Tort reform amendment gone

More robust legislation needed

A bill that would have capped non-economic damages awarded in medical negligence tort cases to US$500,000 has been withdrawn by the Cayman Islands Government.

Lawyers and stakeholders advised it did not go far enough to have a meaningful effect on medical malpractice insurance premiums.

Instead, a more robust Medical Negligence (Non-Economic Damages) Bill will be brought forward for consideration.

“It was felt that while the Torts (Reform) (Amendment) Bill, 2011 would impose an appropriate cap on non-economic damages for cases of tort, there was concern that it would be ineffective against cases of medical negligence, which were brought under contract law,” Minister for Health, Environment, Youth, Sports and Culture Mark Scotland told the Legislative Assembly last week.

This could mean people would pursue much higher damages through breach of contract cases by side-stepping the tort law, he noted.

“I discussed this concern with our legal advisors in the Attorney General’s Chambers and they advised me that it was a concern that had merit and warranted further consideration.

“They subsequently advised that in order to effectively cap non-economic damages in medical negligence cases, including those arising from Tort and Contract law, it would be better to have a stand-alone piece of legislation that would address it rather than attempting to insert contract law into tort law.”

Feasibility threatened

The torts reform amendment had been originally proposed due to local obstetricians facing significant increases in their medical malpractice insurance premiums, potentially threatening the feasibility of practices. At least one had opted to close, said Mr. Scotland,

“The concern for the general public, which was documented in the newspapers at the time, was whether there could be sufficient practicing obstetricians to meet our population’s needs, and whether we would ultimately see a situation where very few of us could actually have our children born here as there would not be sufficient practicing obstetricians to deliver the necessary care.”

Premiums had increased by 300 per cent in four years, partly as a result of insurers including Medical Protection Society believing that Cayman’s justice system was following a United States trend of moving toward more generous awards for non-economic damages.

The Torts (Reform) (Amendment) Bill was brought to the house in February, 2010.

It was given an impetus by Dr. Shetty’s mooted medical tourism facility. Clause 2.11(f) of the agreement between the government and the doctor states that the government undertakes to take the necessary steps to ‘limit malpractice/medical negligence awards… to a maximum of US$500,000 per individual case in respect of non-economic loss.’

“[At] the time we were negotiating that agreement, Dr. Shetty’s insurers had already told him that unless there was such a cap in place his medical malpractice premiums would be significantly increased… [so much] as to put the economic feasibility of the project in doubt,” recalled Mr. Scotland.

The bill was Gazetted on 31 December. However, during the mandatory 21-day consultation period following its publication, concerns had been raised by stakeholders that the legislation did not go far enough to have a meaningful effect on the medical malpractice insurance premiums.

The replacement Medical Negligence (Non-Economic Damages) Bill, 2011 was published in the Gazette on 18 February and will be debated after its 21-day Gazette period has expired.

International reputation

Mr. Scotland also said he wanted to take the opportunity to set the record straight regarding suggestions that Dr. Shetty had requested a cap because his staff would be substandard or act with a greater level of negligence than current healthcare providers.

“Dr. Shetty has assured this government that he intends to hire top class, internationally-respected, eminently experienced and highly-qualified practitioners. His business model depends on being able to provide, and in fact exceed, the level of expertise and care that his largest target client group, patients from the North American market, have come to expect from their healthcare providers and facilities.

“Dr. Shetty has an international reputation to protect and international and educated clients to care for – he is not going to risk his reputation or his financial success by running a substandard facility with substandard staff.”

Because of the sheer number of practitioners that the doctor would be employing when the project reached its full capacity of 2,000, any savings in medical malpractice insurance would significantly affect the bottom line. It was simple arithmetics or economics, he said.