II

107TH CONGRESS

1ST SESSION S. 1370

To reform the health care liability system.

IN THE SENATE OF THE UNITED STATES

AUGUST 3, 2001

Mr. MCCONNELL introduced the following bill; which was read twice and

referred to the Committee on the Judiciary

A BILL

To reform the health care liability system.

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled,

3 SECTION 1. SHORT TITLE; TABLE OF CONTENTS.

4 (a) SHORT TITLE.—This Act may be cited as the

5 ‘‘Common Sense Medical Malpractice Reform Act of

6 2001’’.

7 (b) TABLE OF CONTENTS.—The table of contents of

8 this Act is as follows:

Sec. 1. Short title; table of contents.

Sec. 2. Findings and purpose.

Sec. 3. Definitions.

Sec. 4. Applicability.

Sec. 5. Statute of limitations.

Sec. 6. Limitation on non-economic damages.

Sec. 7. Reform of punitive damages.

Sec. 8. Periodic payments.
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Sec. 9. Scope of liability.

Sec. 10. Mandatory offsets for damages paid by a collateral source.

Sec. 11. Treatment of attorneys’ fees and other costs.

Sec. 12. State-based alternative dispute resolution mechanisms.

Sec. 13. Applicability.

Sec. 14. Severability.

1 SEC. 2. FINDINGS AND PURPOSE.

2 (a) FINDINGS.—Congress finds the following:

3 (1) EFFECT ON HEALTH CARE ACCESS AND

4 COSTS.—The civil justice system of the United

5 States is a costly and inefficient mechanism for re6 solving claims of health care liability and compen7 sating injured patients and that the problems associ8 ated with the current system are having an adverse

9 impact on the availability of, and access to, health

10 care services and the cost of health care in the

11 United States.

12 (2) EFFECT ON INTERSTATE COMMERCE.—The

13 health care and insurance industries are industries

14 affecting interstate commerce and the health care li15 ability litigation systems existing throughout the

16 United States affect interstate commerce by contrib17 uting to the high cost of health care and premiums

18 for health care liability insurance purchased by par19 ticipants in the health care system.

20 (3) EFFECT ON FEDERAL SPENDING.—The

21 health care liability litigation systems existing

22 throughout the United States have a significant ef-
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1 fect on the amount, distribution, and use of Federal

2 funds because of—

3 (A) the large number of individuals who

4 receive health care benefits under programs op5 erated or financed by the Federal Government;

6 (B) the large number of individuals who

7 benefit because of the exclusion from Federal

8 taxes of the amounts spent to provide them

9 with health insurance benefits; and

10 (C) the large number of health care pro11 viders who provide items or services for which

12 the Federal Government makes payments.

13 (b) PURPOSE.—It is the purpose of this Act to imple14 ment reasonable, comprehensive, and effective health care

15 liability reform that is designed to—

16 (1) ensure that individuals with meritorious

17 health care injury claims receive fair and adequate

18 compensation;

19 (2) improve the availability of health care serv20 ice in cases in which health care liability actions

21 have been shown to be a factor in the decreased

22 availability of services; and

23 (3) improve the fairness and cost-effectiveness

24 of our current health care liability system of the

25 United States to resolve disputes over, and provide
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1 compensation for, health care liability by reducing

2 uncertainty and unpredictability in the amount of

3 compensation provided to injured individuals.

4 SEC. 3. DEFINITIONS.

5 In this Act:

6 (1) ALTERNATIVE DISPUTE RESOLUTION

7 (ADR).—The term ‘‘alternative dispute resolution’’ or

8 ‘‘adr’’ means a system that provides for the resolu9 tion of health care liability claims or actions in a

10 manner other than through a civil action brought in

11 a Federal or State court.

12 (2) ATTORNEY.—The term ‘‘attorney’’ means

13 any natural person, professional association, cor14 poration, or partnership authorized under applicable

15 law to practice law.

16 (3) ATTORNEY SERVICES.—The term ‘‘attorney

17 services’’ means the professional advice or counseling

18 of or representation by an attorney. Such term shall

19 not include out-of-pocket expenses in connection

20 with providing attorney services, such as travel ex21 penses, witness fees, copying, messengers, postage,

22 phone, or preparation by a person other than the at23 torney of any study, analysis, report, or test.

