[Congressional Bills 104th Congress]
[From the U.S. Government Publishing Office]
[S. 454 Reported in Senate (RS)]





                                                       Calendar No. 110

104th CONGRESS

  1st Session

                                 S. 454

                          [Report No. 104-83]

_______________________________________________________________________

                                 A BILL

  To reform the health care liability system and improve health care 
 quality through the establishment of quality assurance programs, and 
                          for other purposes.

_______________________________________________________________________

                 May 16 (legislative day, May 15), 1995

                       Reported with an amendment





                                                       Calendar No. 110
104th CONGRESS
  1st Session
                                 S. 454

                          [Report No. 104-83]

  To reform the health care liability system and improve health care 
 quality through the establishment of quality assurance programs, and 
                          for other purposes.


_______________________________________________________________________


                   IN THE SENATE OF THE UNITED STATES

            February 16 (legislative day, January 30), 1995

    Mr. McConnell (for himself, Mr. Lieberman, and Mrs. Kassebaum) 
introduced the following bill; which was read twice and referred to the 
                 Committee on Labor and Human Resources

                 May 16 (legislative day, May 15), 1995

             Reported by Mrs. Kassebaum, with an amendment
 [Strike out all after the enacting clause and insert the part printed 
                               in italic]

_______________________________________________________________________

                                 A BILL


 
  To reform the health care liability system and improve health care 
 quality through the establishment of quality assurance programs, and 
                          for other purposes.
    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,
<DELETED>SECTION 1. SHORT TITLE; TABLE OF CONTENTS.</DELETED>

<DELETED>    (a) Short Title.--This Act may be cited as the ``Health 
Care Liability Reform and Quality Assurance Act of 1995''.</DELETED>
<DELETED>    (b) Table of Contents.--The table of contents is as 
follows:</DELETED>

<DELETED>Sec. 1. Short title; table of contents.
             <DELETED>TITLE I--HEALTH CARE LIABILITY REFORM

                 <DELETED>Subtitle A--Liability Reform

<DELETED>Sec. 101. Findings and purpose.
<DELETED>Sec. 102. Definitions.
<DELETED>Sec. 103. Applicability.
<DELETED>Sec. 104. Statute of limitations.
<DELETED>Sec. 105. Reform of punitive damages.
<DELETED>Sec. 106. Periodic payments.
<DELETED>Sec. 107. Scope of liability.
<DELETED>Sec. 108. Mandatory offsets for damages paid by a collateral 
                            source.
<DELETED>Sec. 109. Treatment of attorneys' fees and other costs.
<DELETED>Sec. 110. Obstetric cases.
<DELETED>Sec. 111. State-based alternative dispute resolution 
                            mechanisms.
<DELETED>Sec. 112. Requirement of certificate of merit.
           <DELETED>Subtitle B--Biomaterials Access Assurance

<DELETED>Sec. 121. Short title.
<DELETED>Sec. 122. Findings.
<DELETED>Sec. 123. Definitions.
<DELETED>Sec. 124. General requirements; applicability; preemption.
<DELETED>Sec. 125. Liability of biomaterials suppliers.
<DELETED>Sec. 126. Procedures for dismissal of civil actions against 
                            biomaterials suppliers.
                   <DELETED>Subtitle C--Applicability

<DELETED>Sec. 131. Applicability.
   <DELETED>TITLE II--PROTECTION OF THE HEALTH AND SAFETY OF PATIENTS

<DELETED>Sec. 201. Health care quality assurance program.
<DELETED>Sec. 202. Risk management programs.
<DELETED>Sec. 203. National practitioner data bank.
                    <DELETED>TITLE III--SEVERABILITY

