MINUTES OF THE ASSEMBLY COMMITTEE ON JUDICIARY Sixty-eighth Session May 25, 1995 The Committee on Judiciary was called to order at 8:09 a.m., on Thursday, May 25, 1995, Chairman Humke presiding in Room 119 of the Legislative Building, Carson City, Nevada. Exhibit A is the Agenda. Exhibit B is the Attendance Roster. COMMITTEE MEMBERS PRESENT: Mr. Bernie Anderson, Chairman Mr. David E. Humke, Chairman Ms. Barbara E. Buckley, Vice Chairman Mr. Brian Sandoval, Vice Chairman Mr. Thomas Batten Mr. John C. Carpenter Mr. David Goldwater Mr. Mark Manendo Mrs. Jan Monaghan Ms. Genie Ohrenschall Mr. Richard Perkins Mr. Michael A. (Mike) Schneider Ms. Dianne Steel Ms. Jeannine Stroth GUEST LEGISLATORS PRESENT: Assemblywoman Sandi Krenzer Lieutenant Governor, Lonnie L. Hammargren Assemblyman John Marvel STAFF MEMBERS PRESENT: Dennis Neilander, Research Analyst Joi Davis, Committee Secretary OTHERS PRESENT: Robert Bennett, Executive Director, Nevada Coalition Allied for Patient Protection Charles F. McCuskey, Jr., M.D. Frank J. Nemec, M.D. Larry Matheis, Nevada State Medical Association Phil Stout, Nevada Association of Independent Business Rex Mabey, Jr., M.D. William S. Bossak, M.D. Bill Prezant, Esq. Jim Galloway, citizen and private business owner Robert Byrd, President, Nevada Medical Liability Insurance Company B.D.R. R-2047 A resolution which urges Congress to require application for passports for child to be signed by both parents under certain circumstances. ASSEMBLYMAN ANDERSON MOVED FOR COMMITTEE INTRODUCTION OF B.D.R. R-2047. ASSEMBLYMAN STEEL SECONDED THE MOTION. THE MOTION CARRIED. ASSEMBLYMEN STROTH, SANDOVAL, PERKINS, AND SCHNEIDER WERE NOT PRESENT FOR THE VOTE. * * * * * B.D.R. 14-533 Prohibits certain appeals in criminal actions if defendant pleads guilty or nolo contendere. ASSEMBLYMAN ANDERSON MOVED FOR COMMITTEE INTRODUCTION OF B.D.R. 14-533. ASSEMBLYMAN OHRENSCHALL SECONDED THE MOTION. THE MOTION CARRIED. ASSEMBLYMEN STROTH, SANDOVAL, PERKINS, AND SCHNEIDER WERE NOT PRESENT FOR THE VOTE. Chairman Humke announced there was a citizen present in Las Vegas that wished to listen to the proceedings so the telephone equipment has been activated to provide audio transmission of the hearing to Las Vegas. In addition, Chairman Humke announced they would proceed to hear from the proponents of Assembly Bill 520 and one-half hour commencing at 10:30 a.m. has been set aside to hear Assembly Bill 180. Mr. Goldwater disclosed his only source of income is as a result of employment by a group of doctors. Due to that fact, he has a pecuniary interest in the topic of medical malpractice and will be unable to vote on Assembly Bill 520 or any other bills concerning medical malpractice. However, he concluded he could participate in discussions on the subject. Ms. Buckley disclosed she is a licensed attorney in the state of Nevada and she will not be affected by this legislation any differently than any other lawyer so she will be voting. Ms. Steel concurred with Ms. Buckley. Ms. Ohrenschall stated she was a member of the State Bar of Nevada but not presently in active practice of law. Mr. Humke made the same disclosure of Ms. Buckley and noted Mr. Sandoval would more than likely make the same disclosure however he was currently testifying in another committee. Mrs. Monaghan disclosed she was a licensed, registered nurse and this legislation would not affect her any differently than anyone else. ASSEMBLY BILL 520 - Makes various changes to provisions relating to actions for medical malpractice. Mr. Rick Bennett, Executive Director of the Nevada Coalition Allied for Patient Protection (NEVCAP) stated NEVCAP is a coalition that includes physicians, other health care professionals, health facilities, and liability insurers. These individuals have come together in bringing A.B. 520 because of the staggering increases in costs related to lawsuit abuse. Mr. Bennett set forth the goals of NEVCAP for the committee and outlined the presentation of testimony today. Mr. Bennett's prepared statement in this regard is attached hereto as (Exhibit C). Mr. Bennett introduced the persons to testify with him as Dr. Charles McCuskey, M.D., a Washoe County physician, Chairman to NEVCAP, and the immediate past president of the Nevada State Medical Association, Dr. Frank Nemec, a Clark County physician and president of the Nevada State Medical Association, and Lawrence Matheis, Executive Director of the Nevada State Medical Association. Mr. Bennett requested the committee withhold questions until after their presentation. Chairman Humke agreed to do the same. Dr. Charles F. McCuskey, M.D., stated he recently retired from full time practice of orthopaedic surgery in Reno. During the 30 years he was in private practice his medical liability insurance premiums increased from $400 per year to over $40,000 per year last year. Dr. McCuskey stated the rise in insurance costs and the stress of facing unnecessary litigation encouraged him to retire. Dr. McCuskey asserted that physicians are becoming increasingly aware that their patients are potential litigants and patients are encouraged, through