24 (4) CLAIMANT.—The term ‘‘claimant’’ means

25 any person who commences a health care liability ac-
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1 tion, and any person on whose behalf such an action

2 is commenced, including the decedent in the case of

3 an action brought through or on behalf of an estate.

4 (5) CLEAR AND CONVINCING EVIDENCE.—The

5 term ‘‘clear and convincing evidence’’ means that

6 measure or degree of proof that will produce in the

7 mind of the trier of fact a firm belief or conviction

8 as to the truth of the allegations sought to be estab9 lished, except that such measure or degree of proof

10 is more than that required under preponderance of

11 the evidence, but less than that required for proof

12 beyond a reasonable doubt.

13 (6) COLLATERAL SOURCE BENEFIT.—The term

14 ‘‘collateral source benefit’’ means a rule, either es15 tablished in statute or established at common law,

16 that prevents the introduction of evidence regarding

17 collateral source benefits or that prohibits the deduc18 tion of collateral source benefits from an award of

19 damages in a health care liability action.

20 (7) ECONOMIC LOSSES.—The term ‘‘economic

21 losses’’ means objectively verifiable monetary losses

22 incurred as a result of the provision of (or failure to

23 provide or pay for) health care services or the use

24 of a medical product, including past and future med25 ical expenses, loss of past and future earnings, cost
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1 of obtaining replacement services in the home (in2 cluding child care, transportation, food preparation,

3 and household care), cost of making reasonable ac4 commodations to a personal residence, loss of em5 ployment, and loss of business or employment oppor6 tunities. Economic losses are neither non-economic

7 losses nor punitive damages.

8 (8) HEALTH CARE LIABILITY ACTION.—The

9 term ‘‘health care liability action’’ means a civil ac10 tion brought in a State or Federal court pursuant to

11 ADR against a health care provider, health care pro12 fessional, or other defendant, including a right to

13 legal or equitable contribution, indemnity, subroga14 tion, third-party claims, cross claims, or counter15 claims, in which the claimant alleges injury related

16 to—

17 (A) the provision of health care services or

18 medical products; or

19 (B) the failure to provide for health care

20 services or medical products;

21 regardless of the theory of liability on which the ac22 tion is based. Such term does not include a product

23 liability action, except where such an action is

24 brought as part of a broader health care liability ac25 tion.
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1 (9) HEALTH CARE PROFESSIONAL.—The term

2 ‘‘health care professional’’ means any individual who

3 provides health care services in a State and who is

4 required by Federal or State laws or regulations to

5 be licensed, registered or certified to provide such

6 services or who is certified to provide health care

7 services pursuant to a program of education, train8 ing and examination by an accredited institution,

9 professional board, or professional organization.

10 (10) HEALTH CARE PROVIDER.—The term

11 ‘‘health care provider’’ means any organization or

12 institution that is engaged in the delivery of health

13 care items or services in a State and that is required

14 by Federal or State laws or regulations to be li15 censed, registered or certified to engage in the deliv16 ery of such items or services.

17 (11) HEALTH PLAN.—The term ‘‘health plan’’

18 means an employee welfare benefit plan (as defined

19 in section 3(1) of the Employee Retirement Income

20 Security Act of 1974 (29 U.S.C. 1002(1))) to the

21 extent that the plan provides medical care (including

22 items and services paid for as medical care) to em23 ployees or their dependents (as defined under the

24 terms of the plan) directly or through insurance, re25 imbursement, or otherwise.
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1 (12) HEALTH CARE SERVICES.—The term

2 ‘‘health care services’’ means any services provided

3 by a health care professional or health care provider,

4 or any individual working under the supervision of

5 a health care professional, that relate to the diag6 nosis, prevention, or treatment of any disease or im7 pairment, or the assessment of the health of human

8 beings.

9 (13) INJURY.—The term ‘‘injury’’ means any

10 illness, disease, or other harm that is the subject of

11 a health care liability action.

