Florida Passes Medical Malpractice Caps - DD 12/03

Defense Digest

Florida Passes Medical Malpractice Caps

On August 14, 2003, Florida Governor Jeb Bush signed legislation that would curtail jury awards in medical malpractice cases, as well as effectively eliminate lawsuits against health maintenance organizations (HMOs) arising from medical malpractice actions against panel physicians.

The newly enacted legislation ("The Act") limits a claimant's recovery for non-economic damages (i.e. pain and suffering, inconvenience, physical impairment, mental anguish, disfigurement, loss of capacity for enjoyment of life, and other nonfinancial losses) arising from a claim of personal injury or wrongful death associated with medical negligence against healthcare practitioners to $500,000.  However, a claimant may recover up to $1 million if the negligence resulted in a permanent vegetative state or death, or the trial court finds that the non-economic harm sustained by the claimant was particularly severe and the jury finds that the negligence of the medical professional was the proximate cause of a catastrophic injury to the claimant.  Section 766.118, Florida Statutes, defines "catastrophic injury" as a permanent impairment constituted by:

Spinal cord injury involving severe paralysis;
Amputation of an arm, hand, foot or leg;
Severe brain or closed head injury;
Second or third degree burns over 25 percent of the body;
Total loss of vision; or
Loss of reproductive organs

Recovery against nonpractitioners (i.e. hospitals, medical facilities, clinics, etc.) arising from a personal injury or wrongful death claim is limited to $750,000.  However, like those claims against practitioners, a claimant's non-economic recovery may be increased if the negligence resulted in a permanent vegetative state or death, or the trial court finds that the non-economic harm sustained by the claimant was particularly severe and the jury finds that the negligence of the medical professional was the proximate cause of a catastrophic injury to the claimant.

Additionally, the Act limits non-economic damages against practitioners rendering emergency services to $150,000 per claimant with all claimants in an action limited to $300,000.  Actions against non-practitioners involved in the negligent administration of emergency care and services are capped at $750,000 per claimant with recoveries by multiple claimants in a single action not to exceed $1.5 million.

In addition to capping non-economic damages, the Act effectively abolishes a claimant's ability to hold a HMO liable under a theory of vicarious liability.  Newly created Section 768.0981 states that a HMO is not liable for the medical negligence of a health care provider with whom the HMO had a contract, unless the HMO expressly directs or exercises actual control over the specified conduct that caused the injury.  In the past, plaintiffs would often assert that the provider was the actual agent of the HMO because the HMO either exercised control through a system of utilization management or the contract with the provider contained requirements that a physician seek authorization for payment prior to rendering services.  Alternatively, plaintiffs would argue that the physician was the apparent agent of the HMO based on representations made in the provider directory.

Moreover, prior to the enactment of the Act, Florida law was unsettled as to whether a HMO needed to be put on presuit notice in accordance with Chapter 766, et. seq.  However, the amendment to Section 766.202, Florida Statutes, conclusively demonstrates that the Legislature now requires a claimant to put a HMO on presuit notice, like all other medical providers in a medical negligence action.  Specifically, Section 766.202 defines a "health care provider" as a HMO certified under Part I of Chapter 641 (Chapter 641 regulates health maintenance organizations.)

The Act also extends protection to insurance carriers for bad faith lawsuits.  Insurance carriers are protected from bad faith lawsuits if they offer to settle the physicians’ policy limits within 210 days of the service of the lawsuit.  Additionally, this time period may be extended in certain situations.  Currently, under Section 624.155, Florida Statutes (Bad Faith Statute), there is a 60-day statutory cure period once a claimant has filed a Notice of Civil Remedy with the State. 

The Act became effective September 15, 2003, and applies to Notices of Intent filed thereafter.

This synopsis is not exhaustive of the recent statutory changes and is only meant to provide the reader with a broad understanding of how the Act will effect future medical malpractice litigation in the state of Florida.  Claims specialists who have specific questions regarding the effect of the Act on present or future cases may feel free to contact the authors. 

*Mark is the managing shareholder of the firm's Orlando, FL office and can be reached at (407) 420-4390 or mthompson@mdwcg.com.   Adam Herman, an associate, can be reached at (407) 420-4382 or aherman@mdwcg.com.