lawyer advertising, to view every encounter with the health care system as a potential lawsuit. Dr. McCuskey informed the committee there are three primary insurance carriers providing coverage for Nevada's doctors. They are The Doctor's Company (insuring over 1200 physicians) Nevada Medical Liability Insurance Company (insuring over 600 physicians), and Medical Insurance Exchange of California (insuring over 200 physicians). Dr. McCuskey relayed the history of the premium rates for these three companies during 1986 to 1994. Said statistical data is included in Dr. McCuskey's prepared testimony attached hereto as (Exhibit D). The statistics provided indicate substantial increases overall. The Insurance Commissioner attributes the increases to several factors: 1) growth in the number of claims; and 2) increased cost of settlement. Dr. McCuskey compared what is occurring now with Nevada's increased rates to what occurred in the same magnitude in the state of California in the mid-70s. California addressed those concerns and now their rates are approximately half of what Nevada physicians are paying in medical malpractice premiums. Dr. McCuskey expounded on a provision in A.B. 520 addressing the care provided by obstetricians--seeing this as the most affected area of practice surrounding medical malpractice rate increases. The recommendation in A.B. 520 is to treat the pregnant woman arriving for delivery of her baby at the emergency room, as an emergency in light of the "Good Samaritan Act." Dr. McCuskey commented on the adoption of the Medical Legal Screening Panel (MLSP) in Nevada during the 1986 legislation. Although the MLSP has been successful, that success has been limited. The goals of the MLSP are: 1) screen out frivolous claims of medical malpractice; 2) stimulate quicker settlements where malpractice has occurred; and 3) to reduce costs. Dr. McCuskey expounded further on the successes and necessary improvements of the MLSP as set forth in his prepared text (Exhibit D) as well as the procedures of the panel. He also pointed out the binder provided to the committee contained, in addition to other items, information on the MLSP. The binder prepared by NEVCAP is attached hereto as (Exhibit E). Dr. McCuskey continued his testimony stating there were 953 claims of medical malpractice brought to the State Insurance Department between 1986 and January, 1995. There has been a 60% increase in annual filings since 1988. Various statistical data was provided by way of charts and graphs contained in the NEVCAP binder (Exhibit E) and was presented in large chart form for the committee at the time of hearing. Dr. McCuskey's prepared testimony also included comments pertaining to the need for an increase in the number of panel members, disallowing the addition of respondents to litigation that have not gone through the MLSP process, and other reforms he sees necessary as clearly set forth in A.B. 520. Dr. McCuskey concluded by urging the committee to support passage of the bill. Dr. Frank Nemec, President, Nevada State Medical Association (NSMA), and Gastroenterologist in private practice in Las Vegas, testified in support of A.B. 520. Dr. Nemec declared Forbes magazine recently documented Nevada as the 5th most litigious state in the nation. Further, Nevada ranks No. 44 in the nation in its ratio of physicians per 100,000 population and No. 2 in the nation in trial lawyers per 100,000. Dr. Nemec stated the MLSP makes written findings which can result in one of the following: 1) both parties settle on a dollar amount and the case ends; 2) if the defense rejects settlement, the case proceeds to district court and if there is a finding for the plaintiff equal or greater than that proposed at settlement, the defense is liable for the plaintiff's legal costs as well as the award; or 3) if the plaintiff rejects settlement, the case proceeds to district court and if there is a finding for the defendant equal or greater than that proposed at settlement, the defense is liable for the plaintiff's legal costs as well as the award. Dr. Nemec's prepared testimony is attached hereto as (Exhibit F) and included reference to charts contained in (Exhibit E). Dr. Nemec declared The Doctor's Company reported it paid out an average settlement in 1985-1987 of $22,265 which has grown to the average settlement of $66,754 for 1992-1994. Nevada Medical Liability Insurance Company (NMLIC) reported the average settlement paid out in 1985-1987 was $64,349 and grew to $136,430 in 1992-1994. The Medical Insurance Exchange of California (MIEC) reported its average claim paid in 1986-1988 was under $300,000 which grew to over $6,000,000 in 1992-1994. In viewing a chart presented in the committee and further contained in (Exhibit E) hereto, Dr. Nemec demonstrated the cost of malpractice insurance premiums statewide show Nevada's average premium was $39,536 in 1994 with the only states ranking higher than Nevada being Florida, New York, and Michigan. The lowest state was Arkansas and California, after its major reform in 1975, shows an average premium payment of $23,069 in 1994. Dr. Nemec's