II 

112TH CONGRESS 

1ST SESSION S. 12 

To amend the Internal Revenue Code of 1986 to provide additional tax 

relief for private sector job creation, and for other purposes. 

IN THE SENATE OF THE UNITED STATES 

JANUARY 25 (legislative day, JANUARY 5), 2011 

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

to the Committee on Finance 

A BILL 

To amend the Internal Revenue Code of 1986 to provide 

additional tax relief for private sector job creation, and 

for other purposes. 

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; ETC. 

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

5 ‘‘Job Creation Act of 2011’’. 

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

7 this Act is as follows: 

Sec. 1. Short title; etc. 

TITLE I—TAX AND REGULATORY RELIEF 

Sec. 101. Temporary employer payroll tax cut. 

Sec. 102. Repeal of individual mandate. 


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Sec. 103. Repeal of expansion of information reporting requirements. 

Sec. 104. Environmental Protection Agency regulatory freeze. 

Sec. 105. Repeal of sunset on increased limitations on small business expensing. 

Sec. 106. Permanent extension of research credit. 

TITLE II—ENACTING REAL MEDICAL LIABILITY REFORM 

Sec. 201. Encouraging speedy resolution of claims. 

Sec. 202. Compensating patient injury. 

Sec. 203. Maximizing patient recovery. 

Sec. 204. Additional health benefits. 

Sec. 205. Punitive damages. 

Sec. 206. Authorization of payment of future damages to claimants in health 

care lawsuits. 

Sec. 207. Definitions. 

Sec. 208. Effect on other laws. 

Sec. 209. State flexibility and protection of States’ rights. 

Sec. 210. Applicability; effective date. 

1 TITLE I—TAX AND REGULATORY 

2 RELIEF 

3 SEC. 101. TEMPORARY EMPLOYER PAYROLL TAX CUT. 

4 (a) IN GENERAL.— 

5 (1) EMPLOYERS.—Section 601(a) of the Tax 

6 Relief, Unemployment Insurance Reauthorization, 

7 and Job Creation Act of 2010 is amended by strik8 ing ‘‘and’’ at the end of paragraph (1), by striking 

9 the period at the end of paragraph (2), and by add10 ing at the end the following new paragraph: 

11 ‘‘(3) with respect to remuneration received dur12 ing the payroll tax holiday period, the rate of tax 

13 under 3111(a) of such Code shall be 4.2 percent (in14 cluding for purposes of determining the applicable 

15 percentage under sections 3221(a) of such Code).’’. 

16 (2) SELF-EMPLOYED INDIVIDUALS.—Section 

17 601(a) of such Act is amended by striking ‘‘10.40 


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1 percent’’ in paragraph (1) and inserting ‘‘8.40 per2 cent’’. 

3 (b) CONFORMING AMENDMENTS.— 

4 (1) Section 601 of the Tax Relief, Unemploy5 ment Insurance Reauthorization, and Job Creation 

6 Act of 2010 is amended by striking subsection (b). 

7 (2) Section 601(e)(2) of such Act is amended 

8 by striking ‘‘subsection (a)(2)’’ and inserting ‘‘para9 graphs (2) and (3) of subsection (a)’’. 

10 (3) The headings for title VI and section 601 

11 of such Act are each amended by striking ‘‘em12 ployee’’. 

13 (c) EFFECTIVE DATE.— 

14 (1) IN GENERAL.—The amendments made by 

15 this section shall apply to wages paid and self-em16 ployment income earned after December 31, 2010. 

17 (2) SPECIAL TRANSITION RULE.— 

18 (A) NONAPPLICATION OF REDUCTION DUR19 ING FIRST QUARTER.—The amendments made 

20 by subsection (a)(1) shall not apply with respect 

21 to compensation paid during the first calendar 

22 quarter of 2011. 

