[Congressional Bills 103th Congress]
[From the U.S. Government Publishing Office]
[H.R. 1192 Introduced in House (IH)]

103d CONGRESS
  1st Session
                                H. R. 1192

To provide for uniformity of quality and a substantial reduction in the 
     overall costs of health care in the United States through the 
       development of diagnostic and treatment protocols and the 
implementation of the protocols in the program under title XVIII of the 
  Social Security Act, the imposition of limitations on the amount of 
  damages that may be paid in a health care liability action, and the 
  mandatory establishment by States of alternative dispute resolution 
    systems to resolve health care liability claims, and for other 
                               purposes.


_______________________________________________________________________


                    IN THE HOUSE OF REPRESENTATIVES

                             March 3, 1993

Mr. Hunter introduced the following bill; which was referred jointly to 
    the Committees on Ways and Means, Energy and Commerce, and the 
                               Judiciary

_______________________________________________________________________

                                 A BILL


 
To provide for uniformity of quality and a substantial reduction in the 
     overall costs of health care in the United States through the 
       development of diagnostic and treatment protocols and the 
implementation of the protocols in the program under title XVIII of the 
  Social Security Act, the imposition of limitations on the amount of 
  damages that may be paid in a health care liability action, and the 
  mandatory establishment by States of alternative dispute resolution 
    systems to resolve health care liability claims, and for other 
                               purposes.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Savings Through Health Protocols and 
Malpractice Reform Act of 1993''.

  TITLE I--DEVELOPMENT AND IMPLEMENTATION OF DIAGNOSTIC AND TREATMENT 
                               PROTOCOLS

SEC. 101. SUBSTANTIAL REDUCTION IN COSTS OF HEALTH CARE THROUGH 
              IMPLEMENTATION IN MEDICARE PROGRAM OF DIAGNOSTIC AND 
              TREATMENT PROTOCOLS.

    (a) Centers for Development of Protocols and Model Training 
Programs.--Subject to subsection (b), the Secretary of Health and Human 
Services, after consultation with the advisory council established 
under section 103, shall make grants to or enter into contracts with 
public or nonprofit private entities for the operation of not less than 
4 and not more than 6 centers--
            (1) to develop diagnostic and treatment protocols for 
        various health conditions; and
            (2) to develop model programs for training health care 
        providers with respect to such protocols.
    (b) Uniformity of Quality and Substantial Reduction in Costs of 
Health Care as Principal Goals of Protocols.--The Secretary shall 
ensure that, in the development of protocols under subsection (a), the 
principal goals are achieving uniformity of quality in, and the 
substantial reduction of the overall costs of, health care in the 
United States.
    (c) Approval of Protocols and Programs; Plan for Implementation in 
Medicare Program.--
            (1) In general.--The Secretary shall require that all 
        protocols and programs developed under subsection (a) be 
        submitted to the Secretary. Subject to subsection (d), in the 
        case of each such protocol or program so submitted, the 
        Secretary shall--
                    (A) evaluate the protocol or program (as the case 
                may be) on the basis of the extent to which the 
                protocol or program facilitates the goal described in 
                subsection (b); and
                    (B) on such basis approve or disapprove the 
                protocol or program not later than 45 days after the 
                protocol or program is submitted to the Secretary.
            (2) Plan for implementation.--In the case of each protocol 
        and program approved under paragraph (1), the Secretary, not 
        later than 90 days after the protocol or program (as the case 
        may be) is so approved, shall submit to the appropriate 
        committees of the Congress a plan for the implementation of the 
        protocol or program in the program under title XVIII of the 
        Social Security Act. The plan shall include proposed 
        legislation for accomplishing such implementation.
    (d) Collaboration Among Centers.--The Secretary may not approve a 
protocol or program for purposes of subsection (c) unless the protocol 
or program (as the case may be) has been approved by each of the heads 
of the centers operated pursuant to subsection (a).

