I
103D CONGRESS
2D SESSION
H. R. 5253
To establish standards relating to the calculation and payment of damages
in medical malpractice liability claims and actions, to restrict attorneys’
contingency fees under such claims and actions, and for other purposes.
IN THE HOUSE OF REPRESENTATIVES
OCTOBER 7, 1994
Mr. BALLENGER introduced the following bill; which was referred to the
Committee on the Judiciary
A BILL
To establish standards relating to the calculation and pay-
ment of damages in medical malpractice liability claims
and actions, to restrict attorneys’ contingency fees under
such claims and actions, and for other purposes.
Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled,
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 MED-
ICAL MALPRACTICE CLAIMS AND ACTIONS.
(a) LIMITATION ON NONECONOMIC DAMAGES.—The
total amount of noneconomic damages that may be award-
ed 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 com-
pensate 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 ac-
tion; 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 mal-
practice liability claim or action in which future eco-
nomic 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 dam-
ages are found likely to occur, as such payments are
determined by the court.
(2) WAIVER.—A court may waive the applica-
tion of paragraph (1) with respect to a defendant if
the court determines that it is not in the best inter-
ests 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 MAL-
PRACTICE CLAIMS.
(a) IN GENERAL.—An attorney who represents, on
a contingency fee basis, a claimant in a medical mal-
practice 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 judg-
ment 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 re-
spect 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 inconsist-
ent 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 re-
spect 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 im-
munity asserted by any State under any provision of
law;
(2) waive or affect any defense of sovereign im-
munity 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 re-
spect to claims brought by a foreign nation or a citi-
zen 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 ESTAB-
LISHED 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 liabil-
ity 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 es-
tate.
(2) ECONOMIC DAMAGES.—The term ‘‘economic
damages’’ means damages paid to compensate an in-
dividual 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 cer-
tified by the State to engage in the delivery of such
services in the State.
(5) INJURY.—The term ‘‘injury’’ means any ill-
ness, disease, or other harm that is the subject of
a medical malpractice liability action or a medical
malpractice liability claim.
(6) MEDICAL
MALPRACTICE
LIABILITY
AC-
TION.—The term ‘‘medical malpractice liability ac-
tion’’ means a civil action brought in a State or Fed-
eral court against a health care provider or health
care professional in which the plaintiff alleges a
medical malpractice liability claim, but does not in-
clude any action in which the plaintiff’s sole allega-
tion 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 Cos-
metic Act (21 U.S.C. 321(g)(1)) or a medical
device (as defined in section 201(h) of the Fed-
eral 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 per-
formance of the aspect of such drug or de-
vice which is the subject of the claimant’s
allegation or the adequacy of the packag-
ing 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 rec-
ognized as safe and effective under regula-
tions 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
MISREPRE-
SENTATION OR FRAUD.—Notwithstanding sub-
paragraph (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 Ad-
ministration for marketing as a result of with-
held information, misrepresentation, or an ille-
gal payment by manufacturer of the product.
(9) NONECONOMIC DAMAGES.—The term ‘‘non-
economic damages’’ means damages paid to com-
pensate 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 com-
pensation for actual harm suffered, that is awarded
for the purpose of punishing a person for conduct
deemed to be malicious, wanton, willful, or exces-
sively 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.
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