Senate Bill No. 97–Committee on Judiciary

 

February 12, 2003

____________

 

Referred to Committee on Judiciary

 

SUMMARY—Makes various changes relating to certain actions against providers of health care. (BDR 1‑248)

 

FISCAL NOTE:  Effect on Local Government: No.

                           Effect on the State: No.

 

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EXPLANATION – Matter in bolded italics is new; matter between brackets [omitted material] is material to be omitted.

 

AN ACT relating to malpractice; limiting attorney’s fees in certain actions against providers of health care; revising the limitation on the amount of noneconomic damages that may be awarded in such actions; providing for several liability for economic and noneconomic damages in such actions; revising the statute of limitations for the filing of such actions; making various changes concerning the payment of damages in such actions; and providing other matters properly relating thereto.

 

    Whereas, There exists a major health care crisis in this state attributable to the skyrocketing cost of medical malpractice insurance; and

    Whereas, Such skyrocketing medical malpractice insurance costs have resulted in a potential breakdown in the delivery of health care in this state, severe hardships concerning the availability of health care for the medically indigent, a denial of access to health care for the economically marginal, and the depletion of physicians such as to substantially worsen the quality of health care available to the residents of this state; and

    Whereas, It is necessary to provide an adequate and reasonable remedy to address this health care crisis and to protect the health, welfare and safety of the residents of this state; now, therefore,

 

THE PEOPLE OF THE STATE OF NEVADA, REPRESENTED IN

SENATE AND ASSEMBLY, DO ENACT AS FOLLOWS:

2-1  Section 1. Chapter 7 of NRS is hereby amended by adding

2-2  thereto a new section to read as follows:

2-3  1.  An attorney shall not contract for or collect a fee

2-4  contingent on the amount of recovery for representing a person

2-5  seeking damages in connection with an action for injury or death

2-6  against a provider of health care based upon professional

2-7  negligence in excess of:

2-8  (a) Forty percent of the first $50,000 recovered;

2-9  (b) Thirty-three and one-third percent of the next $50,000

2-10  recovered;

2-11      (c) Twenty-five percent of the next $500,000 recovered; and

2-12      (d) Fifteen percent of the amount of recovery that exceeds

2-13  $600,000.

2-14      2.  The limitations set forth in subsection 1 apply to all forms

2-15  of recovery, including, without limitation, settlement, arbitration

2-16  and judgment.

2-17      3.  For the purposes of this section, “recovered” means the net

2-18  sum recovered by the plaintiff after deducting any disbursements

2-19  or costs incurred in connection with the prosecution or settlement

2-20  of the claim. Costs of medical care incurred by the plaintiff and

2-21  general and administrative expenses incurred by the office of the

2-22  attorney are not deductible disbursements or costs.

2-23      4.  As used in this section:

2-24      (a) “Professional negligence” means a negligent act or

2-25  omission to act by a provider of health care in the rendering of

2-26  professional services, which act or omission is the proximate cause

2-27  of a personal injury or wrongful death. The term does not include

2-28  services that are outside the scope of services for which the

2-29  provider of health care is licensed or services for which any

2-30  restriction has been imposed by the applicable regulatory board or

2-31  health care facility.

2-32      (b) “Provider of health care” means a physician licensed

2-33  under chapter 630 or 633 of NRS, dentist, licensed nurse,

2-34  dispensing optician, optometrist, registered physical therapist,

2-35  podiatric physician, licensed psychologist, chiropractor, doctor of

2-36  Oriental medicine, medical laboratory director or technician, or a

2-37  licensed hospital and its employees.

2-38      Sec.  2.  Chapter 41A of NRS is hereby amended by adding

2-39  thereto the provisions set forth as sections 3 to 6, inclusive, of this

2-40  act.

2-41      Sec.  3.  “Professional negligence” means a negligent act or

2-42  omission to act by a provider of health care in the rendering of

2-43  professional services, which act or omission is the proximate cause

2-44  of a personal injury or wrongful death. The term does not include

2-45  services that are outside the scope of services for which the

3-1  provider of health care is licensed or services for which any

3-2  restriction has been imposed by the applicable regulatory board or

3-3  health care facility.

3-4  Sec.  4.  “Provider of health care” means a physician licensed

3-5  under chapter 630 or 633 of NRS, dentist, licensed nurse,

3-6  dispensing optician, optometrist, registered physical therapist,

3-7  podiatric physician, licensed psychologist, chiropractor, doctor of

3-8  Oriental medicine, medical laboratory director or technician, or a

3-9  licensed hospital and its employees.