23 (B) CREDITING OF FIRST QUARTER EX24 EMPTION DURING SECOND QUARTER.—The 

25 amount by which the tax imposed under secVerDate Mar 15 2010 04:53 Jan 26, 2011 Jkt 099200 PO 00000 Frm 00003 Fmt 6652 Sfmt 6201 E:\BILLS\S12.IS S12

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1 tions 3111(a) and 3221(a) of the Internal Rev2 enue Code of 1986 would (but for the applica3 tion of subparagraph (A)) have been reduced 

4 with respect to compensation paid by an em5 ployer during the first calendar quarter of 2011 

6 shall be treated as a payment against the tax 

7 imposed under section 3111(a) of such Code or 

8 section 3121(a) of such Code, as the case may 

9 be, with respect to the employer for the second 

10 calendar quarter of 2011 which is made on the 

11 date that such tax is due. 

12 SEC. 102. REPEAL OF INDIVIDUAL MANDATE. 

13 Section 5000A of the Internal Revenue Code of 1986, 

14 as added by the Patient Protection and Affordable Care 

15 Act, is amended by adding at the end the following new 

16 subsection: 

17 ‘‘(h) TERMINATION.—This section shall not apply 

18 with respect to any month beginning after the date of the 

19 enactment of this subsection.’’. 

20 SEC. 103. REPEAL OF EXPANSION OF INFORMATION RE21 PORTING REQUIREMENTS. 

22 (a) IN GENERAL.— 

23 (1) REPEAL OF PAYMENTS FOR PROPERTY AND

24 OTHER GROSS PROCEEDS.—Subsection (b) of section 

25 9006 of the Patient Protection and Affordable Care 


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1 Act, and the amendments made thereby, are hereby 

2 repealed; and the Internal Revenue Code of 1986 

3 shall be applied as if such subsection, and amend4 ments, had never been enacted. 

5 (2) REPEAL OF APPLICATION TO CORPORA6 TIONS AND REGULATORY AUTHORITY.— 

7 (A) IN GENERAL.—Section 6041 of the In8 ternal Revenue Code of 1986, as amended by 

9 section 9006(a) of the Patient Protection and 

10 Affordable Care Act and section 2101 of the 

11 Small Business Jobs Act of 2010, is amended 

12 by striking subsections (i) and (j). 

13 (B) EFFECTIVE DATE.—The amendment 

14 made by this paragraph shall apply to payments 

15 made after December 31, 2010. 

16 (b) RESCISSION OF UNSPENT FEDERAL FUNDS TO

17 OFFSET LOSS IN REVENUES.— 

18 (1) IN GENERAL.—Notwithstanding any other 

19 provision of law, of all available unobligated funds, 

20 $39,000,000,000 in appropriated discretionary funds 

21 are hereby rescinded. 

22 (2) IMPLEMENTATION.—The Director of the 

23 Office of Management and Budget shall determine 

24 and identify from which appropriation accounts the 

25 rescission under subsection (a) shall apply and the 


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1 amount of such rescission that shall apply to each 

2 such account. Not later than 60 days after the date 

3 of the enactment of this Act, the Director of the Of4 fice of Management and Budget shall submit a re5 port to the Secretary of the Treasury and Congress 

6 of the accounts and amounts determined and identi7 fied for rescission under the preceding sentence. 

8 (3) EXCEPTION.—This subsection shall not 

9 apply to the unobligated funds of the Department of 

10 Defense or the Department of Veterans Affairs.

11 SEC. 104. ENVIRONMENTAL PROTECTION AGENCY REGU12 LATORY FREEZE. 

13 (a) IN GENERAL.—Notwithstanding any other provi14 sion of law and beginning on the date of enactment of 

15 this Act, the Administrator of the Environmental Protec16 tion Agency shall not promulgate or enforce any regulation 

17 for a period of 1 year, subject to subsection (b). 

18 (b) EXCEPTION.—The Administrator of the Environ19 mental Protection Agency may promulgate or enforce a 

20 regulation during the 1-year period described in subsection 

21 (a) if the Administrator determines that the promulgation 

22 or enforcement of the regulation is necessary for imme23 diate health or safety reasons. 


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1 SEC. 105. REPEAL OF SUNSET ON INCREASED LIMITATIONS 

2 ON SMALL BUSINESS EXPENSING. 

3 (a) IN GENERAL.—Subsection (b)(1) of section 179 

4 of the Internal Revenue Code of 1986, as amended by the 

5 Tax Relief, Unemployment Insurance Reauthorization, 

6 and Job Creation Act of 2010, is amended by striking 

7 ‘‘shall not exceed—’’ and all that follows and inserting 

8 ‘‘shall not exceed $500,000.’’. 

