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[Congressional Bills 104th Congress]
[From the U.S. Government Publishing Office]
[H.R. 229 Introduced in House (IH)]

104th CONGRESS
  1st Session
                                H. R. 229

To impose certain requirements on medical malpractice liability claims.

_______________________________________________________________________

                    IN THE HOUSE OF REPRESENTATIVES

                            January 4, 1995

  Mr. Dornan introduced the following bill; which was referred to the 
   Committee on the Judiciary and, in addition, to the Committee on 
Commerce, for a period to be subsequently determined by the Speaker, in 
   each case for consideration of such provisions as fall within the 
                jurisdiction of the committee concerned

_______________________________________________________________________

                                 A BILL

 
To impose certain requirements on medical malpractice liability claims.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Medical Injury Compensation Reform 
Act of 1995''.

SEC. 2. GENERAL PROVISIONS.

    (a) Congressional Findings.--
            (1) Effect on interstate commerce.--The Congress finds that 
        the health care and insurance industries are industries 
        affecting interstate commerce and the medical malpractice 
        litigation systems existing throughout the United States affect 
        interstate commerce by contributing to the high cost of health 
        care and premiums for malpractice insurance purchased by health 
        care providers.
            (2) Effect on federal spending.--The Congress finds that 
        the medical malpractice litigation systems existing throughout 
        the United States have a significant effect on the amount, 
        distribution, and use of Federal funds because of--
                    (A) the large number of individuals who receive 
                health care benefits under programs operated or 
                financed by the Federal Government;
                    (B) the large number of individuals who benefit 
                because of the exclusion from Federal taxes of the 
                amounts spent by their employers to provide them with 
                health insurance benefits;
                    (C) the large number of health care providers and 
                health care professionals who provide items or services 
                for which the Federal Government makes payments; and
                    (D) the large number of such providers and 
                professionals who have received direct or indirect 
                financial assistance from the Federal Government 
                because of their status as such professionals or 
                providers.
    (b) 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 Act shall not apply to--
            (1) 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; or
            (2) a claim or action in which the claimant's sole 
        allegation is an allegation of an injury arising from the use 
        of a medical product.
    (c) Preemption of State Law.--Subject to section 10, this Act 
supersedes State law only to the extent that State law differs from any 
provision of law established by or under this Act. Any issue that is 
not governed by any provision of law established by or under this Act 
shall be governed by otherwise applicable State or Federal law.
    (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. 3. DEFINITIONS.

    As used in this Act:
            (1) Claimant.--The term ``claimant'' means any person who 
        alleges a medical malpractice liability claim or, in the case 
        of an individual who is deceased, incompetent, or a minor, the 
        person on whose behalf such a claim is alleged.
            (2) Economic damages.--The term ``economic damages'' means 
        damages paid to compensate an individual for losses 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 State law or 
        regulation 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 State law or regulation 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 claim.
            (6) Medical malpractice liability action.--The term 
        ``medical malpractice liability action'' means a civil action 
        (other than an action in which the claimant's sole allegation 
        is an allegation of an intentional tort) brought in a State or 
        Federal court against a health care provider or health care 
        professional (regardless of the theory of liability on which 
        the action is based) in which the claimant alleges a medical 
        malpractice liability claim.
            (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.
            (8) Medical product.--The term ``medical product'' means a 
        device (as defined in section 201(h) of the Federal Food, Drug, 
        and Cosmetic Act) or a drug (as defined in section 201(g)(1) of 
        the Federal Food, Drug, and Cosmetic Act).
            (9) Noneconomic damages.--The term ``noneconomic damages'' 
        means damages paid to compensate an individual for losses 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) Secretary.--The term ``Secretary'' means the Secretary 
        of Health and Human Services.
            (11) State.--The term ``State'' means each of the several 
        States, the District of Columbia, the Commonwealth of Puerto 
        Rico, and any other territory or possession of the United 
        States.

SEC. 4. EFFECTIVE DATE.