SEC. 102. REQUIREMENTS FOR CENTERS.

    The Secretary may provide a grant or contract under section 101(a) 
only if--
            (1) the applicant for the grant operates a medical 
        facility;
            (2) such facility has a large patient population; and
            (3) the administrators and medical staff of the facility 
        have demonstrated expertise in developing and implementing 
        successful programs for the reduction of health care costs.

SEC. 103. ADVISORY COUNCIL.

    The Secretary shall establish an advisory council to provide 
recommendations to the Secretary with respect to carrying out this 
title, including recommendations on approving applications for grants 
and contracts under section 101(a). The Secretary shall make 
appointments to such council from among health care providers and 
administrators of medical facilities who are not employees or officers 
of the Federal Government.

SEC. 104. GENERAL PROVISIONS.

    (a) Application for Grant or Contract.--The Secretary may provide a 
grant or contract under section 101(a) only if an application for the 
grant or contract is submitted to the Secretary and the application is 
in such form, is made in such manner, and contains such agreements, 
assurances, and information as the Secretary determines to be necessary 
to carry out this title.
    (b) Source of Funding.--The Secretary shall make grants and 
contracts under section 101(a) using only funds appropriated to carry 
out activities of the Administrator for Health Care Policy and 
Research.
    (c) Limitation on Amount Provided to Recipient.--The total amount 
provided to any entity under any grant or contract made under section 
101(a) may not exceed $5,000,000.
    (d) Definition.--For purposes of this title, the term ``Secretary'' 
means the Secretary of Health and Human Services.

             TITLE II--MEDICAL MALPRACTICE LIABILITY REFORM

SEC. 201. DEFINITIONS.

    In this title, the following definitions shall apply:
            (1) Economic damages.--The term ``economic damages'' means 
        damages paid to compensate an individual for medical expenses, 
        lost wages or other income, lost employment, burial expenses, 
        and other pecuniary losses.
            (2) Health care liability action.--The term ``health care 
        liability action'' means a civil action brought against a 
        health care provider (regardless of the theory of liability on 
        which the action is based) in which a plaintiff alleges an 
        injury caused by the provision of (or the failure to provide) 
        health care services, except that such term does not include--
                    (A) any action in which a plaintiff alleges an 
                intentional tort; or
                    (B) any action in which the plaintiff's sole 
                allegation is an allegation of an injury arising from 
                the use of a medical product.
            (3) Health care provider.--The term ``health care 
        provider'' means any individual or entity that is engaged in 
        the delivery of health care services and is required under 
        Federal or State law to be licensed, certified, or accredited 
        in order to deliver such services.
            (4) Injury.--The term ``injury'' means any illness, 
        disease, or other harm that is the subject of a health care 
        liability action.
            (5) Non-economic damages.--The term ``non-economic 
        damages'' means any damages paid to compensate an individual 
        for subjective, non-monetary losses, including pain, suffering, 
        inconvenience, mental suffering, emotional distress, loss of 
        society and companionship, loss of consortium, injury to 
        reputation, and humiliation, but does not include punitive 
        damages.
            (6) Secretary.--The term ``Secretary'' means the Secretary 
        of Health and Human Services.
            (7) State.--The term ``State'' means each of the several 
        States, the District of Columbia, the Commonwealth of Puerto 
        Rico, the Virgin Islands, Guam, American Samoa, and the 
        Northern Mariana Islands.

SEC. 202. MALPRACTICE LIABILITY REFORM REQUIREMENTS DESCRIBED.

