New York State Passes Budget Sans “Tort Reform”

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As we recently reported on our blog, New York State Governor Cuomo sought to establish a cap on non-economic damages (which typically include pain and suffering awards) in medical malpractice cases in New York.  Under the Governor’s proposal, non-economic damage awards would have been limited to $250,000.  The proposal, however, was dropped from the Governor’s budget plan that was approved by the State legislature.  More details on the approved budget deal are available here.

Almost immediately, the Governor’s proposal was met with opposition.  As reported in the New York Law Journal, Democrats in the State Assembly adamantly opposed the cap, arguing that “[i]t hurts litigants who have a diminished quality of life for which they will not be compensated.”  Hospital and health care agencies, however, argued that the cap would help health care providers deal with rising costs through malpractice judgments and insurance premiums.  And, Governor Cuomo’s chief Medicaid cost-cutting strategist had previously indicated that the cap could result in annual savings to the state of $419 million.  To be sure, some have argued that medical malpractice reform is “desperately needed” in New York — and cite examples of  OB-GYNs in New York who pay more in insurance premiums than they take home in pay (causing them to stop practicing in New York).

Thus, while the Governor’s tort reform proposal spurred a lot of discussion and debate among politicians and blogs in New York (and elsewhere), it appears that the implementation of such reform in New York has been stalled–at least for now.