testimony included discussion about the limits of "non-economic damages" and "sliding schedule" applied to attorney contingent fees, and the elimination of the "collateral source rule" and "joint and several liability rule" exemption as being the major areas of contention in A.B. 520. Dr. Nemec concluded his testimony by stating he does not see A.B. 520 as a radical proposal and the same has been adopted in one way or another in at least 20 other states. Rather, the reforms set forth in A.B. 520 are designed to assure fair compensation to injured patients, discourage unnecessary litigation and control the cost impact to health care. Larry Matheis, Nevada State Medical Association, proceeded by going through the bill section by section. He stated Section 1 of the bill addresses the issue of joint and several liability. Several years ago the Legislature reformed the rules slightly where there was comparative negligence when the plaintiff shared some part of the responsibility of their injury. The amount of the award depended on what role the plaintiff played in their injury. The change in Section 1 simply applies the logic the Legislature has already adopted regarding comparative negligence and applying responsibility in the amount of payment made by the defendant thereby eliminating the "deep pockets." Section 2 deals with the problem relating to obstetrical services. In those cases where a woman presents herself to a hospital at time of delivery, the physician on duty has not been a part of the woman's prenatal care, it should be treated as an emergency service, incorporating the "Good Samaritan Rule" already in place. Section 3 deals with contingent fees by setting up a sliding fee scale in subsection 2. Section 4 addresses issues involving problems with the MLSP. Section 5 provides for an increase in panel members. Section 6 requires all medical claims be accompanied with a valid medical opinion. In addition, this section sets forth training of panel members and provides for the allowance of a supplementary response filing before the MLSP for those instances when new subject matter has been brought in the complaint. Section 7 addresses the confidentiality of divulging the names of individual panel members of the MLSP prior to a panel hearing. Section 8 would disallow the complainant to add another name to a lawsuit who has not previously gone through the panel process. Section 9 changes the statute of limitations from four to three years after date of injury, and two to one year after date of discovery of the injury. Mr. Matheis stated this proposition is the same as the tort reform made in the state of California 20 years ago and is more the standard throughout the nation. Section 10 is the punitive damage section. Mr. Matheis stated there are very rare cases when medical malpractice cases result in punitive damages. But when those instances arise, they believe the punitive damage award should not be a "windfall" to the plaintiff but rather it is a social issue and the award should go to the state Medicaid fund. Section 11 limits non-economic damages to $250,000.00. Section 11 additionally moves to delete the collateral source rule so there are no additional payments once a payment has been made. Rick Bennett, Executive Director, NEVCAP, concluded the presentation from NEVCAP by stating A.B. 520 is a reasonable solution to a serious problem. Mr. Bennett reiterated the California tort reform performed in 1975 is model legislation in this regard. Mr. Bennett addressed the views and comments made by the opposition to A.B. 520, specifically, the Nevada Trial Lawyers Association. Mr. Bennett's prepared testimony in this regard is attached hereto as (Exhibit G). Mr. Manendo stated the concerns of his constituents is that A.B. 520 may take away the responsibility of the wrongdoer. In addition, constituents are concerned with the high cost of medical care. How will A.B. 520 directly affect the cost of health care? Mr. Manendo also asked when the last excessive jury verdict was in the state of Nevada. Mr. Bennett replied there are a number of factors involved in the cost of medical care. One factor is medical liability insurance. Making changes in medical liability costs, by itself, will not stop the increase in health care costs but it will be a factor in decreasing the rate in which the costs are increasing. Larry Matheis, Nevada State Medical Association, added the Medicare recipients' cost will go down. There is a formula that determines the amounts charged out for Medicare. The federal government, in adjusting this formula every year, considers the liability premium component of physicians' costs. Dr. Frank Nemec added, with regard to decreased costs, the real savings comes with decreasing the cost of defensive medicine. In addition, if society would return from a legal standard back to a medical standard then the history and physical could be utilized to better determine patients needing additional services which now are performed routinely in "defensive medicine." Dr. Nemec stated it is the Board of Examiners who determines if a doctor should