9 (b) REDUCTION IN LIMITATION.—Subsection (b)(2) 

10 of section 179 of such Code, as amended by the Tax Re11 lief, Unemployment Insurance Reauthorization, and Job 

12 Creation Act of 2010, is amended by striking ‘‘exceeds— 

13 ’’ and all that follows and inserting ‘‘exceeds 

14 $2,000,000.’’. 

15 (c) CONFORMING AMENDMENT.—Section 179(b) of 

16 such Code, as amended by the Tax Relief, Unemployment 

17 Insurance Reauthorization, and Job Creation Act of 2010, 

18 is amended by striking paragraph (6). 

19 (d) COMPUTER SOFTWARE.—Section 

20 179(d)(1)(A)(ii) of such Code, as amended by the Tax Re21 lief, Unemployment Insurance Reauthorization, and Job 

22 Creation Act of 2010, is amended by striking ‘‘and before 

23 2013’’. 

24 (e) REVOCATION OF ELECTION.—Section 179(c)(2) 

25 of such Code, as amended by the Tax Relief, UnemployVerDate Mar 15 2010 04:53 Jan 26, 2011 Jkt 099200 PO 00000 Frm 00007 Fmt 6652 Sfmt 6201 E:\BILLS\S12.IS S12

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1 ment Insurance Reauthorization, and Job Creation Act of 

2 2010, is amended to read as follows: 

3 ‘‘(2) REVOCATION OF ELECTION.—Any election 

4 made under this section, and any specification con5 tained in any such election, may be revoked by the 

6 taxpayer with respect to any property, and such rev7 ocation, once made, shall be irrevocable.’’. 

8 (f) EFFECTIVE DATE.—The amendments made by 

9 this section shall apply to taxable years beginning after 

10 December 31, 2011. 

11 SEC. 106. PERMANENT EXTENSION OF RESEARCH CREDIT. 

12 (a) IN GENERAL.—Section 41 of the Internal Rev13 enue Code of 1986 is amended by striking subsection (h). 

14 (b) CONFORMING AMENDMENT.—Paragraph (1) of 

15 section 45C(b) of the Internal Revenue Code of 1986 is 

16 amended by striking subparagraph (D). 

17 (c) EFFECTIVE DATE.—The amendments made by 

18 this section shall apply to taxable years beginning after 

19 December 31, 2010. 

20 TITLE II—ENACTING REAL 

21 MEDICAL LIABILITY REFORM 

22 SEC. 201. ENCOURAGING SPEEDY RESOLUTION OF CLAIMS. 

23 The time for the commencement of a health care law24 suit shall be 3 years after the date of manifestation of 

25 injury or 1 year after the claimant discovers, or through 


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1 the use of reasonable diligence should have discovered, the 

2 injury, whichever occurs first. In no event shall the time 

3 for commencement of a health care lawsuit exceed 3 years 

4 after the date of manifestation of injury unless tolled for 

5 any of the following— 

6 (1) upon proof of fraud; 

7 (2) intentional concealment; or 

8 (3) the presence of a foreign body, which has no 

9 therapeutic or diagnostic purpose or effect, in the 

10 person of the injured person. 

11 Actions by a minor shall be commenced within 3 years 

12 from the date of the alleged manifestation of injury except 

13 that actions by a minor under the full age of 6 years shall 

14 be commenced within 3 years of manifestation of injury 

15 or prior to the minor’s 8th birthday, whichever provides 

16 a longer period. Such time limitation shall be tolled for 

17 minors for any period during which a parent or guardian 

18 and a health care provider or health care organization 

19 have committed fraud or collusion in the failure to bring 

20 an action on behalf of the injured minor. 

21 SEC. 202. COMPENSATING PATIENT INJURY. 

22 (a) UNLIMITED AMOUNT OF DAMAGES FOR ACTUAL

23 ECONOMIC LOSSES IN HEALTH CARE LAWSUITS.—In any 

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1 ant’s recovery of the full amount of the available economic 

2 damages, notwithstanding the limitation in subsection (b). 

