheduled to continue through at least April 19, 2022. By now, many proposals that had been discussed and debated at the start of the new year have been passed or fallen to the wayside through Iowa’s funneling process of proposed legislation. However, the two acts that impose noneconomic damage caps remain up for consideration.

The proposal for medical malpractice caps is actually an expansion of a limit imposed by the Iowa legislature in 2017. That year, the state introduced a limit of $250,000.00 in noneconomic damages suffered by an injured person because of a mistake made by a healthcare provider. Iowa Code Sec. 147.139. Past pain and suffering, future pain and suffering and mental distress are more common examples of noneconomic damages. But there is a notable exception to the damage limitation: it need not be applied if the jury determines “there is a substantial or permanent loss or impairment of a bodily function, substantial disfigurement, or death, which [could] deprive the [injured person] just compensation.” In those situations, the jury could award whatever they collectively decided upon. However, the bills now being considered by both chambers of Iowa’s legislature, House File 2279 and Senate File 2275, would impose a $1 million cap to even those exceptional cases.

According to the New York Law School’s Center for Justice & Democracy, as of August 2020, twenty-nine states in the United States has some form of limitation on damages for medical malpractice claims. Wisconsin’s current limitation of $750,000.00 on noneconomic damages, found at Wisconsin Code Sec. 893.55, was passed by its legislature in 2005. In 2018, the Wisconsin Supreme Court upheld the limitation in Mayo v. Wis. Injured Patients & Families Compensation Fund, 914 N.W.2d 678 (Wis. 2018). Unlike Wisconsin’s Supreme Court, several other state’s highest courts, including Illinois, have found legislative attempts to cap damages in medical malpractice cases to be unconstitutional. See, e.g., Lebron v. Gottlieb Mem. Hosp., 930 N.E.2d 895 (Ill. 2010) (holding that Illinois’s cap on damages ran afoul of the separation of powers clause in the Illinois Constitution).

Iowa’s current consideration of caps may not have been prompted by any one particular lawsuit, but it does coincide with a March 2022 jury verdict against an Iowa City hospital that awarded $97.4 million to a family whose son suffered brain injuries during his birth. The verdict in S.K. v. Mercy Hospital and Obstetric and Gynecologic Associates of Iowa City and Coralville, P.C. (Johnson Co., LACV081421), likely the largest malpractice award in Iowa history, included $43,500,000.00 in noneconomic damages.

The same Iowa bills that seek the new cap on exceptional medical malpractice cases also turn their attention to another sector of the economy: commercial trucking. Prompted by concerns of alleged abusive lawsuits (“nuclear verdicts”) in other jurisdictions toward the trucking industry that have significantly increased the costs of liability insurance rates for companies, Republicans in the Iowa legislature have introduced a proposal to include a noneconomic damages cap of $1 million in lawsuits against the owner or operator of a commercial motor vehicle.

The proposal to limit damages in this context is certainly more controversial than caps in the medical malpractice realm. As of August 2020, only 8 states had noneconomic damage caps on general tort of personal injury cases, and a specific exemption for an industry other than medical appears to be an even more unique outlier, with only Texas having similar legislation specifically focused on jury verdicts in commercial trucking cases.

 

This article is a publication of MWH Law Group LLP and is intended to provide general information regarding legal issues and developments to our clients and other friends. It should not be construed as legal advice or a legal opinion on any specific facts or situations. For further information on your own situation, we encourage you to contact the author of the article or any other member of the firm.

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