have his license removed, not the Nevada Trial Lawyers in a tort action. In responding to Mr. Manendo's question regarding excessive jury verdicts in this state, Rex Mabey, M.D., stated approximately two weeks ago there was a 2.4 million dollar award against a pediatrician found guilty of malpractice. This physician informed him the MLSP found no malpractice but the plaintiffs sued anyway. Mrs. Monaghan asked, with regard to Section 7(5), what is the intent behind not releasing the names of the panel members? Dr. Nemec stated the problem with releasing the names of the members before the panel hearing is that the people sitting on the panel feel pressure by their colleagues. Mrs. Monaghan noted the language in the bill does not specify "prior to the hearing." Additionally, with regard to the screening panel, persons are removed from the panel from time to time and what is the process in doing so? Dr. Nemec stated he did not know. Mr. Matheis stated the names are submitted to the insurance division annually and they are then rotated around. He believes there is a commitment with the insurance division to let them know if there are names on the list that should be removed or are not being utilized. Chairman Humke announced the committee would not be taking a break and additionally, members of the committee from time to time may have to leave the hearing to testify on other bills in other committees. Chairman Humke further announced the co-chairmen have received written proposed amendments from the Department of Business and Industry Division of Insurance amending Chapter 41A; however, that would not be under consideration today since there were citizens present and their testimony is important to obtain while the persons from state agencies are being paid to be here and can return on another day. Mr. Anderson asked, with regard to lump sum payments, if the person receiving the lump sum award dies, will their lump sum go to their estate? Robert Byrd, President of MNL Insurance Company, stated the periodic payments are normally structured in such a way that they will pay for a minimum period of time such as ten years certain. So, if a plaintiff dies during that ten years, the money would still pay someone, normally the estate, at least for that period of time, whatever is designated. Mr. Anderson asked if other states that have enacted the same policy regarding lump sum payments as set forth in A.B. 520 were generally seen as larger, smaller, or the same. Mr. Byrd stated the total payment tends to be larger under a structured settlement or periodic payment scheme because you can buy an annuity for a lower amount but the plaintiff receives more. Mr. Bennett added in the prepared materials (the NEVCAP binder) there is a section on periodic payments included therein. Mr. Anderson asked Dr. McCuskey if the physician always listened to the advice of the insurance company in deciding whether to settle or litigate? Dr. McCuskey stated the way insurance policies are currently written, the physician is obligated to do whatever the insurance company suggests. However, years ago the physician may have had the option to refuse to settle or litigate. Mr. Anderson asked if there were any cases where the physician would have preferred to abide by the MLSP decision but the insurance company preferred to go to court. Dr. McCuskey replied there probably are such cases however he was unaware of any. Bill Prezant, attorney at law, representing The Doctors Company, testified The Doctors Company, insuring approximately 1,200 physicians in Nevada, provides that in each contract of insurance, the consent of the physician is required before a settlement can be made. Mr. Carpenter asked how many such cases there were of women showing up at the hospital about to give birth. Dr. Nemec stated he did not have that information. Mr. Carpenter asked additionally about the exclusion of retired physicians from malpractice and how many such cases were there on that. Dr. Nemec replied this provision has to do with perception and he does not have any exact figures on the number of cases involved. Mr. Carpenter stated he would like to see some real life figures rather than deal with a perception. Mr. Bennett stated he would provide Mr. Carpenter with some figures. Mr. Matheis stated there was an obstetrician in the audience that perhaps could comment further. Dr. William S. Bossak, an obstetrician from Las Vegas, stated the drop-in pregnant ladies who arrive at the hospital present a very unique situation. A great deal of what goes on in the outcome of the pregnancy is determined by what goes on before the delivery. If there is a bad outcome, the only person the mother can turn to is the physician, regardless if she has had no prenatal care or has been doing drugs. Mr. Carpenter asked how many cases there were where the pain and suffering award was over $250,000.00. Mr. Bennett stated, in speaking to one insurance carrier recently, 6% were over $250,000.00. Mr. Carpenter inquired how much would the medical malpractice premiums be reduced if the $250,000 cap were in effect? Dr. Nemec replied his