3-10      Sec.  5.  In an action for injury or death against a provider of

3-11  health care based upon professional negligence, the injured

3-12  plaintiff may recover noneconomic damages, but the amount of

3-13  noneconomic damages awarded in such an action must not exceed

3-14  $350,000.

3-15      Sec.  6.  1.  In an action for injury or death against a

3-16  provider of health care based upon professional negligence, each

3-17  defendant is liable to the plaintiff for economic damages and

3-18  noneconomic damages severally only, and not jointly, for that

3-19  portion of the judgment which represents the percentage of

3-20  negligence attributable to the defendant.

3-21      2.  This section is intended to abrogate joint and several

3-22  liability of a provider of health care in an action for injury or

3-23  death against the provider of health care based upon professional

3-24  negligence.

3-25      Sec.  7.  NRS 41A.003 is hereby amended to read as follows:

3-26      41A.003  As used in this chapter, unless the context otherwise

3-27  requires, the words and terms defined in NRS 41A.004 to 41A.013,

3-28  inclusive, and sections 3 and 4 of this act have the meanings

3-29  ascribed to them in those sections.

3-30      Sec.  8.  NRS 41A.097 is hereby amended to read as follows:

3-31      41A.097  1.  Except as otherwise provided in subsection 3, an

3-32  action for injury or death against a provider of health care may not

3-33  be commenced more than 4 years after the date of injury or 2 years

3-34  after the plaintiff discovers or through the use of reasonable

3-35  diligence should have discovered the injury, whichever occurs first,

3-36  for:

3-37      (a) Injury to or the wrongful death of a person occurring before

3-38  October 1, 2002, based upon alleged professional negligence of the

3-39  provider of health care;

3-40      (b) Injury to or the wrongful death of a person occurring before

3-41  October 1, 2002, from professional services rendered without

3-42  consent; or

3-43      (c) Injury to or the wrongful death of a person occurring before

3-44  October 1, 2002, from error or omission in practice by the provider

3-45  of health care.

4-1  2.  Except as otherwise provided in subsection 3, an action for

4-2  injury or death against a provider of health care may not be

4-3  commenced more than 3 years after the date of injury or [2 years] 1

4-4  year after the plaintiff discovers or through the use of reasonable

4-5  diligence should have discovered the injury, whichever occurs first,

4-6  for:

4-7  (a) Injury to or the wrongful death of a person occurring on or

4-8  after October 1, 2002, based upon alleged professional negligence of

4-9  the provider of health care;

4-10      (b) Injury to or the wrongful death of a person occurring on or

4-11  after October 1, 2002, from professional services rendered without

4-12  consent; or

4-13      (c) Injury to or the wrongful death of a person occurring on or

4-14  after October 1, 2002, from error or omission in practice by the

4-15  provider of health care.

4-16      3.  This time limitation is tolled for any period during which the

4-17  provider of health care has concealed any act, error or omission

4-18  upon which the action is based and which is known or through the

4-19  use of reasonable diligence should have been known to him.

4-20      4.  For the purposes of this section, the parent, guardian or legal

4-21  custodian of any minor child is responsible for exercising reasonable

4-22  judgment in determining whether to prosecute any cause of action

4-23  limited by subsection 1 or 2. If the parent, guardian or custodian

4-24  fails to commence an action on behalf of that child within the

4-25  prescribed period of limitations, the child may not bring an action

4-26  based on the same alleged injury against any provider of health care

4-27  upon the removal of his disability, except that in the case of:

4-28      (a) Brain damage or birth defect, the period of limitation is

4-29  extended until the child attains 10 years of age.

4-30      (b) Sterility, the period of limitation is extended until 2 years

4-31  after the child discovers the injury.

4-32      [5.  As used in this section, “provider of health care” means a

4-33  physician licensed under chapter 630 or 633 of NRS, a dentist,

4-34  registered nurse, dispensing optician, optometrist, registered

4-35  physical therapist, podiatric physician, licensed psychologist,

4-36  chiropractor, doctor of Oriental medicine, medical laboratory

4-37  director or technician, or a licensed hospital as the employer of any

4-38  such person.]