<DELETED>Sec. 301. Severability.
        <DELETED>TITLE I--HEALTH CARE LIABILITY REFORM</DELETED>

            <DELETED>Subtitle A--Liability Reform</DELETED>

<DELETED>SEC. 101. FINDINGS AND PURPOSE.</DELETED>

<DELETED>    (a) Findings.--Congress finds the following:</DELETED>
        <DELETED>    (1) Effect on health care access and costs.--That 
        the civil justice system of the United States is a costly and 
        inefficient mechanism for resolving claims of health care 
        liability and compensating injured patients and that the 
        problems associated with the current system are having an 
        adverse impact on the availability of, and access to, health 
        care services and the cost of health care in this 
        country.</DELETED>
        <DELETED>    (2) Effect on interstate commerce.--That the 
        health care and insurance industries are industries affecting 
        interstate commerce and the health care liability litigation 
        systems existing throughout the United States affect interstate 
        commerce by contributing to the high cost of health care and 
        premiums for health care liability insurance purchased by 
        participants in the health care system.</DELETED>
        <DELETED>    (3) Effect on federal spending.--That the health 
        care liability litigation systems existing throughout the 
        United States have a significant effect on the amount, 
        distribution, and use of Federal funds because of--</DELETED>
                <DELETED>    (A) the large number of individuals who 
                receive health care benefits under programs operated or 
                financed by the Federal Government;</DELETED>
                <DELETED>    (B) the large number of individuals who 
                benefit because of the exclusion from Federal taxes of 
                the amounts spent to provide them with health insurance 
                benefits; and</DELETED>
                <DELETED>    (C) the large number of health care 
                providers who provide items or services for which the 
                Federal Government makes payments.</DELETED>
<DELETED>    (b) Purpose.--It is the purpose of this Act to implement 
reasonable, comprehensive, and effective health care liability reform 
that is designed to--</DELETED>
        <DELETED>    (1) ensure that individuals with meritorious 
        health care injury claims receive fair and adequate 
        compensation, including reasonable non-economic 
        damages;</DELETED>
        <DELETED>    (2) improve the availability of health care 
        service in cases in which health care liability actions have 
        been shown to be a factor in the decreased availability of 
        services; and</DELETED>
        <DELETED>    (3) improve the fairness and cost-effectiveness of 
        our current health care liability system to resolve disputes 
        over, and provide compensation for, health care liability by 
        reducing uncertainty and unpredictability in the amount of 
        compensation provided to injured individuals.</DELETED>

<DELETED>SEC. 102. DEFINITIONS.</DELETED>

<DELETED>    As used in this subtitle:</DELETED>
        <DELETED>    (1) Claimant.--The term ``claimant'' means any 
        person who commences a health care liability action, and any 
        person on whose behalf such an action is commenced, including 
        the decedent in the case of an action brought through or on 
        behalf of an estate.</DELETED>
        <DELETED>    (2) Clear and convincing evidence.--The term 
        ``clear and convincing evidence'' is that measure or degree of 
        proof that will produce in the mind of the trier of fact a firm 
        belief or conviction as to the truth of the allegations sought 
        to be established, except that such measure or degree of proof 
        is more than that required under preponderance of the evidence, 
        but less than that required for proof beyond a reasonable 
        doubt.</DELETED>
        <DELETED>    (3) Health care liability action.--The term 
        ``health care liability action'' means a civil action in a 
        State or Federal court--</DELETED>
                <DELETED>    (A) against a health care provider, health 
                care professional, or other defendant joined in the 
                action (regardless of the theory of liability on which 
                the action is based) in which the claimant alleges 
                injury related to the provision of, or the failure to 
                provide, health care services; or</DELETED>
                <DELETED>    (B) against a health care payor, a health 
                maintenance organization, insurance company, or any 
                other individual, organization, or entity that provides 
                payment for health care benefits in which the claimant 
                alleges that injury was caused by the payment for, or 
                the failure to make payment for, health care benefits, 
                except to the extent such actions are subject to the 
                Employee Retirement Income Security Act of 
                1974.</DELETED>
        <DELETED>    (4) Health care professional.--The term ``health 
        care professional'' means any individual who provides health 
        care services in a State and who is required by Federal or 
        State laws or regulations to be licensed, registered or 
        certified to provide such services or who is certified to 
        provide health care services pursuant to a program of 
        education, training and examination by an accredited 
        institution, professional board, or professional 
        organization.</DELETED>
        <DELETED>    (5) Health care provider.--The term ``health care 
        provider'' means any organization or institution that is 
        engaged in the delivery of health care items or services in a 
        State and that is required by Federal or State laws or 
        regulations to be licensed, registered or certified to engage 
        in the delivery of such items or services.</DELETED>
        <DELETED>    (6) Health care services.--The term ``health care 
        services'' means any services provided by a health care 
        professional or health care provider, or any individual working 
        under the supervision of a health care professional, that 
        relate to the diagnosis, prevention, or treatment of any 
        disease or impairment, or the assessment of the health of human 
        beings.</DELETED>
        <DELETED>    (7) Injury.--The term ``injury'' means any 
        illness, disease, or other harm that is the subject of a health 
        care liability action.</DELETED>
        <DELETED>    (8) Noneconomic losses.--The term ``noneconomic 
        losses'' means losses for physical and emotional pain, 
        suffering, inconvenience, physical impairment, mental anguish, 
        disfigurement, loss of enjoyment of life, loss of consortium, 
        and other nonpecuniary losses incurred by an individual with 
        respect to which a health care liability action is 
        brought.</DELETED>
        <DELETED>    (9) Punitive damages.--The term ``punitive 
        damages'' means damages awarded, for the purpose of punishment 
        or deterrence, and not for compensatory purposes, against a 
        health care provider, health care organization, or other 
        defendant in a health care liability action. Punitive damages 
        are neither economic nor noneconomic damages.</DELETED>
        <DELETED>    (10) Secretary.--The term ``Secretary'' means the 
        Secretary of Health and Human Services.</DELETED>

