Indiana vs. Kentucky: The tort reform story

Indiana is only one of six states that cap damages of all kinds – including lost wages and the cost of medical treatment – to victims of medical malpractice.

Though the figures are scheduled to rise over the next three years, for now, individual doctors and hospitals are only on the hook for $250,000, and the total award to plaintiffs is limited to $1.25 million.

Patients also must submit their claims to medical malpractice review panels, before they can sue and go to court.  And punitive damages are limited to three times the actual damages to the plaintiff.

The result is cheaper medical malpractice insurance premiums for doctors in Indiana, which Michael Rinebold, director of government relations for the Indiana State Medical Association, said encourages doctors to locate there.

Figures collected from malpractice insurance brokers show that doctors pay about 25 percent less for insurance in Indiana than Kentucky.

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But doctors in Kentucky pay out only slightly more in average claims per year than their counterparts in Indiana, according to the National Practitioner Data Bank. And consumers in the two states pay virtually the same amount per person on doctors and hospitals, according to the most recent data available.

Dr. Daniel Eichenberger, a practicing internist and pediatrician and CEO of Baptist Health Floyd, formerly known as Floyd Memorial Hospital, said that with caps on damages, providers are “not at the mercy of the emotional state of a jury.”

They also allow doctors to avoid ordering unnecessary tests they otherwise might feel compelled to require to avoid potential huge damage awards.

But a study published in 2014 in the New England Journal of Medicine found that emergency room doctors in three states with malpractice reform – Texas, South Carolina and Georgia – ordered no fewer MRIs and CT scans, and admitted no fewer patients to the hospital – than those in neighboring states without reforms.

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Steve Langer, a former president of the Indiana Trial Lawyers Association, said the statute often means catastrophically injured people are not fully compensated and are forced on Medicaid, with the state and taxpayers left to pick up the bill. He won an $8.5 million verdict in 2009 that was reduced to $1.25 million under state law for the family of a woman who died when doctors failed to diagnose and treat her obstructed bowel,

New Albany trial lawyer Pete Palmer, who has represented both sides in medical malpractice cases in Indiana and Kentucky, and now mostly mediates them, says the $250,000 limit on liability for individual medical providers in Indiana makes them and their insurers less willing to settle because they have less to lose.

“Tort reform has not decreased the case load in Indiana – not at all,” he said.

Reporter Andrew Wolfson can be reached at (502) 582-7189 or awolfson@courier-journal.com

Indiana v. Kentucky

Medical malpractice premiums (2013)

Internal medicine

Indiana: $8,508   

Kentucky: $11,457

General surgery   

Indiana: $31,323 

Kentucky: $43,778

Average annual medical malpractice claims per physician (2015)

Indiana: $7,064

Kentucky: $7,533

Average doctor and hospital payments per capita (2009)

Indiana: $4,119

Kentucky: $4074

Sources:  Cunningham Group, National Practitioner Data Bank, Kaiser Family Foundation