On May 3, 2012, the Indiana Supreme Court heard oral arguments in the case of Plank vs. Community Hospital challenging the constitutionality of the medical malpractice damages cap. Plank was represented by Robert S. Peck of the Center for Constitutional Litigation PC and John Muller of Montross, Miller, Muller, Mendelson & Kennedy at the hearing while the Hospital was represented by Robert Zeigler of Zeigler Cohen & Koch. The State of Indiana intervened and was represented by Thomas Fisher of the Office of the Indiana Attorney General.
After a jury in this medical malpractice action awarded Plank $8.5 million in damages, the trial court granted Community’s motion to reduce the award to conform to the Medical Malpractice Act’s cap on damages and entered judgment in the reduced amount. On cross-appeals, the Court of Appeals affirmed in part, reversed in part, and remanded for an evidentiary hearing on Plank’s constitutional challenges to the statutory cap on damages. Plank v. Community Hospitals of Indiana, Inc., 956 N.E.2d 731 (Ind. Ct. App. 2011), vacated. The Supreme Court granted petitions to transfer the case and assumed jurisdiction over the appeal.
Plank argued that the Medical Malpractice Act violated the Privileges and Immunities Clause of the Indiana Constitution (Article I, Section 23) in that it discriminates among healthcare providers and grants immunity to those who cause severe injuries and that immunity is not given to healthcare providers who may only cause “modest” injuries. Plank’s argument centered on the belief that physicians do not flee states that lack malpractice damage caps and that there is no longer the medical emergency in Indiana which was the basis for the Medical Malpractice Act in 1976. The State of Indiana argued that the current legal standard would not allow Plank to present proof that there is no causal link between insurance premiums and the cap. Such an analysis belongs to the legislature, which the State argues has continued to monitor the situation. The Court noted that it had, in fact, agreed in its ruling in Johnson v. St. Vincent Hospital, Inc. that the cap was a special immunity that was necessary. But, in Collins v. Day, the Court acknowledged that a classification granting such a special immunity which was proper when enacted may later cease to satisfy the requirement of Section 23 because of intervening changes in social or economic conditions. The Court specifically questioned the State on constitutionality of capping of actual medical damages as opposed to pain and suffering (non-economic damages). The State responded that the purpose of the cap on damages is to create a predictable exposure for the healthcare provider and the insurance carriers. Therefore the cap does not need to differentiate between actual medical damages and non-economic damages. Justice David specially referred the State to the Illinois medical malpractice act which had a non-economic cap of $1 million and no cap on actual medical damages. However, it was not mentioned that, in 2010t the Illinois Supreme Court held the non-economic cap of $1 million was unconstitutional in Lebron v. Gottlieb Memorial Hospital.
Plank also challenged the constitutionality of the cap as a violation of separation of powers guaranteed under Article III, Section 1 and Article VII, Section 1. He argued the cap usurps judicial authority by effectively imposing a legislative remittitur on jury verdicts without regard to the evidence and by requiring a judge to enter a judgment at variance with the record. The Defendants argued that Indiana legislature has the power to create and limit causes of action and modify the common law, especially with respect to recovery. Such laws do not constitute a legislative remittitur. Damages limitations are part of the remedy, and the legislature may alter the common law and change or abrogate remedies.
Finally, Plank argued that the Medical Malpractice Cap violates Article I, Section 21 (“Takings Clause”) of the Indiana Constitution. He argued that it deprived him and others in his position, of his property interest in his cause of action, and his wife of her property interest in her bodily integrity, without just compensation. Plank argued that it improperly places the entire public burden of enhancing the availability and affordability of health care on those most severely injured by medical negligence, rather than spreading that cost among all taxpayers. The Defendants countered that Plank did not have any vested rights or property rights in a particular measure of damages and the Legislature possesses broad authority to modify the scope and nature of such damages.
Another issue which was raised on cross-appeal by the Hospital was whether Plank waived his right to assert a constitutional challenge. The Hospital argued that Plank’s arguments regarding the constitutionality were waived on appeal because his constitutional challenge was not properly preserved at trial at the appropriate time. The record shows that, upon the rendering of the jury verdict, the Hospital moved for reduction of the verdict to the statutory cap and Plank did not respond. Plank’s counsel argued that he was consulting with his client and did not hear the oral motion. However, the trial court requested Plank’s counsel to draft the order reducing the award to the statutory limits and he agreed to do so. Eight (8) days later, Plank raised the constitutionality issue. Plank contends the Hospital was not prejudiced by any such delay. The Hospital noted that the matter had been pending for over six (6) years and, if it had been placed on notice that Plank was going to consider challenging the constitutionality of the cap if the verdict exceeded the cap, its defense strategy would have been extremely altered as it would have presented additional experts addressing the bills, which arguably qualified the Plaintiff for the damages up to the cap.
This decision will impact all qualified healthcare providers in Indiana. If the Court does find the cap to be unconstitutional, those providers could be forced to take steps to protect their personal assets to meet verdicts which exceed their current professional liability insurance.
The Court is expected to issue a ruling in the next few months.
Should you have any questions, please contact your regular Hall Render attorney.
