Senate Bill 1940

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    Florida Senate - 2000                                  SB 1940

    By Senator Campbell





    33-1290-00                                          See HB 171

  1                      A bill to be entitled

  2         An act relating to medical malpractice;

  3         amending s. 766.207, F.S.; revising provisions

  4         relating to voluntary binding arbitration of

  5         medical malpractice claims; providing for the

  6         effect of an offer to submit to voluntary

  7         binding arbitration with respect to allegations

  8         contained in the claimant's notice of intent

  9         letter; revising provisions relating to the

10         arbitration panel; revising provisions relating

11         to qualifications of arbitrators; revising rate

12         of compensation for medical negligence claims

13         arbitrators; revising provisions relating to

14         damages; deleting provisions relating to

15         certain rules; amending s. 766.209, F.S.;

16         revising provisions relating to the effect of

17         failure to offer or accept voluntary binding

18         arbitration; increasing certain damage award

19         limits; providing an effective date.

20

21  Be It Enacted by the Legislature of the State of Florida:

22

23         Section 1.  Section 766.207, Florida Statutes, is

24  amended to read:

25         766.207  Voluntary binding arbitration of medical

26  negligence claims.--

27         (1)  Voluntary binding arbitration pursuant to this

28  section and ss. 766.208-766.212 shall not apply to rights of

29  action involving the state or its agencies or subdivisions, or

30  the officers, employees, or agents thereof, pursuant to s.

31  768.28.

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    Florida Senate - 2000                                  SB 1940
    33-1290-00                                          See HB 171




  1         (2)  Upon the completion of presuit investigation with

  2  preliminary reasonable grounds for a medical negligence claim

  3  intact, the parties may elect to have damages determined by an

  4  arbitration panel. Defendants offering to submit to

  5  arbitration pursuant to this section and in conjunction with

  6  s. 766.106, shall be deemed to have admitted both liability

  7  and causation with respect to the allegations contained in the

  8  claimant's notice of intent letter. Such election may be

  9  initiated by either party by serving a request for voluntary

10  binding arbitration of damages within 90 days after receipt

11  service of the claimant's notice of intent to initiate

12  litigation upon the defendant. The evidentiary standards for

13  voluntary binding arbitration of medical negligence claims

14  shall be as provided in ss. 120.569(2)(g) and 120.57(1)(c).

15         (3)  Upon receipt of a party's request for such

16  arbitration, the opposing party may accept the offer of

17  voluntary binding arbitration within 30 days. However, in no

18  event shall the defendant be required to respond to the

19  request for arbitration sooner than 90 days after service of

20  the notice of intent to initiate litigation under s. 766.106.

21  Such acceptance within the time period provided by this

22  subsection shall be a binding commitment to comply with the

23  decision of the arbitration panel. The liability of any

24  insurer shall be subject to any applicable insurance policy

25  limits. A claimant's acceptance of an offer to arbitrate shall

26  not bar the claimant from pursuing a cause of action against

27  defendants who do not offer or agree to arbitration under this

28  section.

29         (4)  The arbitration panel shall be composed of three

30  arbitrators, one selected by the claimant, one selected by the

31  defendant, and one arbitrator selected jointly by the other

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    Florida Senate - 2000                                  SB 1940
    33-1290-00                                          See HB 171




  1  two arbitrators who shall serve as the chief arbitrator.  In

  2  the event of multiple plaintiffs or multiple defendants, the

  3  arbitrator selected by the side with the multiple parties

  4  shall jointly select the arbitrator for their side.  If the

  5  multiple parties cannot reach agreement as to their

  6  arbitrator, a petition shall be filed with the chief judge of

  7  the appropriate circuit court, who shall select the arbitrator

  8  or arbitrators at issue an administrative law judge furnished

  9  by the Division of Administrative Hearings who shall serve as

10  the chief arbitrator.  In the event of multiple plaintiffs or

11  multiple defendants, the arbitrator selected by the side with

12  multiple parties shall be the choice of those parties.  If the

13  multiple parties cannot reach agreement as to their

14  arbitrator, each of the multiple parties shall submit a

15  nominee, and the director of the Division of Administrative

16  Hearings shall appoint the arbitrator from among such

17  nominees.

18         (5)  The arbitrators shall be independent of all

19  parties, witnesses, insurance carriers, self-insurance trusts

20  or risk retention groups of a party, and legal counsel, and no

21  officer, director, affiliate, subsidiary, or employee of a

22  party, witness, or legal counsel may serve as an arbitrator in

23  the proceeding.