    (a) In General.--Except as provided in subsection (b) and section 
11, this Act shall apply with respect to claims accruing or actions 
brought on or after the expiration of the 3-year period that begins on 
the date of the enactment of this Act.
    (b) Exception for States Requesting Earlier Implementation of 
Reforms.--
            (1) Application.--A State may submit an application to the 
        Secretary requesting the early implementation of this Act with 
        respect to claims or actions brought in the State.
            (2) Decision by secretary.--The Secretary shall issue a 
        response to a State's application under paragraph (1) not later 
        than 90 days after receiving the application. If the Secretary 
        determines that the State meets the requirements of this Act at 
        the time of submitting its application, the Secretary shall 
        approve the State's application, and this Act shall apply with 
        respect to actions brought in the State on or after the 
        expiration of the 90-day period that begins on the date the 
        Secretary issues the response. If the Secretary denies the 
        State's application, the Secretary shall provide the State with 
        a written explanation of the grounds for the decision.

SEC. 5. STATUTE OF LIMITATIONS.

    (a) In General.--No medical malpractice liability claim may be 
brought after the expiration of the 2-year period that begins on the 
date the alleged injury that is the subject of the action should 
reasonably have been discovered, but in no event after the expiration 
of the 4-year period that begins on the date the alleged injury 
occurred.
    (b) Exception for Minors.--In the case of an alleged injury 
suffered by a minor who has not attained 6 years of age, no medical 
malpractice liability claim may be brought after the expiration of the 
2-year period that begins on the date the alleged injury that is the 
subject of the action should reasonably have been discovered, but in no 
event after the date on which the minor attains 10 years of age.

SEC. 6. ATTORNEYS' FEES.

    (a) Limitation on Contingency Fees.--An attorney shall not contract 
for or collect a contingency fee for representing a claimant in a 
medical malpractice liability action in excess of the following:
            (1) 40 percent of the first $50,000 (or portion thereof) of 
        the amount recovered by the claimant.
            (2) 33\1/3\ percent of the next $50,000 (or portion 
        thereof) of the amount recovered by the claimant.
            (3) 25 percent of the next $500,000 (or portion thereof) of 
        the amount recovered by the claimant.
            (4) 15 percent of any amounts recovered by the claimant in 
        excess of $600,000.
This subsection applies whether the recovery is by settlement, 
arbitration, or judgment.
    (b) Calculation of Periodic Payments.--If periodic payments are 
awarded to the claimant pursuant to section 7(b), the court shall place 
a total value on these payments based upon the projected life 
expectancy of the claimant and include this amount in computing the 
total award from which attorneys' fees are calculated under subsection 
(a).
    (c) Effect of Failure To Comply.--Failure to comply with this 
section by an attorney at law shall be grounds for professional 
discipline by the appropriate State agency responsible for the conduct 
of disciplinary actions against attorneys-at-law.
    (d) Definitions.--For purposes of this section--
            (1) the term ``contingency fee'' means any fee for 
        professional legal services which is in whole or in part 
        contingent upon the recovery of any amount of damages, whether 
        through judgment or settlement; and
            (2) the term ``recovered'' means the net sum recovered 
        after deducting any disbursements or costs incurred in 
        connection with prosecution or settlement of the claim, except 
        that costs of medical care incurred by the claimant and the 
        attorney's office overhead costs or charges shall not be 
        deductible disbursements under this paragraph.

SEC. 7. CALCULATION AND PAYMENT OF DAMAGES.

    (a) Limitation on Noneconomic Damages.--The total amount of 
noneconomic damages that may be awarded to a claimant for losses 
resulting from the injury which is the subject of a medical malpractice 
liability action may not exceed $250,000, regardless of the number of 
parties against whom the action is brought or the number of actions 
brought with respect to the injury.
    (b) Periodic Payments for Future Losses.--If more than $50,000 in 
damages for expenses to be incurred in the future is awarded to the 
claimant in a medical malpractice liability action, the court shall, at 
the request of either party, enter a judgment ordering such damages to 
be paid on a periodic basis determined appropriate by the court (based 
upon projections of when such expenses are likely to be incurred).
    (c) Mandatory Offsets for Damages Paid by a Collateral Source.--The 
total amount of damages received by a claimant in a medical malpractice 
liability action shall be reduced by any other payment that has been or 
will be made to the individual to compensate the claimant for the 
injury that was the subject of the action, including payment under--
            (1) Federal or State disability or sickness programs;
            (2) Federal, State, or private health insurance programs;
            (3) private disability insurance programs;
            (4) employer wage continuation programs; and
            (5) any other source of payment intended to compensate the 
        claimant for such injury.

