MICRA essentially sets up a special set of rules for doctors being
sued for their negligence. These rules include the following:
a.
There is an absolute limit in a MICRA case for pain and suffering
or mental anguish damages of $250,000.00. In 1975, this may have
seemed like a lot more money, but the powerful doctors' and insurance
lobbyists have prevented the legislature from raising this amount
to keep up with inflation. Because of inflation, $250,000.00 today
has about the same buying power as $85,000.00 in 1975 dollars.
If anyone had proposed making a ceiling of only $85,000.00 for
pain and suffering damages when MICRA was being considered by
the legislature, the bill never would have passed.
In
1975, the minimum wage was less than half what it is today. Luxury
homes in some of the finest neighborhoods in Southern California
sold for $125,000.00, or even less. $40.00 would buy dinner for
two, with drinks and desert, at the finest restaurants in Los
Angeles. Most new cars, even luxury sedans, sold for less than
$10,000.00.
In
1975, a select few sports superstars, such as Jim "Catfish"
Hunter, Nolan Ryan and Reggie Jackson, were making big headlines
for negotiating sports contracts which paid them $1 million dollars
per year. At the time, these were the biggest names and the most
valuable players in their sport. Today, journeyman infielders
who've never made an all-star team negotiate for $1 million dollar
per year contracts. Superstar athletes today routinely ask for,
and get, between $10 million and $25 million per year.
In
the mid-1970's, the top corporate executives were also paid in
the vicinity of $1 million per year. The recent Enron debacle,
along with disclosures of compensation of executives from other
large corporations, show corporate executives today being paid
upwards of $50 million per year, even at companies that are losing
money. Executives like Michael Eisner of Disney or Larry Ellison
of Oracle would quit their jobs and write books if forced to work
for compensation levels set back in the mid-1970's.
More
recently, legislatures have awakened to the patent unfairness
of "caps" which do not move along with inflation. The
hotly-debated federal bill to reform "soft money" political
contributions is tied into inflation, so that candidates 25 years
from now will be able to finance their campaigns according to
current costs, rather than some cost limitations 25 years old.
However, for persons injured in medical malpractice injuries in
California, the caps imposed in 1975 are still the law. California
law states that citizens are supposed to receive full compensation
for injuries. Ask yourself: if you lost the closest person in
your entire life due to a doctor's rank negligence, would you
want more than $250,000.00 total? If you today had to bargain
for a price that you would be paid in exchange for undergoing
an entire life of painful suffering, such as with a crippling
injury or severe burns, would you settle for only $250,000.00?
In cases in which the MICRA cap does not apply, such as defective
product cases or traffic accident cases, severe, lifelong and
painful injuries bring more just amounts, reflecting the changing
economic times and inflation. MICRA effectively prevents California
citizens from receiving full compensation for their injuries,
where such injuries have been caused by doctors or hospitals.
b.
Unlike all other personal injury laws in California, MICRA lets
doctors introduce evidence of your insurance benefits in their
own defense. Before MICRA, California had what is known as the
"collateral source rule," which essentially stated that
a person should not be penalized in his or her personal injury
action for maintaining health or casualty insurance at his or
her own expense. So, in non-MICRA cases, if a person has received
insurance benefits to cover losses or injuries suffered, the jury
does not learn of this and the injured person can claim damages
based upon the medical bills incurred. However, MICRA changes
this for doctors, who get to introduce evidence of any medical
insurance benefits the injured patient has received to treat the
injuries caused by the inattentive doctors. In practical terms,
victims of medical negligence in California are essentially penalized
for maintaining their own health insurance, and doctors do not
have to pay the medical bills caused by their own negligence.
c.
MICRA caps attorney's fees substantially below the applicable
attorney's fees in other personal injury cases. Under MICRA, the
attorneys can receive a maximum of 40% of the first $50,000.00
recovered, 33-1/3% of the next $50,000.00, 25% of the next $500,000.00
and 17-1/2% of anything recovered beyond $600,000.00. Also under
MICRA, court costs and expert witness costs must be deducted from
the gross total recovery, rather than paid by the client.
The
prevailing market percentages for personal injury cases are around
one-third to 40% contingency fees to the attorney, with the client
paying for costs advanced.
So,
under MICRA, the attorney gets less and you get more. Good idea,
right? Well, let's think about this for just a moment to see what
the real impact of MICRA has been upon the availability of lawyers
to represent clients in medical malpractice actions.
Under
MICRA, economic damages (for instance, future medical care or
lost wages) are not capped. So, if there is a case of, say, a
severe birth injury which will result in expensive medical care
for the rest of the baby's life, there's no question that such
a case will generate enough money to interest and motivate just
about any medical malpractice attorney. Similarly, a successful
husband and father, struck down in his prime, will leave a wife
and children with an entire lifetime of living expenses that the
deceased father would have paid for. These are recoverable in
the ensuing medical malpractice action, and again, most attorneys
would be motivated to take such a case and work hard on it.