<DELETED>SEC. 103. APPLICABILITY.</DELETED>

<DELETED>    (a) In General.--Except as provided in subsection (c), 
this subtitle shall apply with respect to any health care liability 
action brought in any Federal or State court, except that this section 
shall not apply to an action for damages arising from a vaccine-related 
injury or death to the extent that title XXI of the Public Health 
Service Act applies to the action.</DELETED>
<DELETED>    (b) Preemption.--The provisions of this subtitle shall 
preempt any State law to the extent such law is inconsistent with the 
limitations contained in such provisions. The provisions of this 
subtitle shall not preempt any State law that--</DELETED>
        <DELETED>    (1) provides for defenses in addition to those 
        contained in this subtitle, places greater limitations on the 
        amount of attorneys' fees that can be collected, or otherwise 
        imposes greater restrictions on non-economic or punitive 
        damages than those provided in this subtitle;</DELETED>
        <DELETED>    (2) permits State officials to commence health 
        care liability actions as a representative of an individual; 
        or</DELETED>
        <DELETED>    (3) permits provider-based dispute 
        resolution.</DELETED>
<DELETED>    (c) Effect on Sovereign Immunity and Choice of Law or 
Venue.--Nothing in this subtitle shall be construed to--</DELETED>
        <DELETED>    (1) waive or affect any defense of sovereign 
        immunity asserted by any State under any provision of 
        law;</DELETED>
        <DELETED>    (2) waive or affect any defense of sovereign 
        immunity asserted by the United States;</DELETED>
        <DELETED>    (3) affect the applicability of any provision of 
        the Foreign Sovereign Immunities Act of 1976;</DELETED>
        <DELETED>    (4) preempt State choice-of-law rules with respect 
        to actions brought by a foreign nation or a citizen of a 
        foreign nation; or</DELETED>
        <DELETED>    (5) affect the right of any court to transfer 
        venue or to apply the law of a foreign nation or to dismiss an 
        action of a foreign nation or of a citizen of a foreign nation 
        on the ground of inconvenient forum.</DELETED>
<DELETED>    (d) Federal Court Jurisdiction Not Established on Federal 
Question Grounds.--Nothing in this subtitle shall be construed to 
establish any jurisdiction in the district courts of the United States 
over health care liability actions on the basis of sections 1331 or 
1337 of title 28, United States Code.</DELETED>

<DELETED>SEC. 104. STATUTE OF LIMITATIONS.</DELETED>

<DELETED>    A health care liability action that is subject to this Act 
may not be initiated unless a complaint with respect to such action is 
filed within the 2-year period beginning on the date on which the 
claimant discovered or, in the exercise of reasonable care, should have 
discovered the harm and its cause, except that such an action relating 
to a claimant under legal disability may be filed within 2 years after 
the date on which the disability ceases. If the commencement of a 
health care liability action is stayed or enjoined, the running of the 
statute of limitations under this section shall be suspended for the 
period of the stay or injunction.</DELETED>

