Former lawmaker says Legislature intended for caps to apply to nursing homes

CHARLESTON - In recent years, Dr. Dan Foster, who works at Charleston Area Medical Center, the largest hospital in West Virginia, watched the relationship between acute care hospitals and nursing homes grow closer and closer.

In fact, he contends, nursing homes – now often referred to as nursing facilities – provide IVs, antibiotics and respiratory care treatments, as well as many other services that weren’t offered even five years ago. He expects to see more changes in these facilities, especially as health care reform unfolds.

“There’s going to be almost a vertical integration with hospitals, nursing homes, home-care companies and others,” said Foster, who practiced in general and vascular surgery, and also served as a member of the state House of Delegates and state Senate.

“That’s why I think it’s important that they all be lumped together and not be considered differently.”

The state Supreme Court will soon offer its own opinion on the similarity between nursing homes and hospitals and other health care providers, specifically as it relates to the state’s Medical Professional Liability Act and its inherent $500,000 cap on non-economic damages in medical malpractice cases.

In August 2011, a Kanawha County jury found that Heartland of Charleston, a 184-bed nursing and rehabilitation center then owned by HCR Manorcare, failed to feed and care for Dorothy Douglas, who died after leaving the facility.

The jury awarded Douglas’ family $80 million in punitive damages and $11.5 million in compensatory damages. The award was later reduced by nearly $400,000.

In April, Kanawha Circuit Judge Paul Zakaib, Jr. denied defendants a new trial in the case, saying the jury verdict was not unconstitutional or excessive.

He wrote that “this verdict sends a clear ‘deterrence’ message to a multi-million dollar nursing home corporation that its misconduct will not be tolerated in West Virginia.”

McHugh Fuller of Hattiesburg, Miss., plaintiffs counsel in the case, recently submitted its argument to the state Supreme Court. Bailey & Glasser, the defense counsel, planned to submit its argument Oct. 16. Neither could be reached for comment.

Foster, who joined the state Legislature in 2002 and helped pass the MPLA in 2003, argues that lawmakers’ intent was to include nursing homes in the group of health care providers that would receive protection in medical malpractice lawsuits.

According to the law, “In any professional liability action brought against a health-care provider pursuant to this article, the maximum amount recoverable as compensatory damages for non-economic loss shall not exceed $250,000 per occurrence.”

The MPLA further states that “the plaintiff may recover compensatory damages for non-economic loss in excess of the limitation described… but not in excess of $500,000 for each occurrence … where the damages for non-economic losses suffered by the plaintiff were for: (1) Wrongful death; (2) permanent and substantial physical deformity, loss of use of a limb or loss of a bodily organ system; or (3) permanent physical or mental functional injury that permanently prevents the injured person from being able to independently care for himself or herself and perform life sustaining activities.”

In his experience, Foster says the policy of capping non-economic damages makes sense to those who understand the purpose of the law.

“I agree with the way the tort system works, and it’s useful to try to make people whole if they’ve been injured in any way, whether it’s related to a medical misadventure or other misadventures,” he said.

“But the public doesn’t realize that the costs that legitimately occurred from that medical harm or non-medical harm – that’s not capped. It’s the pain and suffering aspect that’s capped.”

Thomas Heywood, a managing partner of Bowles Rice in Charleston who lobbies for and represents various health care providers at the state Capitol, became involved not only with the MPLA but also with the recent Senate Bill 101. The measure, signed by Gov. Earl Ray Tomblin in April, clarifies that all of the MPLA’s limitations and provisions apply to nursing homes.

Heywood explains that legislators felt the clarification was necessary after some judges and juries, such as those in the Heartland of Charleston case, deferred to the Nursing Home Act instead of the MPLA on the issue of medical malpractice caps.

“Even though the bill says that nursing homes are covered, there is this older, historic legislation that covered nursing homes only, and the question was raised over which governed, the NHA or the MPLA,” he said.

“The bulk of this new legislation was to make clear that nursing homes were to be included under the act.”

Senate Bill 101 states that as of July 1, “nursing homes and their health-care providers shall be treated in the same manner as any other health-care facility or health-care provider.” However, the law also states that there should be no interference to any pending legal action pursuant to this date.

“The Legislature here in West Virginia respects the separation of powers,” Heywood said.

“It never wants to reach in and turn knobs and dials on pending litigation. We want the cases that are pending to be resolved appropriately by judges and juries according to their merits.”

Jonathan Rosenfeld, a Chicago personal injury lawyer who often handles nursing home cases, sees the Heartland of Charleston case and its underlying issues from a different perspective.

“Most of the time when caps are enacted, it’s done by industry pressure to limit the liability of a particular group of facilities or a particular institution,” he said.

“They take a lot of the rights out of the patients’ hands, and they stack the deck in favor of the institution and the business interests of that group.”

Rosenfeld contends that these caps are usually enacted “under the guise” of lowering health care costs and insurance premiums. However, he continues, in states like Texas where medical malpractice caps have been enacted for more than a decade, premiums have only increased.

Heywood disagrees, arguing that medical malpractice caps have been a success in West Virginia. Before the MPLA, he says, businesses were unable to effectively understand or quantify risks in the market.

“From the standpoint of predictability, one of the things that caps do is make your overall liability exposure much more predictable over time, both for the industry and the insurance companies that might be writing coverage,” he said.

“That’s the drive.”