Ill. Gov. Signs Med-Mal Bill

Illinois Gov. Rod Blagojevich on Thursday signed into law a medical malpractice bill that will establish caps on noneconomic damages and institute other reforms to the state’s troubled med-mal system.

But while insurers are pleased with the damage caps, there are concerns that the bill didn’t go far enough. “While the caps on non-economic damages are a welcome provision, additional liability reforms should be considered to provide more stability in the market and offset the onerous insurance regulations that will do little to encourage insurers to re-enter Illinois, said Steve Schneider, American Insurance Association (AIA) vice president, Midwest region.

Among its major provisions, S.B. 475 amends the current Illinois Insurance Code by establishing a $500,000 cap on noneconomic damages for physicians, and a $1 million cap for hospitals. However, it also creates prior approval requirements for insurers seeking medmal rate increases in the state — a significant change for a state known for its open rating system, said Greg LaCost, counsel for the Property Casualty Insurers Association of America (PCI).

And although the law is immediately effective, there is a strong possibility that trial lawyers and other special interest groups may challenge its legality, said Phil Lackman, vice president, government relations for the Professional Independent Insurance Agents of Illinois.

Among other provisions, the new law also:

Adds two members of the public to the Illinois State Medical Disciplinary Board and provides for appointment of at least two deputy medical coordinators, and not less than one full-time investigator for every 2,500 physicians;

Amends the Illinois Good Samaritan Act to expand immunity from civil damages for services performed without compensation at, or upon referral from, free medical clinics;

Creates the Sorry Works! Pilot Program Act under which hospitals and physicians may acknowledge and apologize for mistakes in patient care and offer fair settlements;

Provides that, if the costs of cases handled under the Sorry Works! protocol by a hospital exceed the costs that would have been incurred otherwise, the hospital may apply for a grant from the Sorry Works! Fund.