<DELETED>SEC. 105. REFORM OF PUNITIVE DAMAGES.</DELETED>

<DELETED>    (a) Limitation.--With respect to a health care liability 
action, an award for punitive damages may only be made, if otherwise 
permitted by applicable law, if it is proven by clear and convincing 
evidence that the defendant--</DELETED>
        <DELETED>    (1) intended to injure the claimant for a reason 
        unrelated to the provision of health care services;</DELETED>
        <DELETED>    (2) understood the claimant was substantially 
        certain to suffer unnecessary injury, and in providing or 
        failing to provide health care services, the defendant 
        deliberately failed to avoid such injury; or</DELETED>
        <DELETED>    (3) acted with a conscious disregard of a 
        substantial and unjustifiable risk of unnecessary injury which 
        the defendant failed to avoid in a manner which constitutes a 
        gross deviation from the normal standard of conduct in such 
        circumstances.</DELETED>
<DELETED>    (b) Punitive Damages Not Permitted.--Notwithstanding the 
provisions of subsection (a), punitive damages may not be awarded 
against a defendant with respect to any health care liability action if 
no judgment for compensatory damages, including nominal damages (under 
$500), is rendered against the defendant.</DELETED>
<DELETED>    (c) Requirements for Pleading of Punitive Damages.--
</DELETED>
        <DELETED>    (1) In general.--No demand for punitive damages 
        shall be included in a health care liability action as 
        initially filed.</DELETED>
        <DELETED>    (2) Amended pleading.--A court may allow a 
        claimant to file an amended complaint or pleading for punitive 
        damages in a health care liability action if--</DELETED>
                <DELETED>    (A) the claimant submits a motion to amend 
                the complaint or pleading within the earlier of--
                </DELETED>
                        <DELETED>    (i) 2 years after the complaint or 
                        initial pleading is filed, or</DELETED>
                        <DELETED>    (ii) 9 months before the date the 
                        matter is first set for trial; and</DELETED>
                <DELETED>    (B) after a finding by a court upon review 
                of supporting and opposing affidavits or after a 
                hearing, that after weighing the evidence the claimant 
                has established by a substantial probability that the 
                claimant will prevail on the claim for punitive 
                damages.</DELETED>
<DELETED>    (d) Separate Proceeding.--</DELETED>
        <DELETED>    (1) In general.--At the request of any defendant 
        in a health care liability action, the trier of fact shall 
        consider in a separate proceeding--</DELETED>
                <DELETED>    (A) whether punitive damages are to be 
                awarded and the amount of such award, or</DELETED>
                <DELETED>    (B) the amount of punitive damages 
                following a determination of punitive 
                liability.</DELETED>
        <DELETED>    (2) Only relevant evidence admissible.--If a 
        defendant requests a separate proceeding under paragraph (1), 
        evidence relevant only to the claim of punitive damages in a 
        health care liability action, as determined by applicable State 
        law, shall be inadmissible in any proceeding to determine 
        whether compensatory damages are to be awarded.</DELETED>
<DELETED>    (e) Determining Amount of Punitive Damages.--In 
determining the amount of punitive damages in a health care liability 
action, the trier of fact shall consider only the following:</DELETED>
        <DELETED>    (1) The severity of the harm caused by the conduct 
        of the defendant.</DELETED>
        <DELETED>    (2) The duration of the conduct or any concealment 
        of it by the defendant.</DELETED>
        <DELETED>    (3) The profitability of the conduct of the 
        defendant.</DELETED>
        <DELETED>    (4) The number of products sold or medical 
        procedures rendered for compensation, as the case may be, by 
        the defendant of the kind causing the harm complained of by the 
        claimant.</DELETED>
        <DELETED>    (5) Awards of punitive or exemplary damages to 
        persons similarly situated to the claimant, when offered by the 
        defendant.</DELETED>
        <DELETED>    (6) Prospective awards of compensatory damages to 
        persons similarly situated to the claimant.</DELETED>
        <DELETED>    (7) Any criminal penalties imposed on the 
        defendant as a result of the conduct complained of by the 
        claimant, when offered by the defendant.</DELETED>
        <DELETED>    (8) The amount of any civil fines assessed against 
        the defendant as a result of the conduct complained of by the 
        claimant, when offered by the defendant.</DELETED>
<DELETED>    (f) Limitation Amount.--The amount of damages that may be 
awarded as punitive damages in any health care liability action shall 
not exceed 3 times the amount awarded to the claimant for the economic 
injury on which such claim is based, or $250,000, whichever is greater. 
This subsection shall be applied by the court and shall not be 
disclosed to the jury.</DELETED>
<DELETED>    (g) Restrictions Permitted.--Nothing in this section shall 
be construed to imply a right to seek punitive damages where none 
exists under Federal or State law.</DELETED>