24         (6)  The rate of compensation for medical negligence

25  claims arbitrators other than the administrative law judge

26  shall be set by the chief judge of the appropriate circuit

27  court using by schedule providing for compensation of not less

28  than $250 per day nor more than $750 per day or as agreed by

29  the parties. In setting the schedule, the chief judge shall

30  consider the prevailing hourly rate rates charged for the

31  delivery of professional services in the community.

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    Florida Senate - 2000                                  SB 1940
    33-1290-00                                          See HB 171




  1         (7)  Arbitration pursuant to this section shall

  2  preclude recourse to any other remedy by the claimant against

  3  any participating defendant, and shall be undertaken with the

  4  understanding that:

  5         (a)  Net economic damages shall be awardable,

  6  including, but not limited to, past and future medical

  7  expenses and 80 percent of wage loss and loss of earning

  8  capacity, offset by any collateral source payments paid.

  9         (b)  Any offset of collateral source payments made as

10  of the date of the arbitration hearing shall be in accordance

11  with s. 768.76.

12         (c)  Each claimant shall be entitled to receive a

13  maximum of $500,000 in noneconomic damages per incident of

14  medical malpractice from each defendant participating in

15  arbitration.  The Legislature is cognizant of the increasing

16  costs of goods and services each year, and recognizes that

17  fixing a set amount of compensation actually has the effect of

18  a reduction in compensation each year. Accordingly, the

19  conditional limitation on damages in this section shall be

20  increased at the rate of 5 percent each year, pro rated from

21  the effective date of this paragraph, to the date on which

22  noneconomic damages subject to such limitation are awarded by

23  arbitration, final judgment, or settlement Noneconomic damages

24  shall be limited to a maximum of $250,000 per incident, and

25  shall be calculated on a percentage basis with respect to

26  capacity to enjoy life, so that a finding that the claimant's

27  injuries resulted in a 50-percent reduction in his or her

28  capacity to enjoy life would warrant an award of not more than

29  $125,000 noneconomic damages.

30         (d)(c)  Damages for future economic losses may shall be

31  awarded to be paid by periodic payments pursuant to s.

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    Florida Senate - 2000                                  SB 1940
    33-1290-00                                          See HB 171




  1  766.202(8) and shall be offset by future collateral source

  2  payments.

  3         (e)(d)  Punitive damages shall not be awarded.

  4         (f)(e)  The defendant shall be responsible for the

  5  payment of interest on all accrued damages with respect to

  6  which interest would be awarded at trial.

  7         (g)(f)  The defendant shall pay the claimant's

  8  reasonable attorney's fees, and costs, and expenses as

  9  determined by the arbitration panel, which shall be taxed as

10  costs but in no event more than 15 percent of the award,

11  reduced to present value.

12         (h)(g)  The defendant shall pay all the costs of the

13  arbitration proceeding and the fees of all the arbitrators

14  other than the administrative law judge.

15         (i)(h)  Each defendant who submits to arbitration under

16  this section shall be jointly and severally liable for all

17  damages assessed pursuant to this section.

18         (j)(i)  The defendant's obligation to pay the

19  claimant's damages shall be for the purpose of arbitration

20  under this section only.  A defendant's or claimant's offer to

21  arbitrate shall not be used in evidence or in argument during

22  any subsequent litigation of the claim following the rejection

23  thereof.

24         (k)(j)  The fact of making or accepting an offer to

25  arbitrate shall not be admissible as evidence of liability in

26  any collateral or subsequent proceeding on the claim.

27         (l)(k)  Any offer by a claimant to arbitrate must be

28  made to each defendant against whom the claimant has made a

29  claim.  Any offer by a defendant to arbitrate must be made to

30  each claimant who has joined in the notice of intent to

31  initiate litigation, as provided in s. 766.106.  A defendant

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    Florida Senate - 2000                                  SB 1940
    33-1290-00                                          See HB 171




  1  who rejects a claimant's offer to arbitrate shall be subject

  2  to the provisions of s. 766.209(3). A claimant who rejects a

  3  defendant's offer to arbitrate shall be subject to the

  4  provisions of s. 766.209(4).

  5         (m)(l)  The hearing shall be conducted by all of the

  6  arbitrators, but a majority may determine any question of fact

  7  and render a final decision.  The chief arbitrator shall

  8  decide all evidentiary matters.

  9

10  The provisions of this subsection shall not preclude

11  settlement at any time by mutual agreement of the parties.