4-39      Sec.  9.  Chapter 42 of NRS is hereby amended by adding

4-40  thereto a new section to read as follows:

4-41      1.  In an action for injury or death against a provider of

4-42  health care based upon professional negligence, if the defendant

4-43  so elects, the defendant may introduce evidence of any amount

4-44  payable as a benefit to the plaintiff as a result of the injury or

4-45  death pursuant to the United States Social Security Act, any state

5-1  or federal income disability or worker’s compensation act, any

5-2  health, sickness or income-disability insurance, accident

5-3  insurance that provides health benefits or income-disability

5-4  coverage, and any contract or agreement of any group,

5-5  organization, partnership or corporation to provide, pay for or

5-6  reimburse the cost of medical, hospital, dental or other health care

5-7  services. If the defendant elects to introduce such evidence, the

5-8  plaintiff may introduce evidence of any amount that the plaintiff

5-9  has paid or contributed to secure his right to any insurance

5-10  benefits concerning which the defendant has introduced evidence.

5-11      2.  A source of collateral benefits introduced pursuant to

5-12  subsection 1 may not:

5-13      (a) Recover any amount against the plaintiff; or

5-14      (b) Be subrogated to the rights of the plaintiff against a

5-15  defendant.

5-16      3.  In an action for injury or death against a provider of

5-17  health care based upon professional negligence, a district court

5-18  shall, at the request of either party, enter a judgment ordering that

5-19  money damages or its equivalent for future damages of the

5-20  judgment creditor be paid in whole or in part by periodic payments

5-21  rather than by a lump-sum payment if the award equals or exceeds

5-22  $50,000 in future damages.

5-23      4.  In entering a judgment ordering the payment of future

5-24  damages by periodic payments pursuant to subsection 3, the court

5-25  shall make a specific finding as to the dollar amount of periodic

5-26  payments that will compensate the judgment creditor for such

5-27  future damages. As a condition to authorizing periodic payments

5-28  of future damages, the court shall require a judgment debtor who

5-29  is not adequately insured to post security adequate to ensure full

5-30  payment of such damages awarded by the judgment. Upon

5-31  termination of periodic payments of future damages, the court

5-32  shall order the return of this security, or so much as remains, to

5-33  the judgment debtor.

5-34      5.  A judgment ordering the payment of future damages by

5-35  periodic payments entered pursuant to subsection 3 must specify

5-36  the recipient or recipients of the payments, the dollar amount of

5-37  the payments, the interval between payments, and the number of

5-38  payments or the period of time over which payments will be made.

5-39  Such payments must only be subject to modification in the event of

5-40  the death of the judgment creditor. Money damages awarded for

5-41  loss of future earnings must not be reduced or payments

5-42  terminated by reason of the death of the judgment creditor, but

5-43  must be paid to persons to whom the judgment creditor owed a

5-44  duty of support, as provided by law, immediately before his death.

5-45  In such cases, the court that rendered the original judgment may,

6-1  upon petition of any party in interest, modify the judgment to

6-2  award and apportion the unpaid future damages in accordance

6-3  with this subsection.

6-4  6.  If the court finds that the judgment debtor has exhibited a

6-5  continuing pattern of failing to make the periodic payments as

6-6  specified pursuant to subsection 5, the court shall find the

6-7  judgment debtor in contempt of court and, in addition to the

6-8  required periodic payments, shall order the judgment debtor to pay

6-9  the judgment creditor all damages caused by the failure to make

6-10  such periodic payments, including, but not limited to, court costs

6-11  and attorney’s fees.

6-12      7.  Following the occurrence or expiration of all obligations

6-13  specified in the periodic payment judgment, any obligation of the

6-14  judgment debtor to make further payments ceases and any security

6-15  given pursuant to subsection 4 reverts to the judgment debtor.

6-16      8.  As used in this section:

6-17      (a) “Future damages” includes damages for future medical

6-18  treatment, care or custody, loss of future earnings, loss of bodily

6-19  function, or future pain and suffering of the judgment creditor.

6-20      (b) “Periodic payments” means the payment of money or

6-21  delivery of other property to the judgment creditor at regular

6-22  intervals.

6-23      (c) “Professional negligence” means a negligent act or

6-24  omission to act by a provider of health care in the rendering of

6-25  professional services, which act or omission is the proximate cause

6-26  of a personal injury or wrongful death. The term does not include

6-27  services that are outside the scope of services for which the

6-28  provider of health care is licensed or services for which any

6-29  restriction has been imposed by the applicable regulatory board or

6-30  health care facility.

