Is The Legal System Killing Health Care? In Illinois, The Answer is ‘Yes’

Published March 26, 2004

The Illinois state court system ranks as one of the worst legal liability systems in the United States, according to the 2004 State Liability Ranking Study just released by the U.S. Chamber of Commerce’s Institute for Legal Reform.

Overall, the Illinois state court system was ranked in the study as the 44th worst in the nation, which surveyed 1,402 senior corporate attorneys from all 50 states, including 201 from Illinois. Only Texas, California, Louisiana, Alabama, West Virginia, and Mississippi ranked lower overall. The rankings of Illinois’ neighboring states: Iowa, 4; Wisconsin, 10; Indiana, 11; Kentucky, 35; and Missouri, 41.

Two county court systems in Illinois–Madison County and Cook County–were ranked this year in 3rd and 5th place among local jurisdictions with the least fair and reasonable litigation environment. Only one other state–California–had two jurisdictions among the five worst.

Illinois also ranked this year among the five states most likely to award excessive punitive damages, according to the Chamber study. The Illinois State Medical Society reports that, from 1997 through 2002, the average jury award for non-economic damages, such as punitive damages and pain and suffering, went up 132 percent. Non-economic damages in 2002 made up 92 percent of the money awarded by Illinois juries, ISMS said. Doctors for Medical Liability Reform, a coalition of 230,000 practicing medical specialists, reports that Illinois juries awarded $271 million in 2000–the fourth highest amount in the nation.

Health care is suffering as a result. Nationally, the costs of medical malpractice insurance policies – which increased between 30 percent and 75 percent between 2000 and 2002–are driving some doctors out of the practice or into less risky specialties. Some residents of malpractice hot spots cannot receive treatment by local obstetricians and neurosurgeons, The Manhattan Institute reports.

Scores of doctors have already left medicine or have moved their practices out of Illinois because they cannot afford malpractice premiums or can no longer obtain coverage at any price, according to the Chamber. In a poll of Illinois neurosurgeons, half of the surgeons in the state are considering leaving the state. A third are considering early retirement, DMLR reports.

In Joliet, lives are literally in jeopardy because two brain surgeons have shut down their practices, leaving the city without 24 hour care for head trauma cases.

Meanwhile, almost 80 percent of doctors report that they have ordered unnecessary medical testing and 74 percent of doctors report that they make referrals to specialists that are not needed, according to The Manhattan Institute, even while health care becomes increasingly uaffordable.

Such concerns led the American Medical Association to declare Illinois a state “in crisis.”

As a result of out-of-control litigation costs, workers pay the equivalent of a 5 percent tax on wages, the sum of $809 per year. That’s 2 percentage points higher that the Illinois state income tax rate.

And the ripple effects extend still further. Since 1995, Illinois has lost more than 175,000 manufacturing jobs. A health care system “in crisis” is bad for business. “It’s hard to grow your business, attract quality employees and justify new investment in a place that’s increasingly unhealthy for workers, unfriendly to business and unaffordable for doctors,” said DMLR in a recent Wall Street Journal advertisement.

Persons with legitimate injuries ought to have their day in court. But it’s a broken system that awards $22 million in actual damages but a total of $249 million in non-economic damages such as punitive damages, pain and suffering, emotional distress, and loss of consortium.

Illinois has twice put caps on non-economic damages, as several neighboring states have done, but the Illinois Supreme Court has twice ruled them unconstitutional. The legislature should try again by enacting caps on the recovery of non-economic damages and by adopting restrictions and qualification on testimony by “expert” witnesses. Measures to enable more people to serve on juries should also be enacted, such as increased per-diem payments to jurors, particularly in lengthy trials, and tax credits for employers who continue to pay the full salaries of employees called for jury duty. And voters should scrutinize the backgrounds, rulings, and writings of candidates for judicial posts, particularly on the Illinois Supreme Court, on tort reform issues.

Maureen Martin is Senior Fellow for Legal Affairs for The Heartland Institute, a national nonprofit organization. If you have any questions or need additional information, please contact Allen Fore, Vice President – Public Affairs at The Heartland Institute at 312/337-4000 or [email protected]. Reprint permission for this Heartland Perspective–on op-ed pages, in newsletters, etc.–is hereby granted. Please send a tearsheet to The Heartland Institute, 19 South LaSalle Street #903, Chicago, IL 60603.