3 (b) ADDITIONAL NONECONOMIC DAMAGES.—In any 

4 health care lawsuit, the amount of noneconomic damages, 

5 if available, may be as much as $250,000, regardless of 

6 the number of parties against whom the action is brought 

7 or the number of separate claims or actions brought with 

8 respect to the same injury. 

9 (c) NO DISCOUNT OF AWARD FOR NONECONOMIC

10 DAMAGES.—For purposes of applying the limitation in 

11 subsection (b), future noneconomic damages shall not be 

12 discounted to present value. The jury shall not be in13 formed about the maximum award for noneconomic dam14 ages. An award for noneconomic damages in excess of 

15 $250,000 shall be reduced either before the entry of judg16 ment, or by amendment of the judgment after entry of 

17 judgment, and such reduction shall be made before ac18 counting for any other reduction in damages required by 

19 law. If separate awards are rendered for past and future 

20 noneconomic damages and the combined awards exceed 

21 $250,000, the future noneconomic damages shall be re22 duced first. 

23 (d) FAIR SHARE RULE.—In any health care lawsuit, 

24 each party shall be liable for that party’s several share 

25 of any damages only and not for the share of any other 


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1 person. Each party shall be liable only for the amount of 

2 damages allocated to such party in direct proportion to 

3 such party’s percentage of responsibility. Whenever a 

4 judgment of liability is rendered as to any party, a sepa5 rate judgment shall be rendered against each such party 

6 for the amount allocated to such party. For purposes of 

7 this section, the trier of fact shall determine the propor8 tion of responsibility of each party for the claimant’s 

9 harm. 

10 SEC. 203. MAXIMIZING PATIENT RECOVERY. 

11 (a) COURT SUPERVISION OF SHARE OF DAMAGES

12 ACTUALLY PAID TO CLAIMANTS.—In any health care law13 suit, the court shall supervise the arrangements for pay14 ment of damages to protect against conflicts of interest 

15 that may have the effect of reducing the amount of dam16 ages awarded that are actually paid to claimants. In par17 ticular, in any health care lawsuit in which the attorney 

18 for a party claims a financial stake in the outcome by vir19 tue of a contingent fee, the court shall have the power 

20 to restrict the payment of a claimant’s damage recovery 

21 to such attorney, and to redirect such damages to the 

22 claimant based upon the interests of justice and principles 

23 of equity. In no event shall the total of all contingent fees 

24 for representing all claimants in a health care lawsuit ex25 ceed the following limits: 


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1 (1) 40 percent of the first $50,000 recovered by 

2 the claimant(s). 

(2) 331 3 ⁄3 percent of the next $50,000 recovered 

4 by the claimant(s). 

5 (3) 25 percent of the next $500,000 recovered 

6 by the claimant(s). 

7 (4) 15 percent of any amount by which the re8 covery by the claimant(s) is in excess of $600,000. 

9 (b) APPLICABILITY.—The limitations in this section 

10 shall apply whether the recovery is by judgment, settle11 ment, mediation, arbitration, or any other form of alter12 native dispute resolution. In a health care lawsuit involv13 ing a minor or incompetent person, a court retains the 

14 authority to authorize or approve a fee that is less than 

15 the maximum permitted under this section. The require16 ment for court supervision in the first two sentences of 

17 subsection (a) applies only in civil actions. 

18 SEC. 204. ADDITIONAL HEALTH BENEFITS. 

19 In any health care lawsuit involving injury or wrong20 ful death, any party may introduce evidence of collateral 

21 source benefits. If a party elects to introduce such evi22 dence, any opposing party may introduce evidence of any 

23 amount paid or contributed or reasonably likely to be paid 

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1 fits. No provider of collateral source benefits shall recover 

2 any amount against the claimant or receive any lien or 

3 credit against the claimant’s recovery or be equitably or 

4 legally subrogated to the right of the claimant in a health 

5 care lawsuit involving injury or wrongful death. This sec6 tion shall apply to any health care lawsuit that is settled 

7 as well as a health care lawsuit that is resolved by a fact 

8 finder. This section shall not apply to section 1862(b) (42 

9 U.S.C. 1395y(b)) or section 1902(a)(25) (42 U.S.C. 

10 1396a(a)(25)) of the Social Security Act. 