12 (14) NONECONOMIC LOSSES.—The term ‘‘non13 economic losses’’ means losses for physical and emo14 tional pain, suffering, inconvenience, physical im15 pairment, mental anguish, disfigurement, loss of en16 joyment of life, loss of consortium, loss of society or

17 companionship (other than loss of domestic serv18 ices), and other non-pecuniary losses incurred by an

19 individual with respect to which a health care liabil20 ity action is brought. Noneconomic losses are neither

21 economic losses nor punitive damages.

22 (15) PUNITIVE DAMAGES.—The term ‘‘punitive

23 damages’’ means damages awarded, for the purpose

24 of punishment or deterrence, and not for compen25 satory purposes, against a health care provider,
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1 health care professional, or other defendant in a

2 health care liability action. Punitive damages are

3 neither economic nor noneconomic damages.

4 (16) SECRETARY.—The term ‘‘Secretary’’

5 means the Secretary of Health and Human Services.

6 (17) STATE.—The term ‘‘State’’ means each of

7 the several States of the United States, the District

8 of Columbia, and the Commonwealth of Puerto Rico,

9 a territory of possession of the United States, an

10 agency or instrumentality of a State, and a multi11 State, regional, or interstate entity having govern12 mental duties and powers.

13 (18) STATE LAW.—The term ‘‘State law’’ in14 cludes all constitutional provisions, statutes, laws,

15 judicial decisions, rules regulations, or other State

16 action having the effect of law of, or any State.

17 SEC. 4. APPLICABILITY.

18 (a) IN GENERAL.—Except as provided in subsections

19 (c) and (d), this Act shall apply with respect to any health

20 care liability action brought in any Federal or State court,

21 and any claim brought pursuant to an alternative dispute

22 resolution, except that this Act shall not apply to an action

23 for damages arising from a vaccine-related injury or death

24 to the extent that title XXI of the Public Health Service

25 Act applies to the action.
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1 (b) PREEMPTION.—

2 (1) IN GENERAL.—The provisions of this Act

3 shall preempt any State law in effect on, or enacted

4 after, the date of enactment of this Act to the extent

5 that such law is inconsistent with the limitations

6 contained in such provisions. The provisions of this

7 Act shall not preempt any State law to the extent

8 that such law—

9 (A) places greater restrictions on the

10 amount of or standards for awarding economic

11 or punitive damages than those provided for in

12 this Act;

13 (B) places greater limitations on the

14 awarding of attorneys fees for awards in excess

15 of $150,000 than those provided for in this Act;

16 (C) permits a lower threshold for the peri17 odic payment of future damages than that pro18 vided for in this Act;

19 (D) establishes a shorter period during

20 which a health care liability action may be initi21 ated or a more restrictive rule with respect to

22 the time at which the period of limitations be23 gins to run than that provided for in this Act;

24 or
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1 (E) either permits the introduction of evi2 dence of collateral source benefits or provides

3 for the mandatory offset of collateral source

4 benefits from damage awards.

5 (2) RULE OF CONSTRUCTION.—The provisions

6 of this Act shall not be construed to preempt any

7 State law that—

8 (A) permits State officials to commence

9 health care liability actions as a representative

10 of an individual;

11 (B) permits provider-based alternative dis12 pute resolution;

13 (C) places a maximum limit on the total

14 damages in a health care liability action;

15 (D) places a maximum limit on the time in

16 which a health care liability action may be initi17 ated; or

18 (E) provides for defenses in addition to

19 those contained in this Act.

20 (c) STATE OPTION.—

21 (1) IN GENERAL.—With respect to a provision

22 of this Act, such provision shall not apply to a

23 health care liability action involving parties that are

24 residents of the same State if the action is brought
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1 in a court of that State and the State has enacted

2 a law—

3 (A) specifically citing the authority of this

4 subsection; and

5 (B)(i) proclaiming that the State has de6 termined that such provision shall not apply to

7 such actions; or

8 (ii) establishing provisions that specifically

9 contradict the provisions of this Act.

10 (2) MULTIPLE STATE.—With respect to a

11 health care liability action involving parties that are

12 residents of more than one State, if each such State

13 has enacted a law described in paragraph (1), the

14 choice-of-law rules of each such State shall govern

15 the rules and procedures applicable in the action.

