Medical Malpractice Reform Act of 1994

Summary: Medical Malpractice Reform Act of 1994 - Limits to $250,000 the total amount of noneconomic damages that may be awarded to a claimant and members of the claimant's family for losses resulting from the injury which is the subject of a medical malpractice liability claim or action (claim), regardless of the number of parties against whom the claim is brought or the number of actions brought. 
Provides for a reduction of the total amount of damages received by an individual under such claim by any other payment made to compensate for the injury. 
Specifies that, in any such claim in which future economic damages exceed $100,000, a defendant shall be permitted to make payments periodically, rather than in a single, lump-sum payment, based on when the damages are found likely to occur.  Permits a court to waive such provision if the court determines that it is not in the plaintiff's best interests to receive payments on a periodic basis. 
Prohibits an attorney from charging or collecting a contingency fee for services rendered in connection with such a claim in excess of:  (1) 25 percent of the first $150,000 (or portion thereof) recovered, plus; (2) ten percent of any amount in excess of $150,000 recovered. 
Makes this Act applicable to any such claim brought in State or Federal court, except with respect to a claim for damages arising from a vaccine-related injury or death to the extent that title XXI of the Public Health Service Act applies. 
Sets forth provisions regarding:  (1) preemption; and (2) effect on sovereign immunity and choice of law or venue.

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Medical Malpractice Reform Act of 
1994''.

SEC. 2. CALCULATION AND PAYMENT OF DAMAGES IN MEDICAL MALPRACTICE 
              CLAIMS AND ACTIONS.

    (a) Limitation on Noneconomic Damages.--The total amount of 
noneconomic damages that may be awarded to a claimant and the members 
of the claimant's family for losses resulting from the injury which is 
the subject of a medical malpractice liability claim or action may not 
exceed $250,000, regardless of the number of parties against whom the 
claim or action is brought or the number of actions brought with 
respect to the injury.
    (b) Mandatory Offsets for Damages Paid by a Collateral Source.--
            (1) In general.--With respect to a medical malpractice 
        liability claim or action, the total amount of damages received 
        by an individual under such claim or action shall be reduced, 
        in accordance with paragraph (2), by any other payment that has 
        been, or will be, made to an individual to compensate such 
        individual for the injury that was the subject of such claim or 
        action.
            (2) Amount of reduction.--The amount by which an award of 
        damages to an individual for an injury shall be reduced under 
        paragraph (1) shall be--
                    (A) the total amount of any payments (other than 
                such award) that have been made or that will be made to 
                such individual to pay costs of or compensate such 
                individual for the injury that was the subject of the 
                claim or action; minus
                    (B) the amount paid by such individual (or by the 
                spouse, parent, or legal guardian of such individual) 
                to secure the payments described in subparagraph (A).
    (c) Periodic Payments for Future Losses.--
            (1) General rule.--In any medical malpractice liability 
        claim or action in which future economic damages exceed 
        $100,000, a defendant may not be required to pay such damages 
        in a single, lump-sum payment, but shall be permitted to make 
        such payments periodically based on when the damages are found 
        likely to occur, as such payments are determined by the court.
            (2) Waiver.--A court may waive the application of paragraph 
        (1) with respect to a defendant if the court determines that it 
        is not in the best interests of the plaintiff to receive 
        payments for damages on such a periodic basis.

SEC. 3. LIMITATION ON ATTORNEYS' CONTINGENCY FEES AND OTHER COSTS UNDER 
              MEDICAL MALPRACTICE CLAIMS.

    (a) In General.--An attorney who represents, on a contingency fee 
basis, a claimant in a medical malpractice liability claim may not 
charge, demand, receive, or collect for services rendered in connection 
with such claim in excess of the following amount recovered by judgment 
or settlement under such claim:
            (1) 25 percent of the first $150,000 (or portion thereof) 
        recovered, plus
            (2) 10 percent of any amount in excess of $150,000 
        recovered.
    (b) Calculation of Periodic Payments.--In the event that a judgment 
or settlement includes periodic or future payments of damages, the 
amount recovered for purposes of computing the limitation on the 
contingency fee under subsection (a) shall be based on the cost of the 
annuity or trust established to make the payments. In any case in which 
an annuity or trust is not established to make such payments, such 
amount shall be based on the present value of the payments.

SEC. 4. APPLICABILITY; EFFECT ON STATE LAW.