    (a) In General.--Subject to section 203, a State meets the 
requirements of this section if it has enacted laws, rules, or 
regulations relating to the treatment of health care liability actions 
that meet the requirements of subsections (b) through (d), and relating 
to alternative dispute resolution mechanisms that meet the requirements 
of subsection (e).
    (b) Liability Several and Not Joint for Non-Economic Damages.--
            (1) In general.--With respect to non-economic damages, the 
        liability of each defendant in a health care liability action 
        shall be several only and shall not be joint. Each defendant 
        shall be liable only for the amount of non-economic losses 
        incurred by the plaintiff that is in direct proportion to the 
        defendant's percentage of responsibility for the injury 
        suffered by the plaintiff (as determined by the trier of fact 
        pursuant to paragraph (2)).
            (2) Determination of percentage of responsibility.--The 
        trier of fact shall determine the extent of each defendant's 
        responsibility for the non-economic injury suffered by the 
        plaintiff, and shall assign a percentage of responsibility for 
        such injury to each defendant.
    (c) Limitation on Noneconomic Damages.--
            (1) In general.--The total amount of noneconomic damages 
        that may be awarded to an individual and the family members of 
        such individual for losses resulting from an injury which is 
        the subject of a health care liability action may not exceed 
        $250,000, regardless of the number of health care providers 
        against whom the action is brought or the number of actions 
        brought with respect to the injury.
            (2) Adjustment for inflation.--The amount referred to in 
        paragraph (1) shall be increased every 3rd year (beginning with 
        the 3rd year that begins after the date of the enactment of 
        this Act) in the same manner as amounts are increased under 
        section 215(i) of the Social Security Act for base quarters or 
        cost-of-living computation quarters in such a year.
    (d) Mandatory Offsets for Damages Paid by a Collateral Source.--
            (1) In general.--The total amount of damages received by an 
        individual under a health care liability action shall be 
        reduced (in accordance with paragraph (2)) by any other payment 
        that has been or will be made to the individual to compensate 
        the individual for the injury that was the subject of the 
        health care liability action, including payment under--
                    (A) Federal or State disability or sickness 
                programs;
                    (B) Federal, State, or private health insurance 
                programs;
                    (C) private disability insurance programs;
                    (D) employer wage continuation programs; and
                    (E) any other source of payment intended to 
                compensate such individual for such injury.
            (2) Amount of reduction.--The amount by which an award of 
        damages to an individual shall be reduced under paragraph (1) 
        shall be the total amount of any payments (other than such 
        award) that have been made or that will be made to the 
        individual to compensate the individual for the injury that was 
        the subject of the action.
    (e) Establishment of Alternative Dispute Resolution Mechanisms.--
            (1) In general.--Each State shall have in effect at least 
        one mediation or pretrial screening panel that meets 
        requirements specified in regulations issued by the Secretary, 
        or shall have in effect another alternative dispute resolution 
        mechanism which the Secretary, in consultation with the 
        Attorney General, finds to be equally effective in deterring 
        the filing of frivolous health care liability actions and 
        providing fair and expeditious compensation for meritorious 
        health care liability claims.
            (2) Promulgation of regulations.--Subject to paragraph (3), 
        the Secretary, in consultation with the Administrative 
        Conference of the United States and the Attorney General, shall 
        promulgate regulations that specify the Secretary's criteria 
        for mediation and pretrial screening panels and for evaluating 
        the effectiveness of other alternative dispute resolution 
        mechanisms under paragraph (1).
            (3) Tolling of statute of limitations during alternative 
        procedures.--Any regulations promulgated by the Secretary 
        pursuant to paragraph (2) shall include a requirement that a 
        State may not include any time occurring after a claim is filed 
        with a mediation or pretrial screening panel or under any other 
        alternative dispute resolution mechanism under paragraph (1) 
        for purposes of determining the applicability of any statute of 
        limitations to a health care liability action arising from the 
        injury that is the subject of the claim.

SEC. 203. WAIVER OF REQUIREMENTS FOR GOOD CAUSE OR FOR CARRYING OUT 
              DEMONSTRATION PROJECTS.

    The Secretary may waive any of the requirements of subsections (b) 
through (e) of section 202 for good cause or to the extent necessary to 
enable a State to carry out an experimental, demonstration, or pilot 
project if, in the judgment of the Secretary, the project is likely to 
promote the objectives of this title.

