Congressional and Judicial Update:
White House May Veto Senate HMO "Reform";
Major Victory in Oregon Against Non-Economic Damage Caps

On July 14, Senate Democrats failed by a margin of only three votes in their effort to empower 125 million Americans by giving them the right to hold managed care accountable for delaying or denying medical care that results in an injury or death. But the day also saw a huge win for the consumers of Oregon when the state's supreme court struck down a law limiting non-economic damages.

In the Oregon victory, the Oregon Supreme Court unanimously struck down a 12-year-old state law limiting non-economic damages to only $500,000. Finding that a cap on damages violates the state constitutional guarantee of an "inviolate" right to trial by jury, the court said that a legislated limit on available damages is utterly unlike a judicial remittitur, where a plaintiff is afforded a choice between the lowered damage award of a new trial in which the larger amount could be confirmed. Equally important, the Court rejected defense arguments that the legislature has the power to alter or repeal all laws, holding that the Constitution places limits on the legislature that include rights recognized at the common law.

The decision marks the second time in a week that a state supreme court has upheld plaintiff rights on constitutional grounds at the urging of AAJ. Earlier, the Indiana Supreme Court used arguments crafted by AAJ's Legal Affairs staff to hold that a two-year "occurrence" statute of limitations in medical malpractice cases was unconstitutional as applied to diseases or injuries with long latency periods. In the Oregon case, the Court accepted AAJ's arguments about the constitutional status and importance of common law rights.

For more information on the Oregon decision, go to http://www.publications.ojd.state.or.us/S44110a.htm.

Meanwhile, in the long-awaited U.S. Senate floor action on HMO reform, the vote was 53-to-47 in favor of an amendment offered by Senator Judd Gregg (R-NH) to strip HMO accountability from the Daschle-Kennedy Patients' Bill of Rights. Voting with all 45 Senate Democrats on the HMO liability issue were GOP Senators Arlen Specter (PA) and Peter Fitzgerald (IL).

After four intense days of debate, lobbying an voting on various amendments, the GOP version of the bill passed 53-to-47. Republican Senators John Chafee (RI) and Fitzgerald joined their Democratic colleagues in voting against this sham bill. The pressure is now on the House of Representatives to pass a managed care bill before the August 6th recess. Managed care legislation is pending in both the House Commerce Committee and the Education & the Workforce Committee.

President Clinton has stated that he will veto the Senate-passed bill on managed care health.