12         (8)  Any issue between the defendant and the

13  defendant's insurer or self-insurer as to who shall control

14  the defense of the claim and any responsibility for payment of

15  an arbitration award, shall be determined under existing

16  principles of law; provided that the insurer or self-insurer

17  shall not offer to arbitrate or accept a claimant's offer to

18  arbitrate without the written consent of the defendant.

19         (9)  The Division of Administrative Hearings is

20  authorized to promulgate rules to effect the orderly and

21  efficient processing of the arbitration procedures of ss.

22  766.201-766.212.

23         (10)  Rules promulgated by the Division of

24  Administrative Hearings pursuant to this section, s. 120.54,

25  or s. 120.65 may authorize any reasonable sanctions except

26  contempt for violation of the rules of the division or failure

27  to comply with a reasonable order issued by an administrative

28  law judge, which is not under judicial review.

29         Section 2.  Subsections (2), (3), and (4) of section

30  766.209, Florida Statutes, are amended to read:

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    Florida Senate - 2000                                  SB 1940
    33-1290-00                                          See HB 171




  1         766.209  Effects of failure to offer or accept

  2  voluntary binding arbitration.--

  3         (2)  If neither party requests or agrees to voluntary

  4  binding arbitration, the claim shall proceed to trial or to

  5  any available legal alternative such as offer of and demand

  6  for judgment under s. 768.79 or offer of settlement under s.

  7  45.061.

  8         (3)  If the defendant refuses a claimant's offer of

  9  voluntary binding arbitration:

10         (a)  The claim shall proceed to trial without

11  limitation on damages, and the claimant, upon proving medical

12  negligence, shall be entitled to recover prejudgment interest,

13  costs, and reasonable attorney's fees which shall be taxed as

14  costs up to 25 percent of the award reduced to present value.

15         (b)  The claimant's award at trial shall be reduced by

16  any damages recovered by the claimant from arbitrating

17  codefendants following arbitration.

18         (4)  If the claimant rejects a defendant's offer to

19  enter voluntary binding arbitration:

20         (a)  The damages awardable at trial shall be limited to

21  net economic damages, and, with regard to each defendant

22  offering voluntary binding arbitration, plus noneconomic

23  damages not to exceed $750,000 $350,000 per incident of

24  medical malpractice to each claimant.  The Legislature

25  expressly finds that such conditional limit on noneconomic

26  damages is warranted by the claimant's refusal to accept

27  arbitration, and represents an appropriate balance between the

28  interests of all patients who ultimately pay for medical

29  negligence losses and the interests of those patients who are

30  injured as a result of medical negligence. The Legislature is

31  cognizant of the increasing costs of goods and services each

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    Florida Senate - 2000                                  SB 1940
    33-1290-00                                          See HB 171




  1  year, and recognizes that fixing a set amount of compensation

  2  actually has the effect of a reduction in compensation each

  3  year. Accordingly, the conditional limitation on damages in

  4  this section shall be increased at the rate of 5 percent each

  5  year, pro rated from the effective date of this paragraph, to

  6  the date at which noneconomic damages subject to such

  7  limitation are awarded by arbitration, final judgment, or

  8  settlement.

  9         (b)  Net economic damages reduced to present value

10  shall be awardable, including, but not limited to, past and

11  future medical expenses and 80 percent of wage loss and loss

12  of earning capacity, offset only by any collateral source

13  payments paid for past economic damages.

14         (c)  Damages for future economic losses may shall be

15  awarded to be paid by periodic payments pursuant to s.

16  766.202(8), and shall be offset by future collateral source

17  payments.

18         Section 3.  This act shall take effect July 1, 2000,

19  and shall apply to all causes of action accruing on or after

20  that date.

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    Florida Senate - 2000                                  SB 1940
    33-1290-00                                          See HB 171




  1            *****************************************

  2                       LEGISLATIVE SUMMARY

  3
      Revises provisions relating to voluntary binding
  4    arbitration of medical negligence cases. Provides that
      defendants offering to submit to such arbitration shall
  5    be deemed to have admitted both liability and causation
      with respect to the allegations contained in the
  6    claimant's notice of intent letter. Revises provisions
      relating to the arbitration panel. Provides that the rate
  7    of compensation for medical negligence claims arbitrators
      shall be set by the chief judge of the appropriate
  8    circuit court using the prevailing hourly rate charged
      for the delivery of professional services in the
  9    community. Revises provisions concerning maximum amounts
      of damages which may be awarded. Deletes provisions
10    authorizing the making of described rules. Revises
      provisions relating to the effects of failure to offer or
11    accept voluntary binding arbitration. (See bill for
      details.)
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