    (a) Applicability.--This Act shall apply with respect to any 
medical malpractice liability claim and to any medical malpractice 
liability action brought in any State or Federal court, except that 
this subtitle shall not apply to a claim or action for damages arising 
from a vaccine-related injury or death to the extent that title XXI of 
the Public Health Service Act applies to the claim or action.
    (b) Preemption.--The provisions of this Act shall preempt any State 
law to the extent such law is inconsistent with such provisions, except 
that such provisions shall not preempt any State law that places 
greater limitations on the amount of damages that may be awarded or the 
amount of attorneys' fees that may be collected with respect to medical 
malpractice liability claims.
    (c) Effect on Sovereign Immunity and Choice of Law or Venue.--
Nothing in subsection (b) shall be construed to--
            (1) waive or affect any defense of sovereign immunity 
        asserted by any State under any provision of law;
            (2) waive or affect any defense of sovereign immunity 
        asserted by the United States;
            (3) affect the applicability of any provision of the 
        Foreign Sovereign Immunities Act of 1976;
            (4) preempt State choice-of-law rules with respect to 
        claims brought by a foreign nation or a citizen of a foreign 
        nation; or
            (5) affect the right of any court to transfer venue or to 
        apply the law of a foreign nation or to dismiss a claim of a 
        foreign nation or of a citizen of a foreign nation on the 
        ground of inconvenient forum.
    (d) Federal Court Jurisdiction Not Established on Federal Question 
Grounds.--Nothing in this Act shall be construed to establish any 
jurisdiction in the district courts of the United States over medical 
malpractice liability actions on the basis of section 1331 or 1337 of 
title 28, United States Code.

SEC. 5. DEFINITIONS.

    As used in this Act:
            (1) Claimant.--The term ``claimant'' means any person who 
        alleges a medical malpractice liability claim, and any person 
        on whose behalf such a claim is alleged, including the decedent 
        in the case of an action brought through or on behalf of an 
        estate.
            (2) Economic damages.--The term ``economic damages'' means 
        damages paid to compensate an individual for hospital and other 
        medical expenses, lost wages, lost employment, and other 
        pecuniary losses.
            (3) Health care professional.--The term ``health care 
        professional'' means any individual who provides health care 
        services in a State and who is required by the laws or 
        regulations of the State to be licensed or certified by the 
        State to provide such services in the State.
            (4) Health care provider.--The term ``health care 
        provider'' means any organization or institution that is 
        engaged in the delivery of health care services in a State and 
        that is required by the laws or regulations of the State to be 
        licensed or certified by the State to engage in the delivery of 
        such services in the State.
            (5) Injury.--The term ``injury'' means any illness, 
        disease, or other harm that is the subject of a medical 
        malpractice liability action or a medical malpractice liability 
        claim.
            (6) Medical malpractice liability action.--The term 
        ``medical malpractice liability action'' means a civil action 
        brought in a State or Federal court against a health care 
        provider or health care professional in which the plaintiff 
        alleges a medical malpractice liability claim, but does not 
        include any action in which the plaintiff's sole allegation is 
        an allegation of an intentional tort.
            (7) Medical malpractice liability claim.--The term 
        ``medical malpractice liability claim'' means a claim in which 
        the claimant alleges that injury was caused by the provision of 
        (or the failure to provide) health care services or the use of 
        a medical product.
            (8) Medical product.--
                    (A) In general.--The term ``medical product'' 
                means, with respect to the allegation of a claimant, a 
                drug (as defined in section 201(g)(1) of the Federal 
                Food, Drug, and Cosmetic Act (21 U.S.C. 321(g)(1)) or a 
                medical device (as defined in section 201(h) of the 
                Federal Food, Drug, and Cosmetic Act (21 U.S.C. 321(h)) 
                if--
                            (i) such drug or device was subject to 
                        premarket approval under section 505, 507, or 
                        515 of the Federal Food, Drug, and Cosmetic Act 
                        (21 U.S.C. 355, 357, or 360e) or section 351 of 
                        the Public Health Service Act (42 U.S.C. 262) 
                        with respect to the safety of the formulation 
                        or performance of the aspect of such drug or 
                        device which is the subject of the claimant's 
                        allegation or the adequacy of the packaging or 
                        labeling of such drug or device, and such drug 
                        or device is approved by the Food and Drug 
                        Administration; or
                            (ii) the drug or device is generally 
                        recognized as safe and effective under 
                        regulations issued by the Secretary of Health 
                        and Human Services under section 201(p) of the 
                        Federal Food, Drug, and Cosmetic Act (21 U.S.C. 
                        321(p)).
                    (B) Exception in case of misrepresentation or 
                fraud.--Notwithstanding subparagraph (A), the term 
                ``medical product'' shall not include any product 
                described in such subparagraph if the claimant shows 
                that the product is approved by the Food and Drug 
                Administration for marketing as a result of withheld 
                information, misrepresentation, or an illegal payment 
                by manufacturer of the product.
            (9) Noneconomic damages.--The term ``noneconomic damages'' 
        means damages paid to compensate an individual for physical and 
        emotional pain, suffering, inconvenience, physical impairment, 
        mental anguish, disfigurement, loss of enjoyment of life, loss 
        of consortium, and other nonpecuniary losses, but does not 
        include punitive damages.
            (10) Punitive damages.--The term ``punitive damages'' means 
        compensation, in addition to compensation for actual harm 
        suffered, that is awarded for the purpose of punishing a person 
        for conduct deemed to be malicious, wanton, willful, or 
        excessively reckless.
            (11) State.--The term ``State'' means each of the several 
        States, the District of Columbia, the Commonwealth of Puerto 
        Rico, the Virgin Islands, Guam, and American Samoa.

SEC. 6. EFFECTIVE DATE.

    This Act shall apply with respect to claims accruing or actions 
brought on or after the date of the enactment of this Act.