SEC. 8. NOTICE OF ACTION.

    (a) Notice Requirement.--
            (1) In general.--No medical malpractice liability action 
        may be commenced unless the defendant has been given at least 
        90 days notice of the intention to commence the action.
            (2) Contents of notice.--The notice under paragraph (1) 
        shall include the legal basis of the medical malpractice 
        liability claim on which the action is based and the type of 
        loss sustained, including the specific nature of the injuries 
        suffered.
    (b) Effect on Statute of Limitations.--If the notice under 
paragraph (1) is served within 90 days before the expiration of the 
statute of limitations for filing the medical malpractice liability 
action, the time for commencing the action shall extend for 90 days 
after the notice under paragraph (1) is served.
    (c) Effect of Failure To Comply.--Failure to comply with this 
section shall not invalidate any court proceedings in the medical 
malpractice liability action involved, and shall not affect the 
jurisdiction of the court to render a judgment in the action, but a 
failure to comply with this section by an attorney at law shall be 
grounds for professional discipline by the appropriate State agency 
responsible for the conduct of disciplinary actions against attorneys-
at-law.

SEC. 9. INJUNCTIVE RELIEF.

    Whenever any person has engaged or is about to engage in any 
conduct in violation of this Act, the appropriate court may, upon 
application of an interested party, issue an injunction or other 
appropriate order restraining such conduct.

SEC. 10. PREEMPTION.

    (a) In General.--The preceding provisions of this Act supersede any 
State law only to the extent that State law--
            (1) permits the recovery of a greater amount of damages by 
        claimant;
            (2) permits the collection of a greater amount of 
        attorneys' fees by a claimant's attorney; or
            (3) establishes a longer period during which a medical 
        malpractice liability claim may be initiated.
    (b) Effect on Sovereign Immunity and Choice of Law or Venue.--
Nothing in subsection (a) 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 country or a citizen of a foreign 
        country; or
            (5) affect the right of any court to transfer venue or to 
        apply the law of a foreign country or to dismiss a claim of a 
        foreign country or of a citizen of a foreign nation on the 
        ground of inconvenient forum.

SEC. 11. PERMITTING STATE PROFESSIONAL SOCIETIES TO PARTICIPATE IN 
              DISCIPLINARY ACTIVITIES.

    (a) Role of Professional Societies.--Notwithstanding any other 
provision of State or Federal law, a State agency responsible for the 
conduct of disciplinary actions for a type of health care practitioner 
may enter into agreements with State or county professional societies 
of such type of health care practitioner to permit such societies to 
participate in the licensing of such health care practitioner, and to 
review any health care malpractice action, health care malpractice 
claim or allegation, or other information concerning the practice 
patterns of any such health care practitioner. Any such agreement shall 
comply with subsection (b).
    (b) Requirements of Agreements.--Any agreement entered into under 
subsection (a) for licensing activities or the review of any health 
care malpractice action, health care malpractice claim or allegation, 
or other information concerning the practice patterns of a health care 
practitioner shall provide that--
            (1) the health care professional society conducts such 
        activities or review as expeditiously as possible;
            (2) after the completion of such review, such society shall 
        report its findings to the State agency with which it entered 
        into such agreement;
            (3) the conduct of such activities or review and the 
        reporting of such findings be conducted in a manner which 
        assures the preservation of confidentiality of health care 
        information and of the review process; and
            (4) no individual affiliated with such society is liable 
        for any damages or injury directly caused by the individual's 
        actions in conducting such activities or review.
    (c) Agreements Not Mandatory.--Nothing in this section may be 
construed to require a State to enter into agreements with societies 
described in subsection (a) to conduct the activities described in such 
subsection.
    (d) Effective Date.--This section shall take effect 2 years after 
the date of the enactment of this Act.

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