16 (3) CORPORATE ENTITY.—For purposes of this

17 subsection, a corporate entity shall be deemed to be

18 a resident of the State in which such entity is incor19 porated and the State in which the principal place

20 of business of the entity is located.

21 (4) RULE OF CONSTRUCTION.—Nothing in this

22 subsection shall be construed as requiring a State to

23 reenact any provision of State law if such law ex24 isted on the date of enactment of this Act and such
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1 law is not otherwise preempted under the provisions

2 of subsection (b).

3 (d) EFFECT ON SOVEREIGN IMMUNITY AND CHOICE

4 OF LA W OR VENUE.—Nothing in this Act shall be con5 strued to—

6 (1) waive or affect any defense of sovereign im7 munity asserted by any State under any provision of

8 law;

9 (2) waive or affect any defense of sovereign im10 munity asserted by the United States;

11 (3) affect the applicability of any provision of

12 the Foreign Sovereign Immunities Act of 1976;

13 (4) preempt State choice-of-law rules with re14 spect to actions brought by a foreign nation or a cit15 izen of a foreign nation;

16 (5) affect the right of any court to transfer

17 venue or to apply the law of a foreign nation or to

18 dismiss an action of a foreign nation or of a citizen

19 of a foreign nation on the ground of inconvenient

20 forum; or

21 (6) supersede any provision of Federal law.

22 (e) FEDERAL COURT JURISDICTION NOT ESTAB23 LISHED ON FEDERAL QUESTION GROUNDS.—Nothing in

24 this Act shall be construed to establish any jurisdiction

25 in the district courts of the United States over health care
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1 liability actions on the basis of sections 1331 or 1337 of

2 title 28, United States Code.

3 SEC. 5. STATUTE OF LIMITATIONS.

4 A health care liability action that is subject to this

5 Act may not be initiated unless a complaint with respect

6 to such action is filed within the 2-year period beginning

7 on the date on which the claimant discovered or, in the

8 exercise of reasonable care, should have discovered the in9 jury and its cause, except that such an action relating to

10 a claimant under legal disability may be filed within 2

11 years after the date on which the disability ceases. If the

12 commencement of a health care liability action is stayed

13 or enjoined, the running of the statute of limitations under

14 this section shall be suspended for the period of the stay

15 or injunction.

16 SEC. 6. LIMITATION ON NON-ECONOMIC DAMAGES.

17 (a) IN GENERAL.—In any health care liability action

18 that is subject to this Act, the amount of noneconomic

19 damages shall not exceed $250,000 regardless of the num20 ber of parties against whom the action is brought or the

21 number of claims or actions brought with respect to the

22 injury that is the subject of the action.

23 (b) CALCULATION OF AWARD.—For purposes of this

24 section, an award for future noneconomic damages in a

25 health care liability action shall not be discounted to
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1 present value. A jury shall not be informed about the limi2 tation on noneconomic damages in such an action. Any

3 award for noneconomic damages that is in excess of

4 $250,000 shall be reduced prior to the entry of judgment

5 or by an amendment of the judgment after such entry.

6 Any award of damages for noneconomic losses that is in

7 excess of $250,000, shall be reduced to $250,000 before

8 accounting for any other reduction in damages required

9 by law. If separate awards of damages for past and future

10 noneconomic damages are rendered and the combined

11 awards exceed $250,000, the award of damages for future

12 noneconomic losses shall be reduced first.

13 SEC. 7. REFORM OF PUNITIVE DAMAGES.

14 (a) LIMITATION.—With respect to a health care li15 ability action, an award for punitive damages may only

16 be made, if otherwise permitted by applicable law, if it

17 is proven by clear and convincing evidence that the

18 defendant—

19 (1) intended to injure the claimant for a reason

20 unrelated to the provision of health care services;

21 (2) understood the claimant was substantially

22 certain to suffer unnecessary injury, and in pro23 viding or failing to provide health care services, the

24 defendant deliberately failed to avoid such injury; or
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1 (3) acted with a conscious disregard of a sub2 stantial and unjustifiable risk of unnecessary injury

3 which the defendant failed to avoid in a manner

4 which constitutes a gross deviation from the normal

5 standard of conduct in such circumstances.