11 SEC. 205. PUNITIVE DAMAGES. 

12 (a) IN GENERAL.—Punitive damages may, if other13 wise permitted by applicable State or Federal law, be 

14 awarded against any person in a health care lawsuit only 

15 if it is proven by clear and convincing evidence that such 

16 person acted with malicious intent to injure the claimant, 

17 or that such person deliberately failed to avoid unneces18 sary injury that such person knew the claimant was sub19 stantially certain to suffer. In any health care lawsuit 

20 where no judgment for compensatory damages is rendered 

21 against such person, no punitive damages may be awarded 

22 with respect to the claim in such lawsuit. No demand for 

23 punitive damages shall be included in a health care lawsuit 

24 as initially filed. A court may allow a claimant to file an 

25 amended pleading for punitive damages only upon a moVerDate Mar 15 2010 04:53 Jan 26, 2011 Jkt 099200 PO 00000 Frm 00013 Fmt 6652 Sfmt 6201 E:\BILLS\S12.IS S12

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1 tion by the claimant and after a finding by the court, upon 

2 review of supporting and opposing affidavits or after a 

3 hearing, after weighing the evidence, that the claimant has 

4 established by a substantial probability that the claimant 

5 will prevail on the claim for punitive damages. At the re6 quest of any party in a health care lawsuit, the trier of 

7 fact shall consider in a separate proceeding— 

8 (1) whether punitive damages are to be award9 ed and the amount of such award; and 

10 (2) the amount of punitive damages following a 

11 determination of punitive liability. 

12 If a separate proceeding is requested, evidence relevant 

13 only to the claim for punitive damages, as determined by 

14 applicable State law, shall be inadmissible in any pro15 ceeding to determine whether compensatory damages are 

16 to be awarded. 

17 (b) DETERMINING AMOUNT OF PUNITIVE DAM18 AGES.— 

19 (1) FACTORS CONSIDERED.—In determining 

20 the amount of punitive damages, if awarded, in a 

21 health care lawsuit, the trier of fact shall consider 

22 only the following— 

23 (A) the severity of the harm caused by the 

24 conduct of such party; 


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1 (B) the duration of the conduct or any 

2 concealment of it by such party; 

3 (C) the profitability of the conduct to such 

4 party; 

5 (D) the number of products sold or med6 ical procedures rendered for compensation, as 

7 the case may be, by such party, of the kind 

8 causing the harm complained of by the claim9 ant; 

10 (E) any criminal penalties imposed on such 

11 party, as a result of the conduct complained of 

12 by the claimant; and 

13 (F) the amount of any civil fines assessed 

14 against such party as a result of the conduct 

15 complained of by the claimant. 

16 (2) MAXIMUM AWARD.—The amount of punitive 

17 damages, if awarded, in a health care lawsuit may 

18 be as much as $250,000 or as much as two times 

19 the amount of economic damages awarded, which20 ever is greater. The jury shall not be informed of 

21 this limitation. 


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1 SEC. 206. AUTHORIZATION OF PAYMENT OF FUTURE DAM2 AGES TO CLAIMANTS IN HEALTH CARE LAW3 SUITS. 

4 (a) IN GENERAL.—In any health care lawsuit, if an 

5 award of future damages, without reduction to present 

6 value, equaling or exceeding $50,000 is made against a 

7 party with sufficient insurance or other assets to fund a 

8 periodic payment of such a judgment, the court shall, at 

9 the request of any party, enter a judgment ordering that 

10 the future damages be paid by periodic payments. In any 

11 health care lawsuit, the court may be guided by the Uni12 form Periodic Payment of Judgments Act promulgated by 

13 the National Conference of Commissioners on Uniform 

14 State Laws. 

15 (b) APPLICABILITY.—This section applies to all ac16 tions which have not been first set for trial or retrial be17 fore the effective date of this title. 