SEC. 204. CERTIFICATION OF STATE COMPLIANCE.

    (a) Notification.--
            (1) In general.--Not later than 6 months before the 
        beginning of each year (beginning with the first year that 
        begins after the expiration of the 3-year period beginning on 
        the date of the enactment of this Act), each State shall submit 
        a notification to the Secretary, with a certification by the 
        Chief Executive Officer of the State that, on the date the 
        notification is submitted, the State has enacted, adopted, or 
        otherwise has in effect laws, rules, or regulations that meet 
        the requirements of section 202.
            (2) Contents of notification.--The notification shall be 
        accompanied by documentation to support the certification 
        required by this subsection, including copies of relevant State 
        statutes, rules, procedures, regulations, judicial decisions, 
        State constitutional provisions, and opinions of the State 
        Attorney General, and shall contain such other information, be 
        in such form, and be submitted in such manner, as the Secretary 
        may require.
    (b) Review of Notification.--
            (1) In general.-- Within 90 days after receiving a 
        notification under subsection (a), the Secretary shall review 
        the notification and determine whether the notification 
        demonstrates that the State has enacted, adopted, or otherwise 
        has in effect laws, rules, or regulations that meet the 
        requirements of section 202.
            (2) Approval of notification.--If the Secretary determines 
        that the notification makes such demonstration, the Secretary 
        shall approve the notification.
            (3) Notice of disapproval.--If, after reviewing a State's 
        notification under subsection (a), the Secretary determines 
        that the notification does not make the demonstration required, 
        the Secretary shall, not later than 15 days after making such 
        determination, provide the State with a written notice 
        specifying such determination and containing recommendations 
        for revisions which would cause the notification of the State 
        to be approved.
            (4) Review of revised notifications.--Not later than 30 
        days after receiving a revised notification, the Secretary 
        shall review the revised notification and determine whether the 
        notification demonstrates that the State has enacted, adopted, 
        or otherwise has in effect laws, rules, or regulations that 
        meet the requirements of section 202. If the Secretary 
        determines that the revised notification makes such a 
        demonstration, the Secretary shall approve the revised 
        notification.
    (c) Non-Compliance.--
            (1) Failure to submit notification.--If a State fails to 
        submit to the Secretary a notification or revised notification 
        pursuant to this section, the Secretary shall, not later than 
        15 days after the period provided for submitting notification 
        under this section, send the State written notice of 
        determination of non-compliance.
            (2) Failure to meet requirements.--If the Secretary 
        determines that a revised notification submitted under 
        subsection (b) does not demonstrate that the State has enacted, 
        adopted, or otherwise has in effect laws, rules, or regulations 
        that meet the requirements of section 202, and disapproves the 
        State's revised notification, the Secretary shall, not later 
        than 15 days after making such determination, provide the State 
        with written notice of non-compliance, including the 
        determination of the Secretary and the reasons therefore.
            (3) Failure to meet requirements after initial approval.--
        If, during any time period after a notification is approved 
        under this section, the Secretary determines that the State 
        does not have currently in effect or has ceased enforcing the 
        laws, rules, or regulations upon which the notification was 
        approved, the Secretary shall, not later than 30 days of making 
        such determination provide the State with written notice of 
        such determination and withdraw the approval of the 
        notification. Such notice shall specify the determination of 
        the Secretary and the reasons therefore.
    (d) Consultation With Attorney General.--In making determinations 
of compliance or non-compliance pursuant to this section, the Secretary 
shall consult with the Attorney General.

SEC. 205. INCENTIVES THROUGH MEDICARE AND MEDICAID.