6 (b) PUNITIVE DAMAGES NOT PERMITTED.—Not7 withstanding the provisions of subsection (a), punitive

8 damages may not be awarded against a defendant with

9 respect to any health care liability action if no judgment

10 for compensatory damages, including nominal damages

11 (under $500), is rendered against the defendant.

12 (c) REQUIREMENTS FOR PLEADING OF PUNITIVE

13 DAMAGES.—

14 (1) IN GENERAL.—No demand for punitive

15 damages shall be included in a health care liability

16 action as initially filed.

17 (2) AMENDED PLEADING.—A court may allow a

18 claimant to file an amended complaint or pleading

19 for punitive damages in a health care liability action

20 if—

21 (A) the claimant submits a motion to

22 amend the complaint or pleading within the

23 earlier of—

24 (i) 2 years after the complaint or ini25 tial pleading is filed, or
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1 (ii) 9 months before the date the mat2 ter is first set for trial; and

3 (B) after a finding by a court upon review

4 of supporting and opposing affidavits or after a

5 hearing, that after weighing the evidence the

6 claimant has established by a substantial prob7 ability that the claimant will prevail on the

8 claim for punitive damages.

9 (d) SEPARATE PROCEEDING.—

10 (1) IN GENERAL.—At the request of any de11 fendant in a health care liability action, the trier of

12 fact shall consider in a separate proceeding—

13 (A) whether punitive damages are to be

14 awarded and the amount of such award, or

15 (B) the amount of punitive damages fol16 lowing a determination of punitive liability.

17 (2) ONLY RELEVANT EVIDENCE ADMISSIBLE.—

18 If a defendant requests a separate proceeding under

19 paragraph (1), evidence relevant only to the claim of

20 punitive damages in a health care liability action, as

21 determined by applicable State law, shall be inadmis22 sible in any proceeding to determine whether com23 pensatory damages are to be awarded.

24 (e) DETERMINING AMOUNT OF PUNITIVE DAM25 AGES.—In determining the amount of punitive damages
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1 in a health care liability action, the trier of fact shall con2 sider only the following:

3 (1) The severity of the harm caused by the con4 duct of the defendant.

5 (2) The duration of the conduct or any conceal6 ment of it by the defendant.

7 (3) The profitability of the conduct of the de8 fendant.

9 (4) The number of products sold or medical

10 procedures rendered for compensation, as the case

11 may be, by the defendant of the kind causing the

12 harm complained of by the claimant.

13 (5) Awards of punitive or exemplary damages

14 to persons similarly situated to the claimant, when

15 offered by the defendant.

16 (6) Prospective awards of compensatory dam17 ages to persons similarly situated to the claimant.

18 (7) Any criminal penalties imposed on the de19 fendant as a result of the conduct complained of by

20 the claimant, when offered by the defendant.

21 (8) The amount of any civil fines assessed

22 against the defendant as a result of the conduct

23 complained of by the claimant, when offered by the

24 defendant.
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1 (f) LIMITATION AMOUNT.—The amount of damages

2 that may be awarded as punitive damages in any health

3 care liability action shall not exceed 3 times the amount

4 awarded to the claimant for the economic injury on which

5 such claim is based, or $250,000, whichever is greater.

6 This subsection shall be applied by the court and shall

7 not be disclosed to the jury.

8 (g) RESTRICTIONS PERMITTED.—Nothing in this

9 section shall be construed to imply a right to seek punitive

10 damages where none exists under Federal or State law.

11 SEC. 8. PERIODIC PAYMENTS.

12 With respect to a health care liability action, if the

13 award of future damages exceeds $100,000, the adjudi14 cating body shall, at the request of either party, enter a

15 judgment ordering that future damages be paid on a peri16 odic basis in accordance with the guidelines contained in

17 the Uniform Periodic Payments of Judgments Act, as pro18 mulgated by the National Conference of Commissioners on

19 Uniform State Laws in July of 1990. The adjudicating

20 body may waive the requirements of this section if such

21 body determines that such a waiver is in the interests of

22 justice.

