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N.J. malpractice: some call it reform

The doctors and the trial lawyers in New Jersey have been having a big fight, and the docs got thrashed. That's the message of a purported medical-malpractice reform bill recently signed by Gov. Jim McGreevey and praised by the state trial lawyers' association, which has been numbered among McGreevey's chief backers. The bill adopts a favorite Litigation Lobby nostrum in dealing with escalating malpractice insurance rates, namely to throw subsidies at the problem: in particular, $78 million will be raised over three years to subsidize the highest-risk providers (such as surgeons, emergency room doctors, and ob/gyns). It will come at the expense of New Jersey employers (who will pay $3 per employee as a new surcharge) as well as doctors, chiropractors, dentists, optometrists and lawyers (who will pay $75 each). So for a while, at least, business as usual will be able to continue.

The bill also (according to the New York Times) adds more stringent requirements for reporting physician misconduct. Moreover, "it prevents insurers from raising the premiums of doctors whose medical malpractice lawsuits have been dismissed" -- apparently on the premise that the provision of legal defense in such cases is a free good that insurers can be ordered to provide gratis. More realistically, they will be expected to spread its cost among other, lower-risk insureds. Among the bill's many other provisions are several that may actually reduce the rate of litigation: giving judges more authority to reduce high awards, making it easier for peripheral doctors named in "shotgun" pleadings to get dropped from suits, tightening expert witness requirements, strengthening doctors' "Good Samaritan Law" protection for emergency care above and beyond their normal duties, and reducing from age 21 to age 13 the statute of limitations for suing over birth-related injuries. Which probably justifies doctors' much-publicized plunge into political activism: had they not kept the issue aflame on the front pages, the lawmakers might have ignored the litigation side of the problem entirely. (Jessica Bruder, "New Jersey Starts Fund for Malpractice Costs", New York Times, Jun. 8; Tanya Albert, "3 states pass tort reform; others still waiting", American Medical News (AMA), Jun. 14; Martin Grace, Jun. 14). For more on malpractice battles in the Garden State, see Overlawyered, Nov. 22 and links from there, Sept. 12, and Aug. 22, 2003.

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Rafael Mangual
Project Manager,
Legal Policy

Manhattan Institute


Published by the Manhattan Institute

The Manhattan Insitute's Center for Legal Policy.