    (a) Medicare Incentives.--
            (1) In general.--Section 1886 of the Social Security Act 
        (42 U.S.C. 1395ww) is amended by adding at the end the 
        following new subsection:
    ``(j) Payment Incentives to Encourage Medical Malpractice Liability 
Reform.--
            ``(1) Reduction in payments for hospitals located in 
        certain states.--Notwithstanding any other provision of this 
        title, the Secretary shall reduce each payment amount otherwise 
        determined under this section by 1 percent for discharges 
        during a cost reporting period with respect to hospitals that 
        are not located in a State which the Secretary certifies 
        (pursuant to section 204 of the Savings Through Health 
        Protocols and Malpractice Reform Act of 1993) meets the 
        requirements of section 202 of the Savings Through Health 
        Protocols and Malpractice Reform Act of 1993 for the cost 
        reporting period.
            ``(2) Additional payment for hospitals located in states 
        enacting reforms.--With respect to hospitals that are not 
        subject to a reduction in payment under paragraph (1), the 
        Secretary shall make an additional payment for discharges 
        during a cost reporting period equal to the product of--
                    ``(A) an amount equal to the total of all amounts 
                that were not paid to hospitals during the cost 
                reporting period as a result of the reductions made 
                under such paragraph; and
                    ``(B) a percentage equal to the percentage of all 
                payments under this section during the year to all 
                hospitals that are not subject to the reduction 
                described in such paragraph that is attributable to 
                payments to that hospital.''.
            (2) Effective date.--The amendment made by paragraph (1) 
        shall apply with respect to discharges for cost reporting 
        periods beginning on or after the first day of the first fiscal 
        year that begins after the expiration of the 3-year period 
        beginning on the date of the enactment of this Act.
    (b) Medicaid Incentives.--
            (1) In general.--Section 1903 of the Social Security Act 
        (42 U.S.C. 1396b) is amended by inserting after subsection (r) 
        the following new subsection:
    ``(s)(1)(A) In order for a State to receive payments under 
paragraph (7) of subsection (a) for quarters in a year without being 
subject to the reduction described in subparagraph (B), the Secretary 
must certify (pursuant to section 204 of the Savings Through Health 
Protocols and Malpractice Reform Act of 1993) that the State meets the 
requirements of section 202 of the Savings Through Health Protocols and 
Malpractice Reform Act of 1993 for the year.
    ``(B) If a State is not certified for a year by the Secretary under 
subparagraph (A), the per centum specified in paragraph (7) of 
subsection (a) with respect to the State shall be reduced by 2 
percentage points for quarters during the year.
    ``(2) In the case of a State that is not subject to the reduction 
described in paragraph (1)(B) for quarters during a year, the Secretary 
shall make an additional payment to the State equal to the product of--
            ``(A) an amount equal to the total of all amounts that were 
        not paid to States during the year as a result of the 
        reductions made under such paragraph; and
            ``(B) a percentage equal to the percentage of all payments 
        under this section during the year to all States that are not 
        subject to the reduction described in such paragraph that is 
        attributable to payments to that State.''.
            (2) Effective date.--The amendment made by paragraph (1) 
        shall apply to calendar quarters beginning on or after the 
        first January 1 that begins after the expiration of the 3-year 
        period beginning on the date of the enactment of this Act.

SEC. 206. APPLICABILITY OF CERTAIN PROVISIONS TO FEDERAL TORT CLAIMS 
              ACT.