23 SEC. 9. SCOPE OF LIABILITY.

24 (a) IN GENERAL.—With respect to punitive and non25 economic damages, the liability of each defendant in a
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1 health care liability action shall be several only and may

2 not be joint. Such a defendant shall be liable only for the

3 amount of punitive or noneconomic damages allocated to

4 the defendant in direct proportion to such defendant’s per5 centage of fault or responsibility for the injury suffered

6 by the claimant.

7 (b) DETERMINATION OF PERCENTAGE OF LIABIL8 ITY.—With respect to punitive and noneconomic damages,

9 the trier of fact in a health care liability action shall deter10 mine the extent of each defendant’s fault or responsibility

11 for injury suffered by the claimant, and shall assign a per12 centage of responsibility for such injury to each such de13 fendant.

14 SEC. 10. MANDATORY OFFSETS FOR DAMAGES PAID BY A

15 COLLATERAL SOURCE.

16 (a) IN GENERAL.—With respect to a health care li17 ability action, the total amount of damages received by

18 an individual under such action shall be reduced, in ac19 cordance with subsection (b), by any other payment that

20 has been, or will be, made to an individual to compensate

21 such individual for the injury that was the subject of such

22 action.

23 (b) AMOUNT OF REDUCTION.—The amount by which

24 an award of damages to an individual for an injury shall

25 be reduced under subsection (a) shall be—
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1 (1) the total amount of any payments (other

2 than such award) that have been made or that will

3 be made to such individual to pay costs of or com4 pensate such individual for the injury that was the

5 subject of the action; minus

6 (2) the amount paid by such individual (or by

7 the spouse, parent, or legal guardian of such indi8 vidual) to secure the payments described in para9 graph (1).

10 (c) DETERMINATION OF COLLATERAL SOURCE BEN11 EFITS.—The reductions required under subsection (b)

12 shall be determined by the court in a pretrial proceeding.

13 At the subsequent trial—

14 (1) no evidence shall be admitted as to the

15 amount of any charge, payments, or damage for

16 which a claimant—

17 (A) has received payment from a collateral

18 source or the obligation for which has been as19 sured by a third party; or

20 (B) is, or with reasonable certainty, will be

21 eligible to receive payment from a collateral

22 source of the obligation which will, with reason23 able certainty be assumed by a third party; and

24 (2) the jury, if any, shall be advised that—
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1 (A) except for damages as to which the

2 court permits the introduction of evidence, the

3 claimant’s medical expenses and lost income

4 have been or will be paid by a collateral source

5 or third party; and

6 (B) the claimant shall receive no award for

7 any damages that have been or will be paid by

8 a collateral source or third party.

9 SEC. 11. TREATMENT OF ATTORNEYS’ FEES AND OTHER

10 COSTS.

11 (a) IN GENERAL.—No attorney in any health care

12 liability action to which this Act applies shall charge, de13 mand, receive, or collect for services rendered in connec14 tion with such action in excess of 25 percent of any judg15 ment or settlement recovered under such action.

16 (b) CALCULATION OF PERIODIC PAYMENTS.—In the

17 event that a judgment or settlement includes periodic or

18 future payments of damages, the amount recovered for

19 purposes of computing the limitation under subsection (a)

20 shall be based on the cost of the annuity or trust estab21 lished to make the payments. In any case in which an an22 nuity or trust is not established to make such payments,

23 such amount shall be based on the present value of the

24 payments.
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1 SEC. 12. STATE-BASED ALTERNATIVE DISPUTE RESOLU2 TION MECHANISMS.

3 (a) ESTABLISHMENT BY STATES.—Each State is en4 couraged to establish or maintain alternative dispute reso5 lution mechanisms that promote the resolution of health

6 care liability claims in a manner that—

7 (1) is affordable for the parties involved in the

8 claims;

9 (2) provides for the timely resolution of claims;

10 and

11 (3) provides the parties with convenient access

12 to the dispute resolution process.