However,
these cases are relatively rare. Let's take, instead, a more typical
case: a single woman, in her 20's, formerly athletic and active,
left partially crippled in one of her legs because of doctor's
neglect and inattention during "routine" surgery on
the woman's knee. The woman must spend the rest of her days using
a walker or a cane to get around. The woman can still work, so
there's not too much lost wages. There might be some medical and
rehabilitation expenses to stabilize her condition after the botched
surgery, but she cannot recover for these costs because she maintained
her own medical insurance. However, no one reading this article
needs to have it explained that that woman has a serious lifelong
injury which will most likely affect all of the activities she
used to love, as well as all future efforts at romantic relationships,
at having children, at feeling good about herself at all. Because
she does not have a lot of economic damages, however, her case
value is probably not much more than the $250,000.00 cap on mental
anguish damages.
To
bring this case to trial, a good lawyer would have to invest at
least $25,000.00, and perhaps as much as $50,000.00, of his or
her own money, on expert witnesses (medical expert witnesses are
essentially required by law in all medical malpractice cases),
on deposition transcript fees, on filing fees, on subpoena fees
and the like. Most of this investment will be on expert witnesses,
and these costs are not always recoverable at the end. (By the
way, more complicated medical malpractice cases routinely require
the plaintiff's attorney to invest well over $100,000.00 of his
or her own money.)
Let's
say that the jury returns a verdict of $2 million dollars, after
the attorney has worked on the case for an entire year and spent
two weeks full-time in trial on the case. By law, the judge has
to reduce the jury's verdict to $250,000.00. (Normally, jurors
in medical malpractice cases are not informed about the $250,000.00
cap on mental anguish, pain and suffering damages.) The costs
come off of the top, so the MICRA attorney's fee percentages are
calculated against $225,000.00. 40% of the first $50,000.00 is
$20,000.00. One-third of the next $50,000.00 is $17,667.00. 25%
of the remaining $125,000.00 is $32,500.00. The attorney's net
recovery for his work on this case, which can easily last up to
a year or more, is about $70,000.00 or less.
That's
plenty of money, you say? Well, try running a law office, or any
business, with a handful of employees for a year on that amount
of money. The employer has to pay salaries, other overhead, insurance
benefits, worker's compensation, payroll taxes, etc. It cannot
be done on $70,000.00. Granted, the busy plaintiff's lawyer likely
has other cases in his office, but he will lose some of them and
have extremely disappointing recoveries ($5,000.00 or less) on
others. A recovery of $70,000.00 for a case which the lawyer has
personally financed, and which has remained on his books for a
year or more, and which has consumed probably 300 hours or more
of his or her professional time, simply is not that profitable
of a case. Depending on the lawyer's practice and on where his
or her offices are located (overhead is much greater in metropolitan
San Francisco or Los Angeles than in Bakersfield or Chico, for
instance), that $70,000.00 may not represent any profit at all.
Believe
it or not, in today's economy, most lawyers will pass on a $70,000.00
case because the economics of it make it unprofitable. There is
even the possibility that the lawyer will end up losing money
on the case, even after a successful verdict. Having made less
money, the plaintiff's lawyer in this case is reluctant to sign
up any similar case which walks into his office in the future,
because he continues to take the entire risk of losing his entire
personal investment in the case against the possibility of a very
limited recovery. After all, if he has made $70,000.00 on this
case, where will the $50,000.00 investment for the next case come
from?
So,
most talented lawyers, particularly those in larger metropolitan
areas with higher overhead demands, will pass on this case. The
woman who has suffered a disabling lifelong injury is left without
access to the best possible representation. This is not because
of the strength of her case; it is because of the economic squeeze
on the plaintiff's attorney created by MICRA.
More
and more consumers and citizens are finding it hard, if not impossible,
to find representation in medical malpractice cases because of
these economics. The woman described above (an actual case) is
but one example. The same unjust economics apply to the death
of a minor child or an adult past the age of 50; to malpractice
victims who may become crippled, and thus lose all quality of
life, yet retain the ability to hold down a job; to many other
classifications of serious injuries where the main component is
the prospect of lifelong pain, suffering, anguish and diminished
life quality.
I
recall one case in particular, where a psychiatric hospital essentially
engaged in human experimentation upon a college-age boy, locking
him up and forcibly drugging him without his consent and without
his parents' consent. The boy died from complications of the drugs
which had been forced upon him before his 20th birthday. The parents
brought a malpractice action, and a jury which heard all of the
evidence from both sides awarded them about $8 million dollars
for the loss of their only child. The judge was forced to reduce
the award, because of MICRA, to $250,000.00. After attorney's
fees, the parents were left with about $170,000.00 for the loss
of their only child. The psychiatric hospital essentially had
license to murder the boy, because its lawyers knew that it faced
a maximum exposure of $250,000.00 if the boy died.
And
don't think for a second that the insurance companies are unaware
of these mathematics. They use them to intimidate lawyers and
injured victims from pursuing medical malpractice cases. Malpractice
defendants almost never offer the full $250,000.00 to settle the
case, but instead make the plaintiff try the case to get the full
result. This requires a lot more investment by the plaintiff's
attorney.
The
time is not too far in the future when the only persons who will
have access to the courts with medical malpractice cases will
be those with the most expensive injuries. All others will effectively
be debarred from the courts.
This article points up only a few of the unjust aspects of MICRA.
There are many others, but explaining them all would require a
much longer article.