18 SEC. 207. DEFINITIONS. 

19 In this title: 

20 (1) ALTERNATIVE DISPUTE RESOLUTION SYS21 TEM; ADR.—The term ‘‘alternative dispute resolution 

22 system’’ or ‘‘ADR’’ means a system that provides 

23 for the resolution of health care lawsuits in a man24 ner other than through a civil action brought in a 

25 State or Federal court. 


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1 (2) CLAIMANT.—The term ‘‘claimant’’ means 

2 any person who brings a health care lawsuit, includ3 ing a person who asserts or claims a right to legal 

4 or equitable contribution, indemnity, or subrogation, 

5 arising out of a health care liability claim or action, 

6 and any person on whose behalf such a claim is as7 serted or such an action is brought, whether de8 ceased, incompetent, or a minor. 

9 (3) COLLATERAL SOURCE BENEFITS.—The 

10 term ‘‘collateral source benefits’’ means any amount 

11 paid or reasonably likely to be paid in the future to 

12 or on behalf of the claimant, or any service, product, 

13 or other benefit provided or reasonably likely to be 

14 provided in the future to or on behalf of the claim15 ant, as a result of the injury or wrongful death, pur16 suant to— 

17 (A) any State or Federal health, sickness, 

18 income-disability, accident, or workers’ com19 pensation law; 

20 (B) any health, sickness, income-disability, 

21 or accident insurance that provides health bene22 fits or income-disability coverage; 

23 (C) any contract or agreement of any 

24 group, organization, partnership, or corporation 

25 to provide, pay for, or reimburse the cost of 


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1 medical, hospital, dental, or income-disability 

2 benefits; and 

3 (D) any other publicly or privately funded 

4 program. 

5 (4) COMPENSATORY DAMAGES.—The term 

6 ‘‘compensatory damages’’ means objectively 

7 verifiable monetary losses incurred as a result of the 

8 provision of, use of, or payment for (or failure to 

9 provide, use, or pay for) health care services or med10 ical products, such as past and future medical ex11 penses, loss of past and future earnings, cost of ob12 taining domestic services, loss of employment, and 

13 loss of business or employment opportunities, dam14 ages for physical and emotional pain, suffering, in15 convenience, physical impairment, mental anguish, 

16 disfigurement, loss of enjoyment of life, loss of soci17 ety and companionship, loss of consortium (other 

18 than loss of domestic service), hedonic damages, in19 jury to reputation, and all other nonpecuniary losses 

20 of any kind or nature. The term ‘‘compensatory 

21 damages’’ includes economic damages and non22 economic damages, as such terms are defined in this 

23 section. 

24 (5) CONTINGENT FEE.—The term ‘‘contingent 

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1 sons which is payable only if a recovery is effected 

2 on behalf of one or more claimants. 

3 (6) ECONOMIC DAMAGES.—The term ‘‘economic 

4 damages’’ means objectively verifiable monetary 

5 losses incurred as a result of the provision of, use 

6 of, or payment for (or failure to provide, use, or pay 

7 for) health care services or medical products, such as 

8 past and future medical expenses, loss of past and 

9 future earnings, cost of obtaining domestic services, 

10 loss of employment, and loss of business or employ11 ment opportunities. 

12 (7) HEALTH CARE LAWSUIT.—The term 

13 ‘‘health care lawsuit’’ means any health care liability 

14 claim concerning the provision of health care goods 

15 or services or any medical product affecting inter16 state commerce, or any health care liability action 

17 concerning the provision of health care goods or 

18 services or any medical product affecting interstate 

19 commerce, brought in a State or Federal court or 

20 pursuant to an alternative dispute resolution system, 

21 against a health care provider, a health care organi22 zation, or the manufacturer, distributor, supplier, 

23 marketer, promoter, or seller of a medical product, 

24 regardless of the theory of liability on which the 

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1 tiffs, defendants, or other parties, or the number of 

2 claims or causes of action, in which the claimant al3 leges a health care liability claim. Such term does 

4 not include a claim or action which is based on 

5 criminal liability; which seeks civil fines or penalties 

6 paid to Federal, State, or local government; or which 

7 is grounded in antitrust. 

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 or pursuant 

11 to an alternative dispute resolution system, against 

12 a health care provider, a health care organization, or 

13 the manufacturer, distributor, supplier, marketer, 

14 promoter, or seller of a medical product, regardless 

15 of the theory of liability on which the claim is based, 

16 or the number of plaintiffs, defendants, or other par17 ties, or the number of causes of action, in which the 

18 claimant alleges a health care liability claim. 