    (a) In General.--Chapter 171 of title 28, United States Code, is 
amended by adding at the end the following new section:
``Sec. 2681. Special rules for health care liability actions
    ``(a) Notwithstanding any other provision of this chapter, any 
action brought against the United States under this chapter that is a 
health care liability action shall be subject to the following:
            ``(1)(A) With respect to non-economic damages, the 
        liability of the United States shall be several only and shall 
        not be joint. The United States shall be liable only for the 
        amount of non-economic losses incurred by the plaintiff that is 
        in direct proportion to the United States' percentage of 
        responsibility for the injury suffered by the plaintiff (as 
        determined by the court pursuant to subparagraph (B)).
            ``(B) The court shall determine the extent of each 
        defendant's responsibility for the non-economic injury suffered 
        by the plaintiff, and shall assign a percentage of 
        responsibility for such injury to each defendant.
            ``(2)(A) The total amount of noneconomic damages that may 
        be awarded to an individual and the family members of such 
        individual for losses resulting from an injury which is the 
        subject of the action may not exceed $250,000, regardless of 
        the number of defendants against whom the action is brought or 
        the number of actions brought with respect to the injury.
            ``(B) The amount referred to in subparagraph (A) shall be 
        increased every 3rd year (beginning with the 3rd year that 
        begins after the date of the enactment of this section) in the 
        same manner as amounts are increased under section 215(i) of 
        the Social Security Act for base quarters or cost-of-living 
        computation quarters in such a year.
            ``(3)(A) The total amount of damages received by an 
        individual shall be reduced (in accordance with subparagraph 
        (B)) by any other payment that has been or will be made to the 
        individual to compensate the individual for the injury that was 
        the subject of the action, including payment under--
                    ``(i) Federal or State disability or sickness 
                programs;
                    ``(ii) Federal, State, or private health insurance 
                programs;
                    ``(iii) private disability insurance programs;
                    ``(iv) employer wage continuation programs; and
                    ``(v) any other source of payment intended to 
                compensate such individual for such injury.
            ``(B) The amount by which an award of damages to an 
        individual shall be reduced under subparagraph (A) shall be the 
        total amount of any payments (other than such award) that have 
        been made or that will be made to the individual to compensate 
        the individual for the injury that was the subject of the 
        action.
    ``(b) In this section, the following definitions shall apply:
            ``(1) The term `economic damages' means damages paid to 
        compensate an individual for medical expenses, lost wages or 
        other income, lost employment, burial expenses, and other 
        pecuniary losses.
            ``(2) The term `health care liability action' means a civil 
        action brought against the United States (regardless of the 
        theory of liability on which the action is based) in which a 
        plaintiff alleges an injury caused by the provision of (or the 
        failure to provide) health care services, except that such term 
        does not include--
                    ``(A) any action in which a plaintiff alleges an 
                intentional tort; or
                    ``(B) any action in which the plaintiff's sole 
                allegation is an allegation of an injury arising from 
                the use of a medical product.
            ``(3) The term `injury' means any illness, disease, or 
        other harm that is the subject of a health care liability 
        action.
            ``(4) The term `non-economic damages' means any damages 
        paid to compensate an individual for subjective, non-monetary 
        losses, including pain, suffering, inconvenience, mental 
        suffering, emotional distress, loss of society and 
        companionship, loss of consortium, injury to reputation, and 
        humiliation, but does not include punitive damages.''.
    (b) Clerical Amendment.--The table of sections at the beginning of 
chapter 171 of title 28, United States Code, is amended by adding at 
the end the following new item:

``2681. Special rules for health care liability actions.''.
    (c) Effective Date.--The amendments made by subsections (a) and (b) 
shall apply to actions brought against the United States on or after 
the date of the enactment of this Act.

SEC. 207. RULES OF CONSTRUCTION.

    Nothing in this title may be construed to--
            (1) waive or affect any defense of sovereign immunity 
        asserted by any State under any law or by the United States;
            (2) preempt State choice-of-law rules with respect to 
        claims brought by a foreign nation or a citizen of a foreign 
        nation;
            (3) affect the right of any court to transfer venue, to 
        apply the law of a foreign nation, or to dismiss a claim of a 
        foreign nation or of a citizen of a foreign nation on the 
        ground of inconvenient forum;
            (4) create or vest jurisdiction in the district courts of 
        the United States over any health care liability action subject 
        to this Act (which is not otherwise properly in Federal 
        district court); or
            (5) prevent any State from enacting, adopting, or otherwise 
        having in effect more comprehensive or additional health care 
        liability reforms than those set forth in this title.

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HR 1192 IH----2