Why Does the 1970’s Medical Malpractice Insurance Crisis in Louisiana Matter in 2011?

In Russo v. Dr. Stephen Kraus, 2010-2463 (La. 1/28/2011), the Louisiana Supreme Court granted a writ and reinstated the judgment of the District Court denying a Sibley v. Board of Supervisors of Louisiana State University, 477 So.2d 1094 (La. 1985), hearing, which is a hearing to determine the constitutionality of provisions related to the Louisiana Medical Malpractice Act. The Louisiana Supreme Court’s Order was based in part on the Court’s prior findings concerning the existence of a medical malpractice insurance crisis in the 1970s.”

In effect, the Louisiana Supreme Court ordered that because an insurance crisis existed in the 1970’s, it is impermissible to conduct a “Sibley hearing” in 2011 to determine the unconstitutionality of the 3 year preemption period applicable to medical malpractice claims. The District Court had denied the plaintiffs the opportunity to have a hearing on the constitutionality of the 3 year preemption statute. The Fourth Circuit Court of Appeal reversed and ordered a “Sibley hearing.” The Supreme Court held that the Court of Appeal “erred in reversing the District Court’s judgment and remanding this matter for a Sibley v. Board of Supervisors of Louisiana State University, 477 So.2d 1094 (La. 1985), hearing on these issues. See Crier v. Whitecloud, 496 So.2d 305, 308-09 (La. 1986); see also, Branch v. Willis-Knighton Medical Center, 92-3086, pp. 9-10 (La. 4/28/94), 636 So.2d 211, 215, overruled on other grounds in David v. Our Lady of the Lake Hospital, 02-2675 (La. 07/02/03), 849 So.2d 38.”

At first glance, it appears that the Louisiana Supreme Court is implying that it will reject a challenge to the constitutionality of the $500,000 cap on general damages and lost wages in medical malpractice cases. However, the preemption provision before the Court and the cap on damages present two different issues that have totally different equal protection constitutional implications. The preemption provision affects every medical malpractice claimant in the same manner, while the cap on damages adversely (and unconstitutionally) impacts only those claimants with severe and disabling injuries and damages. The 1970’s cap is also woefully inadequate when considering 2011 dollars. So, while the medical malpractice insurance crisis of the 1970’s may still matter when it comes to issues effecting every claimant equally, the 40 year old medical malpractice insurance crisis does not matter when determining the constitutionality of the cap.