19 (9) HEALTH CARE LIABILITY CLAIM.—The 

20 term ‘‘health care liability claim’’ means a demand 

21 by any person, whether or not pursuant to ADR, 

22 against a health care provider, health care organiza23 tion, or the manufacturer, distributor, supplier, mar24 keter, promoter, or seller of a medical product, in25 cluding, but not limited to, third-party claims, crossVerDate Mar 15 2010 04:53 Jan 26, 2011 Jkt 099200 PO 00000 Frm 00020 Fmt 6652 Sfmt 6201 E:\BILLS\S12.IS S12

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1 claims, counter-claims, or contribution claims, which 

2 are based upon the provision of, use of, or payment 

3 for (or the failure to provide, use, or pay for) health 

4 care services or medical products, regardless of the 

5 theory of liability on which the claim is based, or the 

6 number of plaintiffs, defendants, or other parties, or 

7 the number of causes of action. 

8 (10) HEALTH CARE ORGANIZATION.—The term 

9 ‘‘health care organization’’ means any person or en10 tity which is obligated to provide or pay for health 

11 benefits under any health plan, including any person 

12 or entity acting under a contract or arrangement 

13 with a health care organization to provide or admin14 ister any health benefit. 

15 (11) HEALTH CARE PROVIDER.—The term 

16 ‘‘health care provider’’ means any person or entity 

17 required by State or Federal laws or regulations to 

18 be licensed, registered, or certified to provide health 

19 care services, and being either so licensed, reg20 istered, or certified, or exempted from such require21 ment by other statute or regulation. 

22 (12) HEALTH CARE GOODS OR SERVICES.—The 

23 term ‘‘health care goods or services’’ means any 

24 goods or services provided by a health care organiza25 tion, provider, or by any individual working under 


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1 the supervision of a health care provider, that relates 

2 to the diagnosis, prevention, or treatment of any 

3 human disease or impairment, or the assessment or 

4 care of the health of human beings. 

5 (13) MALICIOUS INTENT TO INJURE.—The 

6 term ‘‘malicious intent to injure’’ means inten7 tionally causing or attempting to cause physical in8 jury other than providing health care goods or serv9 ices. 

10 (14) MEDICAL PRODUCT.—The term ‘‘medical 

11 product’’ means a drug, device, or biological product 

12 intended for humans, and the terms ‘‘drug’’, ‘‘de13 vice’’, and ‘‘biological product’’ have the meanings 

14 given such terms in sections 201(g)(1) and 201(h) 

15 of the Federal Food, Drug and Cosmetic Act (21 

16 U.S.C. 321(g)(1) and (h)) and section 351(a) of the 

17 Public Health Service Act (42 U.S.C. 262(a)), re18 spectively, including any component or raw material 

19 used therein, but excluding health care services. 

20 (15) NONECONOMIC DAMAGES.—The term 

21 ‘‘noneconomic damages’’ means damages for phys22 ical and emotional pain, suffering, inconvenience, 

23 physical impairment, mental anguish, disfigurement, 

24 loss of enjoyment of life, loss of society and compan25 ionship, loss of consortium (other than loss of doVerDate Mar 15 2010 04:53 Jan 26, 2011 Jkt 099200 PO 00000 Frm 00022 Fmt 6652 Sfmt 6201 E:\BILLS\S12.IS S12

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1 mestic service), hedonic damages, injury to reputa2 tion, and all other nonpecuniary losses of any kind 

3 or nature. 

4 (16) PUNITIVE DAMAGES.—The term ‘‘punitive 

5 damages’’ means damages awarded, for the purpose 

6 of punishment or deterrence, and not solely for com7 pensatory purposes, against a health care provider, 

8 health care organization, or a manufacturer, dis9 tributor, or supplier of a medical product. Punitive 

10 damages are neither economic nor noneconomic 

11 damages. 