<DELETED>SEC. 106. PERIODIC PAYMENTS.</DELETED>

<DELETED>    With respect to a health care liability action, no person 
may be required to pay more than $100,000 for future damages in a 
single payment of a damages award, but a person shall be permitted to 
make such payments of the award on a periodic basis. The periods for 
such payments shall be determined by the adjudicating body, based upon 
projections of future losses and shall be reduced to present value. The 
adjudicating body may waive the requirements of this section if such 
body determines that such a waiver is in the interests of 
justice.</DELETED>
<DELETED>SEC. 107. SCOPE OF LIABILITY.</DELETED>

<DELETED>    (a) In General.--With respect to punitive and noneconomic 
damages, the liability of each defendant in a health care liability 
action shall be several only and may not be joint. Such a defendant 
shall be liable only for the amount of punitive or noneconomic damages 
allocated to the defendant in direct proportion to such defendant's 
percentage of fault or responsibility for the injury suffered by the 
claimant.</DELETED>
<DELETED>    (b) Determination of Percentage of Liability.--The trier 
of fact in a health care liability action shall determine the extent of 
each defendant's fault or responsibility for injury suffered by the 
claimant, and shall assign a percentage of responsibility for such 
injury to each such defendant.</DELETED>
<DELETED>    (c) Prohibition on Vicarious Liability.--A defendant in a 
health care liability action may not be held vicariously liable for the 
direct actions or omissions of other individuals.</DELETED>

<DELETED>SEC. 108. MANDATORY OFFSETS FOR DAMAGES PAID BY A COLLATERAL 
              SOURCE.</DELETED>

<DELETED>    (a) In General.--With respect to a health care liability 
action, the total amount of damages received by an individual under 
such action shall be reduced, in accordance with subsection (b), by any 
other payment that has been, or will be, made to an individual to 
compensate such individual for the injury that was the subject of such 
action.</DELETED>
<DELETED>    (b) Amount of Reduction.--The amount by which an award of 
damages to an individual for an injury shall be reduced under 
subsection (a) shall be--</DELETED>
        <DELETED>    (1) the total amount of any payments (other than 
        such award) that have been made or that will be made to such 
        individual to pay costs of or compensate such individual for 
        the injury that was the subject of the action; minus</DELETED>
        <DELETED>    (2) the amount paid by such individual (or by the 
        spouse, parent, or legal guardian of such individual) to secure 
        the payments described in paragraph (1).</DELETED>
<DELETED>    (c) Pretrial Determination of Amounts From Collateral 
Services.--The reductions required under subsection (b)(2) shall be 
determined by the court in a pretrial proceeding. At such proceeding--
</DELETED>
        <DELETED>    (1) no evidence shall be admitted as to the amount 
        of any charge, payments, or damage for which a claimant--
        </DELETED>
                <DELETED>    (A) has received payment from a collateral 
                source or the obligation for which has been assured by 
                a third party; or</DELETED>
                <DELETED>    (B) is, or with reasonable certainty, will 
                be eligible to receive payment from a collateral source 
                of the obligation which will, with reasonable certainty 
                be assumed by a third party; and</DELETED>
        <DELETED>    (2) the jury, if any, shall be advised that--
        </DELETED>
                <DELETED>    (A) except for damages as to which the 
                court permits the introduction of evidence, the 
                claimant's medical expenses and lost income have been 
                or will be paid by a collateral source or third party; 
                and</DELETED>
                <DELETED>    (B) the claimant shall receive no award 
                for any damages that have been or will be paid by a 
                collateral source or third party.</DELETED>

<DELETED>SEC. 109. TREATMENT OF ATTORNEYS' FEES AND OTHER 
              COSTS.</DELETED>

<DELETED>    (a) Limitation on Amount of Contingency Fees.--</DELETED>
        <DELETED>    (1) In general.--An attorney who represents, on a 
        contingency fee basis, a claimant in a health care liability 
        action may not charge, demand, receive, or collect for services 
        rendered in connection with such action in excess of the 
        following amount recovered by judgment or settlement under such 
        action:</DELETED>
                <DELETED>    (A) 33</DELETED>\<DELETED>1/3</DELETED>\ 
                <DELETED>percent of the first $150,000 (or portion 
                thereof) recovered, based on after-tax recovery, 
                plus</DELETED>
                <DELETED>    (B) 25 percent of any amount in excess of 
                $150,000 recovered, based on after-tax 
                recovery.</DELETED>
        <DELETED>    (2) Calculation of periodic payments.--In the 
        event that a judgment or settlement includes periodic or future 
        payments of damages, the amount recovered for purposes of 
        computing the limitation on the contingency fee under paragraph 
        (1) shall be based on the cost of the annuity or trust 
        established to make the payments. In any case in which an 
        annuity or trust is not established to make such payments, such 
        amount shall be based on the present value of the 
        payments.</DELETED>
<DELETED>    (b) Contingency Fee Defined.--As used in this section, the 
term ``contingency fee'' means any fee for professional legal services 
which is, in whole or in part, contingent upon the recovery of any 
amount of damages, whether through judgment or settlement.</DELETED>

