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Governors Focus on Medicaid Reforms
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Gov. Mike Huckabee,
Arkansas
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The National Governors Association (NGA) wrapped up its Annual Meeting on July 18 after expressing strong support for federal legislation to reform the Medicaid program. States have experienced tremendous growth in Medicaid expenditures over the past few years, especially in coverage for long-term care, with the program becoming the largest single budget item for many of them. Legislation currently before Congress would give states added flexibility to improve their Medicaid programs with the intention of modernizing, streamlining, and strengthening the program. Areas targeted for improvement include prescription drug programs, cost-sharing arrangements, benefit package flexibility, and asset policy reforms.
Newly installed chair of the group, Arkansas Gov. Mike Huckabee ( R), testified before Congress on this issue. During his testimony, he presented the recommendations of an NGA report on Medicaid reform, which is available at http://www.nga.org/Files/pdf/0506medicaid.pdf.
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Wisconsin Court Strikes Down Cap
On July 14, a divided Wisconsin Supreme court declared the $350,000 cap on noneconomic damages in medical liability suits unconstitutional. In Matthew Ferdon vs Wisconsin Patients Compensation Fund, the jury had awarded Matthew Ferdon and his family $700,000 in noneconomic damages; the court applied the cap, which reduced the award to just over $400,000 (based on annual inflation adjustments). The Ferdon's appealed the ruling. The justices ruled 4 to 3 that the cap violated the equal protection guarantees of the state's constitution. In their opinion, the court was quick to point out that "just because caps on noneconomic damages are not unconstitutional per se does not mean that a particular cap is constitutional." Indeed, in October 2004 the Wisconsin Supreme Court, in Yvette M. Maurin v. Gordon Hall, M.D., upheld the cap on noneconomic damages "for wrongful death medical malpractice actions." It is important to note that this current ruling does not negate the October 2004 ruling that caps are constitutional in cases of wrongful death.
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Wyoming's First Lady to Support UPPL Repeal
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Wyoming's First Lady
Nancy Freudenthal
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Wyoming's First Lady Nancy Freudenthal has indicated that she will push for the repeal of the law that allows companies to withhold coverage for injuries resulting from the use of drugs or alcohol. This type of law, commonly referred to as the Uniform Accident and Policy Provision or UPPL, was first created as a model law in 1947 by the National Association of Insurance Commissioners (NAIC) and was subsequently adopted by most states. In 2001, NAIC formally changed its position on this issue and now supports repeal of the law.
Rep. Dave Edwards (R-Douglas), co-chairman of Wyoming's joint Transportation, Highways and Military Affairs Interim Committee, has said that a bill will be drafted to address the First Lady's concerns. The bill will be discussed by the committee later this year.
Mrs. Freudenthal's desire to repeal the UPPL statute derives from one of her top initiatives--preventing alcohol abuse, especially among young people. She is the co-chair of a nationwide initiative known as Leadership to Keep Children Alcohol Free and is a member of the National Institute on Alcohol Abuse and Alcoholism's Underage Drinking Initiative Steering Committee.
Several states recently saw legislative action on their own UPPL repeal bills:
- Rhode Island: HB 5778 became law.
- Nevada: AB 63 became law.
- New York: AB 6577 passed the legislature and is awaiting action by the Governor.
- California: SB 573 passed the legislature but was vetoed by the Governor for the second year in a row.
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Wellpoint Settles with Doctors for $198 Million
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In response to payment and contract practices by numerous insurers, physician organizations around the country filed lawsuits against them many years ago. The suits alleged systematic underpayment of physicians as well as a host of other unfair business practices. In 2000, these suits were consolidated into a class-action lawsuit. Just last month, Wellpoint, Inc. announced the settlement of two national lawsuits against its pre-merger companies, WellPoint Health Networks Inc. and Anthem, Inc., making this the fifth and largest settlement as a result of the class-action suit.
Terms of the $198 million dollar settlement include: $58 million in legal fees; $135 million to physicians; and $5 million to a not-for-profit foundation aimed at improving health care for the disadvantaged.
Duane M. Cady, MD, FACS, Chair of the AMA's Board of Trustees, issued this statement in response to the announcement of the settlement: "The AMA is pleased to learn that WellPoint has settled the lawsuit brought by physicians and state and county medical societies. The AMA hopes that the remaining defendants in the lawsuit will also settle in order to move toward improved relations with physicians [who] have been seriously damaged by years of unfair business practices."
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Proponents of Caps Try the Ballot Box
Tired of fighting with partisan legislatures, proponents of caps on noneconomic damages are taking their advocacy efforts to the voters. Some states, like Washington, have stipulations in their statutes that initiatives not voted on in the legislature will be placed on the next election ballot. Consequently, this fall Washington voters will have a chance to vote on I-330 for themselves. Initiative 330 contains liability reforms such as a cap on noneconomic damages and a limit on attorney contingency fees in medical malpractice lawsuits. The trial lawyers in Washington have introduced their own "reform" measure, I-336, to be included on the November ballot as well.
Some state constitutions, like Arizona's, prohibit the legislature from enacting caps. As a result, SCR 1035 would give the legislature the authority needed to enact caps. It will be brought to the voters as a ballot question in November 2006.
Kentucky's Gov. Ernie Fletcher is urging the legislature to pass a bill in next year's session that would place on the 2006 ballot a constitutional amendment allowing legislators to cap awards for noneconomic damages. No bill has been formally introduced as of yet.
For more information on Washington's I-330 & I-336, visit:
http://www.yesoni330.org/
http://www.facs.org/ahp/feb05crosscountry.html
The full text of Arizona's SCR 1035 can be found at http://www.azleg.state.az.us/FormatDocument.asp?
inDoc=/legtext/47leg/1r/bills/scr1035p%2Ehtm&DocType=B
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Past Issues of ACS Cross Country:
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ACS State Affairs
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Division of Advocacy and Health Policy
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Jon H. Sutton
Manager, State Affairs
Chicago Headquarters
312-202-5358
jsutton@facs.org |
Mindy Baker
State Affairs Associate
Chicago Headquarters
312-202-5363
mbaker@facs.org |
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Revised August 3, 2005
Advocacy and Health Policy
This page and all contents are Copyright © 2003-2005
by the American College of Surgeons, Chicago, IL 60611-3211
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