6-31      (d) “Provider of health care” means a physician licensed

6-32  under chapter 630 or 633 of NRS, dentist, licensed nurse,

6-33  dispensing optician, optometrist, registered physical therapist,

6-34  podiatric physician, licensed psychologist, chiropractor, doctor of

6-35  Oriental medicine, medical laboratory director or technician, or a

6-36  licensed hospital and its employees.

6-37      Sec.  10.  NRS 41A.031, 41A.041 and 42.020 are hereby

6-38  repealed.

6-39      Sec.  11.  If any provision of this act, or the application thereof

6-40  to any person, thing or circumstance is held invalid, such invalidity

6-41  shall not affect the provisions or application of this act which can be

6-42  given effect without the invalid provision or application, and to this

6-43  end the provisions of this act are declared to be severable.

7-1  Sec.  12.  The amendatory provisions of sections 5, 6 and 8 of

7-2  this act apply only to a cause of action that accrues on or after

7-3  October 1, 2003.

 

7-4  TEXT OF REPEALED SECTIONS

 

7-5  41A.031  Limitations on liability for noneconomic damages;

7-6   exceptions.

7-7  1.  Except as otherwise provided in subsection 2 and except as

7-8   further limited in subsection 3, in an action for damages for medical

7-9   malpractice or dental malpractice, the noneconomic damages

7-10   awarded to each plaintiff from each defendant must not exceed

7-11   $350,000.

7-12      2.  In an action for damages for medical malpractice or dental

7-13   malpractice, the limitation on noneconomic damages set forth in

7-14   subsection 1 does not apply in the following circumstances and

7-15   types of cases:

7-16      (a) A case in which the conduct of the defendant is determined

7-17   to constitute gross malpractice; or

7-18      (b) A case in which, following return of a verdict by the jury or

7-19   a finding of damages in a bench trial, the court determines, by clear

7-20   and convincing evidence admitted at trial, that an award in excess

7-21   of $350,000 for noneconomic damages is justified because of

7-22   exceptional circumstances.

7-23      3.  Except as otherwise provided in subsection 4, in an action

7-24   for damages for medical malpractice or dental malpractice, in the

7-25   circumstances and types of cases described in subsections 1 and 2,

7-26   the noneconomic damages awarded to each plaintiff from each

7-27   defendant must not exceed the amount of money remaining under

7-28   the professional liability insurance policy limit covering the

7-29   defendant after subtracting the economic damages awarded to that

7-30   plaintiff. Irrespective of the number of plaintiffs in the action, in no

7-31   event may any single defendant be liable to the plaintiffs in the

7-32   aggregate in excess of the professional liability insurance policy

7-33   limit covering that defendant.

7-34      4.  The limitation set forth in subsection 3 does not apply in an

7-35   action for damages for medical malpractice or dental malpractice

7-36   unless the defendant was covered by professional liability insurance

7-37   at the time of the occurrence of the alleged malpractice and on the

7-38   date on which the insurer receives notice of the claim, in an amount

7-39   of:

7-40      (a) Not less than $1,000,000 per occurrence; and

8-1  (b) Not less than $3,000,000 in the aggregate.

8-2  5.  This section is not intended to limit the responsibility of any

8-3   defendant for the total economic damages awarded.

8-4  6.  For the purposes of this section, “gross malpractice” means

8-5   failure to exercise the required degree of care, skill or knowledge

8-6   that amounts to:

8-7  (a) A conscious indifference to the consequences which may

8-8   result from the gross malpractice; and

8-9  (b) A disregard for and indifference to the safety and welfare of

8-10   the patient.

8-11      41A.041  Medical malpractice: Several liability for

8-12   noneconomic damages.

8-13      1.  In an action for damages for medical malpractice, each

8-14   defendant is liable for noneconomic damages severally only, and

8-15   not jointly, to the plaintiff only for that portion of the judgment

8-16   which represents the percentage of negligence attributable to the

8-17   defendant.

8-18      2.  As used in this section, “medical malpractice” means the

8-19   failure of a physician, hospital, employee of a hospital, certified

8-20   nurse midwife or certified registered nurse anesthetist in rendering

8-21   services to use the reasonable care, skill or knowledge ordinarily

8-22   used under similar circumstances.

8-23      42.020  Actions for damages for medical malpractice:

8-24   Reduction of damages by amount previously paid or

8-25   reimbursed; payment of future economic damages.

