Doctors, Lawyers and the Controversial Prop 46

Business & Environmental Transactions & Litigation
by Stephen T. Holzer
818.907.3299

What’s the most controversial measure on California’s November ballot? The insurance regulation bill, Prop 45, may be a good contender – but more than likely the controversy over Proposition 46 will win the contest hands down. But can it win votes as well?

Before we can guess, let’s look at all that Prop 46 strives to accomplish:

1. Raise California’s cap on damages for medical malpractice (MedMal) suits to $1 million – currently the cap is $250 thousand.
2. Requires doctors to undergo drug and alcohol testing. Positive test results will be reported to the California Medical Board (Board).
3. Requires the Board to suspend doctors who test positive for drugs or alcohol pending an investigation. The Board will be required to discipline those doctors found to be working while under the influence.
4. Health care practitioners will be required to report doctors they suspect of being on duty while impaired, or who otherwise perform duties negligently.
5. Requires medical practitioners to consult a state prescription database before prescribing some controlled substances.

­­Prop 46 Background

When Jerry Brown served as governor of California the first time, he signed the Medical Injury Compensation Reform Act (MICRA), in 1975. The act capped noneconomic pain and suffering damages for MedMal suits at $250 thousand. If we adjust the cap for inflation since 1975, the figure should roughly total $1.1 million this year.

Arguments For and Against Prop 46

Here are the groups opposing and supporting the measure, and some of their primary reasons for the stances they’ve taken.

The Prop 46 opposition gets full backing from numerous health professional organizations, including the: California Medical Association, California Dental Association and American Medical Association. Then add strong union backing from the International Brotherhood of Electrical Workers (IBEW) and Service Employees International Union (SEIU).

Finally, count the political heavies like the California Republican Party, the American Civil Liberties Union of California, the California NAACP – and you find some intimidating opposition to Prop 46.

The arguments against the ballot measure are as varied as the goals Prop 46 tries to achieve. Opponents say:

1. Bigger awards for malpractice suits means the doctors and insurance companies will defer those costs to the consumer – potentially hundreds of millions each year.
2. A prescription database threatens consumer privacy. The government can’t implement or maintain it, let alone protect it from hackers.
3. You could lose your doctor – if the medical liability cap increases, your doctor may be forced to leave California to practice elsewhere, or reduce/eliminate services.

Prop 46 supporters include: Consumer Watchdog, consumer advocate Erin Brokovich; the founder of Mothers Against Drunk Driving Candace Lightner; Senator Barbara Boxer, House Democratic Leader Nancy Pelosi, the State Insurance Commissioner Dave Jones, various democratic party leaders and patient safety advocates. Those behind the measure say:

1. Indexing the damages cap for inflation won’t raise health care costs, as those awards account for a very small percentage of the costs of healthcare. Additionally, insurance companies earned a 6.5 percent return on net worth in the last decade, while MedMal insurers earned a 16.7 percent return.
2. Medical negligence is the third leading cause of death after heart disease and cancer, and about 18 percent of doctors suffer from drug and/or alcohol abuse at some time in their careers.
3. A prescription drug database is already in place, the Controlled Substance Utilization Review and Evaluation System, or CURES was established in 1997, and went digital five years ago. Additionally, 48 other states across the nation already have a prescription drug monitoring program in use.

A Field Poll initiated in June reported 58 percent of respondents supported Prop 46, but in August poll numbers dropped to 34 percent. Whether you agree or disagree with the intended goals or this ballot measure, the controversy will keep the campaign interesting.

Stephen T. Holzer is an Environmental and Business Litigation Attorney. Contact him via email: sholzer@lewitthackman.com , or by phone: 818.907.3299

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