13 (b) GUIDELINES.—The Attorney General, in con14 sultation with the Secretary and the Administrative Con15 ference of the United States, shall develop guidelines with

16 respect to alternative dispute resolution mechanisms that

17 may be established by States for the resolution of health

18 care liability claims. Such guidelines shall include proce19 dures with respect to the following methods of alternative

20 dispute resolution:

21 (1) ARBITRATION.—The use of arbitration, a

22 nonjury adversarial dispute resolution process which

23 may, subject to subsection (d), result in a final deci24 sion as to facts, law, liability or damages. The par25 ties may elect binding arbitration.
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1 (2) MEDIATION.—The use of mediation, a set2 tlement process coordinated by a neutral third party

3 without the ultimate rendering of a formal opinion

4 as to factual or legal findings.

5 (3) EARLY NEUTRAL EVALUATION.—The use of

6 early neutral evaluation, in which the parties make

7 a presentation to a neutral attorney or other neutral

8 evaluator for an assessment of the merits, to encour9 age settlement. If the parties do not settle as a re10 sult of assessment and proceed to trial, the neutral

11 evaluator’s opinion shall be kept confidential.

12 (4) EARLY OFFER AND RECOVERY MECHA13 NISM.—The use of early offer and recovery mecha14 nisms under which a health care provider, health

15 care organization, or any other alleged responsible

16 defendant may offer to compensate a claimant for

17 his or her reasonable economic damages, including

18 future economic damages, less amounts available

19 from collateral sources.

20 (5) CERTIFICATE OF MERIT.—The requirement

21 that a claimant in a health care liability action sub22 mit to the court before trial a written report by a

23 qualified specialist that includes the specialist’s de24 termination that, after a review of the available med25 ical record and other relevant material, there is a
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1 reasonable and meritorious cause for the filing of the

2 action against the defendant.

3 (6) NO-FAULT.—The use of a no-fault statute

4 under which certain health care liability actions are

5 barred and claimants are compensated for injuries

6 through their health plans or through other appro7 priate mechanisms.

8 (c) FURTHER REDRESS.—

9 (1) IN GENERAL.—The extent to which any

10 party may seek further redress (subsequent to a de11 cision of an alternative dispute resolution method es12 tablished by a State under this section) concerning

13 a health care liability claim in a Federal or State

14 court shall be dependent upon the methods of alter15 native dispute resolution adopted by the State in16 volved.

17 (2) CLAIMANT.—With respect to further redress

18 described in paragraph (1), if the party initiating

19 such court action is the claimant and the claimant

20 receives a level of damages that is at least 25 per21 cent less under the decision of the court than under

22 the State alternative dispute resolution method, such

23 party shall bear the reasonable costs, including legal

24 fees, incurred in the court action by the other party

25 or parties to such action.
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1 (3) PROVIDER OR OTHER DEFENDANT.—With

2 respect to further redress described in paragraph

3 (1), if the party initiating a court action is the

4 health care professional or health care provider, or

5 other defendant in a health care liability action and

6 the health care professional, health care provider, or

7 other defendant is found liable for a level of dam8 ages that is at least 25 percent more under the deci9 sion of the court than under the State alternative

10 dispute resolution method, such party shall bear the

11 reasonable costs, including legal fees, incurred in the

12 court action by the other party or parties to such ac13 tion.

14 (d) TECHNICAL ASSISTANCE AND EVALUATIONS.—

15 (1) TECHNICAL ASSISTANCE.—The Attorney

16 General may provide States with technical assistance

17 in establishing or maintaining alternative dispute

18 resolution mechanisms under this section.

19 (2) EVALUATIONS.—The Attorney General, in

20 consultation with the Secretary and the Administra21 tive Conference of the United States, shall monitor

22 and evaluate the effectiveness of State alternative

23 dispute resolution mechanisms established or main24 tained under this section.
27

•S 1370 IS

1 SEC. 13. APPLICABILITY.

2 This Act shall apply to all civil actions covered under

3 this Act that are commenced on or after the date of enact4 ment of this Act, including any such action with respect

5 to which the harm asserted in the action or the conduct

6 that caused the harm occurred before the date of enact7 ment of this Act.

8 SEC. 14. SEVERABILITY.

9 If any provision of this Act, an amendment made by

10 this Act, or the application of such provision or amend11 ment to any person or circumstance is held to be unconsti12 tutional, the remainder of this Act, the amendments made

13 by this Act, and the application of the provisions of such

14 to any person or circumstance shall not be affected there15 by.

Æ