8-26      1.  Except as otherwise provided in subsection 2, in any action

8-27   for damages for medical malpractice, the amount of damages, if

8-28   any, awarded in the action must be reduced by the amount of any

8-29   prior payment made by or on behalf of the provider of health care

8-30   against whom the action is brought to the injured person or to the

8-31   claimant to meet reasonable expenses of medical care, other

8-32   essential goods or services or reasonable living expenses.

8-33      2.  In any action described in subsection 1 in which liability for

8-34   medical malpractice is established or admitted, the court shall,

8-35   before the entry of judgment, hold a separate hearing to determine

8-36   if any expenses incurred by the claimant for medical care, loss of

8-37   income or other financial loss have been paid or reimbursed as a

8-38   benefit from a collateral source. If the court determines that a

8-39   claimant has received such a benefit, the court shall reduce the

8-40   amount of damages, if any, awarded in the action by the amount of

8-41   the benefit. The amount so reduced must not include any amount

8-42   for which there is a right of subrogation to the rights of the claimant

8-43   if the right of subrogation is exercised by serving a notice of lien on

8-44   the claimant before the settlement of or the entry of judgment in the

8-45   action. Notice of the action must be provided by the claimant to any

8-46   statutory holder of a lien.

9-1  3.  If future economic damages are awarded in an action for

9-2  medical malpractice, the court may, at the request of the claimant,

9-3   order the award to be paid:

9-4  (a) In a lump sum which has been reduced to its present value as

9-5   determined by the trier of fact and approved by the court; or

9-6  (b) Subject to the provisions of subsections 5 and 6 and the

9-7   discretion of the court, in periodic payments either by an annuity

9-8   purchased to provide periodic payments or by other means if the

9-9   defendant posts an adequate bond or other security to ensure full

9-10   payment by periodic payments of the damages awarded by the

9-11   judgment.

9-12  As used in this subsection, “future economic damages” includes

9-13   damages for future medical treatment, care or custody, and loss of

9-14   future earnings.

9-15      4.  If the claimant receives periodic payments pursuant to

9-16   paragraph (b) of subsection 3, the award must not be reduced to its

9-17   present value. The amount of the periodic payments must be equal

9-18   to the total amount of all future damages awarded by the trier of

9-19   fact and approved by the court. The period for which the periodic

9-20   payments must be made must be determined by the trier of fact and

9-21   approved by the court. Before the entry of judgment, each party

9-22   shall submit to the court a plan specifying the recipient of the

9-23   payments, the amount of the payments and a schedule of periodic

9-24   payments for the award. Upon receipt and review of the plans, the

9-25   court shall specify in its judgment rendered in the action the

9-26   recipient of the payments, the amount of the payments and a

9-27   schedule of payments for the award.

9-28      5.  If an annuity is purchased pursuant to paragraph (b) of

9-29   subsection 3, the claimant shall select the provider of the annuity.

9-30   Upon purchase of the annuity, the claimant shall:

9-31      (a) Execute a satisfaction of judgment or a stipulation for

9-32   dismissal of the claim with prejudice; and

9-33      (b) Release forever the defendant and his insurer, if any, from

9-34   any obligation to make periodic payments pursuant to the award.

9-35      6.  If the defendant posts a bond or other security pursuant to

9-36   paragraph (b) of subsection 3, upon termination of the payment of

9-37   periodic payments of damages, the court shall order the return of

9-38   the bond or other security, or as much as remains, to the defendant.

9-39      7.  As used in this section:

9-40      (a) “Benefit from a collateral source” means any money, service

9-41   or other benefit which is paid or provided or is reasonably likely to

9-42   be paid or provided to a claimant for personal injury or wrongful

9-43   death pursuant to:

10-1          (1) A state or federal act which provides benefits for

10-2  sickness, disability, accidents, loss of income or workers’

10-3   compensation;

10-4          (2) A policy of insurance which provides health benefits or

10-5   coverage for loss of income;

10-6          (3) A contract of any group, organization, partnership or

10-7   corporation which provides, pays or reimburses the cost of medical,

10-8   hospital or dental benefits or benefits for loss of income; or

10-9          (4) Any other publicly or privately funded program which

10-10   provides such benefits.

10-11     (b) “Medical malpractice” has the meaning ascribed to it in

10-12  NRS 41A.009.

 

10-13  H