12 (17) RECOVERY.—The term ‘‘recovery’’ means 

13 the net sum recovered after deducting any disburse14 ments or costs incurred in connection with prosecu15 tion or settlement of the claim, including all costs 

16 paid or advanced by any person. Costs of health care 

17 incurred by the plaintiff and the attorneys’ office 

18 overhead costs or charges for legal services are not 

19 deductible disbursements or costs for such purpose. 

20 (18) STATE.—The term ‘‘State’’ means each of 

21 the several States, the District of Columbia, the 

22 Commonwealth of Puerto Rico, the Virgin Islands, 

23 Guam, American Samoa, the Northern Mariana Is24 lands, the Trust Territory of the Pacific Islands, and 


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1 any other territory or possession of the United 

2 States, or any political subdivision thereof. 

3 SEC. 208. EFFECT ON OTHER LAWS. 

4 (a) VACCINE INJURY.— 

5 (1) To the extent that title XXI of the Public 

6 Health Service Act establishes a Federal rule of law 

7 applicable to a civil action brought for a vaccine-re8 lated injury or death— 

9 (A) this title does not affect the application 

10 of the rule of law to such an action; and 

11 (B) any rule of law prescribed by this title 

12 in conflict with a rule of law of such title XXI 

13 shall not apply to such action. 

14 (2) If there is an aspect of a civil action 

15 brought for a vaccine-related injury or death to 

16 which a Federal rule of law under title XXI of the 

17 Public Health Service Act does not apply, then this 

18 title or otherwise applicable law (as determined 

19 under this title) will apply to such aspect of such ac20 tion. 

21 (b) OTHER FEDERAL LAW.—Except as provided in 

22 this section, nothing in this title shall be deemed to affect 

23 any defense available to a defendant in a health care law24 suit or action under any other provision of Federal law. 


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1 SEC. 209. STATE FLEXIBILITY AND PROTECTION OF 

2 STATES’ RIGHTS. 

3 (a) HEALTH CARE LAWSUITS.—The provisions gov4 erning health care lawsuits set forth in this title preempt, 

5 subject to subsections (b) and (c), State law to the extent 

6 that State law prevents the application of any provisions 

7 of law established by or under this title. The provisions 

8 governing health care lawsuits set forth in this title super9 sede chapter 171 of title 28, United States Code, to the 

10 extent that such chapter— 

11 (1) provides for a greater amount of damages 

12 or contingent fees, a longer period in which a health 

13 care lawsuit may be commenced, or a reduced appli14 cability or scope of periodic payment of future dam15 ages, than provided in this title; or 

16 (2) prohibits the introduction of evidence re17 garding collateral source benefits, or mandates or 

18 permits subrogation or a lien on collateral source 

19 benefits. 

20 (b) PROTECTION OF STATES’ RIGHTS AND OTHER

21 LAWS.—(1) Any issue that is not governed by any provi22 sion of law established by or under this title (including 

23 State standards of negligence) shall be governed by other24 wise applicable State or Federal law. 

25 (2) This title shall not preempt or supersede any 

26 State or Federal law that imposes greater procedural or 


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1 substantive protections for health care providers and 

2 health care organizations from liability, loss, or damages 

3 than those provided by this title or create a cause of ac4 tion. 

5 (c) STATE FLEXIBILITY.—No provision of this title 

6 shall be construed to preempt— 

7 (1) any State law (whether effective before, on, 

8 or after the date of the enactment of this Act) that 

9 specifies a particular monetary amount of compen10 satory or punitive damages (or the total amount of 

11 damages) that may be awarded in a health care law12 suit, regardless of whether such monetary amount is 

13 greater or lesser than is provided for under this title, 

14 notwithstanding section 202(a); or 

15 (2) any defense available to a party in a health 

16 care lawsuit under any other provision of State or 

17 Federal law. 

18 SEC. 210. APPLICABILITY; EFFECTIVE DATE. 

19 This title shall apply to any health care lawsuit 

20 brought in a Federal or State court, or subject to an alter21 native dispute resolution system, that is initiated on or 

22 after the date of the enactment of this Act, except that 

23 any health care lawsuit arising from an injury occurring 

24 prior to the date of the enactment of this Act shall be 


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1 governed by the applicable statute of limitations provisions 

2 in effect at the time the injury occurred. 

Æ 


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