best estimate is there would be a 28-30% reduction in premiums and that would be reduced further with the implementation of the other remedies proposed in A.B. 520. Mr. Bennett stated the NEVCAP binder also contained some statistics in this regard. Upon Mr. Carpenter's additional comments, a discussion was held regarding "policing" professions within regulatory boards and the revocation of medical licenses. Mr. Nemec stated he would provide additional information addressing Mr. Carpenter's concerns. Ms. Buckley asked how many physician visits of patients there is on an average in a year. In clarifying, Ms. Buckley restated, according to the handouts, there were 144 malpractice actions filed in 1994 with the MLSP. How does that compare to how many actual visits there were by patients to physicians in the state of Nevada during this time. Dr. Nemec stated it would be difficult to determine and it varies according to area of speciality; however, on the average a physician has 20 patient encounters per day--100 per week and there are 2,200 licensed physicians in Nevada. Dr. Bossak calculated this would result in 5% physicians having a lawsuit against them. Upon Ms. Buckley's inquiry, Dr. Nemec stated he would obtain figures for the jury verdicts in Nevada over the past five years with a finding of medical malpractice, how many had awards for non-economic damages exceeding $250,000.00. Ms. Buckley addressed the handout material which provided information on average settlements. The Doctors Company indicates their average settlement at $66,000 whereas MIEC indicated their average settlement was $6,000,000.00. Why such a vast disparity? Dr. Nemec stated he believed the disparity was a result of the smaller amount of physicians that are insured by MIEC. Mr. Bennett stated the information came directly from MIEC and he would provide Ms. Buckley with additional information on that subject. Mr. Sandoval acknowledged A.B. 520 was patterned after California's tort reform laws (MICRA) and the California Supreme Court has upheld that statute as constitutional. However, his research indicates there are a number of states that have found caps on non-economic damages unconstitutional on the grounds that it is a special law, arbitrary, and a violation of equal protection. Mr. Sandoval asked if they had conducted any research in this regard. Mr. Bennett stated the bill was drafted with use of legal counsel and they feel it will be constitutionally recognized in the state of Nevada. Mr. Sandoval asked if the provision eliminating joint and several liability is not only for medical malpractice cases but also within the entire civil justice system. Mr. Bennett stated yes it is. Mr. Sandoval asked why they were seeking to eliminate joint and several liability in all other civil cases. Mr. Matheis stated they were seeking to expand it beyond just comparative negligence. When this subject was reviewed, they did not see any reason why the fairness issue should not apply across the board. Mr. Sandoval, in addressing Section 8(4), this provision prohibits a party who is not named at the MLSP from being added as a party in a subsequent civil action, did they see that as an increase in litigation as there would be two separate lawsuits on the same incident? Dr. Nemec stated the motivation in that Section was that the process set out should apply to all physicians. Mr. Schneider pointed out that most business people are required to maintain errors and omission insurance as part of the cost of doing business. In other words, there is a cost relationship so you have to perform a certain dollar volume of business to make it worthwhile to be in business. With A.B. 520, Mr. Schneider asked if the cost of medical malpractice insurance premiums were lowered, how would it benefit the people and how does it affect how doctors practice "defensive medicine" in Nevada? Dr. McCuskey responded the doctors' fees for services provided are fixed between Medicare, SIIS, and the HMO's so it will probably take awhile before you see the average practicing doctor drop his fees. Secondly, it will take time for some of the defensive medicine costs to go down also. Dr. Nemec stated the pressure for doctors to decrease their costs is tremendous and he does not see there being an immediate decrease in costs if the malpractice premium is reduced. Both Dr. McCuskey and Dr. Nemec elaborated further regarding the use of defensive medicine techniques because of the legal climate. Dr. Rex Mabey stated he is an obstetrician and he currently pays $50,000 per year. He added if the rates continue to increase there will be a problem with access to the public. He stated their rates cannot go up because they are set by the managed care companies so if malpractice costs continue to rise, some obstetricians will simply quit their practice. Additionally, the Medicaid patients will be hurt the most because there will be limited physicians available to care for them. Ms. Steel recalled earlier testimony wherein periodic payments were necessary in order to assure the victim sees more money than the lawyer. However, how does that philosophy comport with their intent to set caps on economic damage and eliminate joint and several liability which are social policies now perceived by the state of Nevada? Currently, the "deep pocket" seeks remedy from other culpable parties. Why force the victim to go after the other culpable party? Dr. Nemec replied one of the consequences of having joint and several liability is the motivation of care providers having coverage to compensate persons who have been harmed by acts of negligence. If physicians had assurances patients would go after the "deep pockets" then it would be easy not to carry insurance and just rely on the hospitals to provide that compensation. Therefore, he sees no argument in Ms. Steel's comments. In responding to Ms. Steel's concerns, Dr. William Bossak commented on a Sunday, May 14, 1995 article in the Review-Journal about tort reform by a trial attorney. Apparently, in the article it was stated there were 36,000 lawsuits for one million Clark County residents from 1992 to 1994. He further relayed statistics on the amount of awards in these cases. Dr. Bossak stated there was a great incentive on the part of attorneys to sue people and in fact this is a big business for attorneys. Dr. Bossak pointed out in the Las Vegas telephone alone there is 103 pages devoted to attorneys some with full page color ads costing $4,700 per month--over $50,000 per year. Dr. Bossak continued to expound on his view of attorneys being the direct result of the rise in malpractice premiums. ASSEMBLY BILL 180 - Makes various changes concerning tort actions. Assemblyman John Marvel, District 34, the primary sponsor of A.B. 180, deferred explanation of the bill to Dennis Neilander, Senior Research Analyst, who he worked closely with on drafting this legislation. Mr. Marvel stated his interest in the bill was due to his close association in the Prison industry and the product liability aspect. Lastly, Mr. Marvel referred the committee to a paper prepared by the LCB on tort reform. Dennis Neilander, Senior Research Analyst, stated he was asked to summarize A.B. 180 by Assemblyman Marvel, however, he is not for or against the bill. First of all, A.B. 180 differs from A.B. 520 in that it applies to personal injury and wrongful death actions not just medical malpractice. Mr. Neilander stated the first substantive change occurs at Section 2 which places a cap for non-economic damages and requires the jury not be instructed as to the existence of the cap. Section 3 provides for periodic payments and also has an estate provision as a result of the death of a plaintiff. Section 4 limits attorneys' fees by establishing a sliding scale. Section 5 establishes a statute of limitations for a product liability which is six years from the date of purchase or 10 years after the date of manufacture, whichever is later. Section 6 of the bill amends the collateral source rule which allows the jury to receive testimony concerning the existence of collateral sources but does not provide a mandatory offset. Ms. Ohrenschall asked if the statute of limitations provision in Section 2(a) referring to six years after the date of the "initial purchase" refers to the initial purchase by the person injured. Mr. Neilander stated this provision was taken from model legislation produced by a manufacturing group and he believed it was from the original purchase rather than the re-purchase. James Galloway, private citizen and owner of a small business, Galloway, Inc., Reno, Nevada, stated he has experience in products liability cases as his company produces an aerial tower as a safety device to go up on high places which has been the subject of litigation. He supports A.B. 180 entirely and provided specific testimony regarding various litigation to which he has knowledge. Mr. Galloway's prepared text is attached hereto as (Exhibit H). Mr. David Howard, Greater Reno-Sparks Chamber of Commerce, waived testimony due to the lateness of the hour. However, Mr. Howard provided the committee with a handout of materials which is attached hereto as (Exhibit I). Phil Stout, Executive Director, Nevada Association of Independent Businesses stated with regard to A.B. 180 and A.B. 520 they support both bills in efforts towards tort reform in hopes of reducing the costs of liability of insurance for medical costs and for insurance for businesses. They do not support all portions of the bills; however, in that some of their clients are attorneys and they have a right to earn a living. Contingency fees are negotiated between attorneys and their clients which is a fair practice in the free enterprise system. Therefore, that section should be eliminated. However, they agree with the remainder of the bill. There being no further business before the committee, the hearing was adjourned at 11:02 a.m. RESPECTFULLY SUBMITTED: _______________________________ Joi Davis, Committee Secretary APPROVED BY: _______________________________________ Assemblyman Bernie Anderson, Chairman _______________________________________ Assemblyman David E. Humke, Chairman Assembly Committee on Judiciary May 25, 1995 Page