<DELETED>SEC. 110. OBSTETRIC CASES.</DELETED>

<DELETED>    With respect to a health care liability action relating to 
services provided during labor or the delivery of a baby, if the health 
care professional against whom the action is brought did not previously 
treat the pregnant woman for the pregnancy, the trier of fact may not 
find that the defendant committed malpractice and may not assess 
damages against the health care professional unless the malpractice is 
proven by clear and convincing evidence.</DELETED>

<DELETED>SEC. 111. STATE-BASED ALTERNATIVE DISPUTE RESOLUTION 
              MECHANISMS.</DELETED>

<DELETED>    (a) Application to Health Care Liability Claims under 
Health Plans.--Prior to or immediately following the commencement of 
any health care liability action, the parties shall participate in the 
alternative dispute resolution system administered by the State under 
subsection (b). Such participation shall be in lieu of any other 
provision of Federal or State law applicable to the parties prior to 
the commencement of the health care liability action.</DELETED>
<DELETED>    (b) Adoption of Mechanism by State.--Each State shall--
</DELETED>
        <DELETED>    (1) maintain or adopt at least one of the 
        alternative dispute resolution methods satisfying the 
        requirements specified under subsection (c) and (d) for the 
        resolution of health care liability claims arising from the 
        provision of (or failure to provide) health care services to 
        individuals enrolled in a health plan; and</DELETED>
        <DELETED>    (2) clearly disclose to enrollees in health plans 
        (and potential enrollees) the availability and procedures for 
        consumer grievances, including a description of the alternative 
        dispute resolution method or methods adopted under this 
        subsection.</DELETED>
<DELETED>    (c) Specification of Permissible Alternative Dispute 
Resolution Methods.--</DELETED>
        <DELETED>    (1) In general.--The Attorney General, in 
        consultation with the Secretary and the Administrative 
        Conference of the United States, shall, by regulation, develop 
        alternative dispute resolution methods for the use by States in 
        resolving health care liability claims under subsection (a). 
        Such methods shall include at least the following:</DELETED>
                <DELETED>    (A) Arbitration.--The use of arbitration, 
                a nonjury adversarial dispute resolution process which 
                may, subject to subsection (d), result in a final 
                decision as to facts, law, liability or damages. The 
                parties may elect binding arbitration.</DELETED>
                <DELETED>    (B) Mediation.--The use of mediation, a 
                settlement process coordinated by a neutral third party 
                without the ultimate rendering of a formal opinion as 
                to factual or legal findings.</DELETED>
                <DELETED>    (C) Early neutral evaluation.--The use of 
                early neutral evaluation, in which the parties make a 
                presentation to a neutral attorney or other neutral 
                evaluator for an assessment of the merits, to encourage 
                settlement. If the parties do not settle as a result of 
                assessment and proceed to trial, the neutral 
                evaluator's opinion shall be kept 
                confidential.</DELETED>
                <DELETED>    (D) Early offer and recovery mechanism.--
                </DELETED>
                        <DELETED>    (i) In general.--The use of early 
                        offer and recovery mechanisms under which a 
                        health care provider, health care organization, 
                        or any other alleged responsible defendant may 
                        offer to compensate a claimant for his or her 
                        reasonable economic damages, including future 
                        economic damages, less amounts available from 
                        collateral sources.</DELETED>
                        <DELETED>    (ii) Binding arbitration.--If, 
                        after an offer is made under clause (i), the 
                        claimant alleges that payment of economic 
                        damages under the offer has not been reasonably 
                        made, or the participants in the offer dispute 
                        their relative contributions to the payments to 
                        be made to the claimant, such disputes shall be 
                        resolved through binding arbitration in 
                        accordance with applicable rules and procedures 
                        established by the State involved.</DELETED>
        <DELETED>    (2) Standards for establishing methods.--In 
        developing alternative dispute resolution methods under 
        paragraph (1), the Attorney General shall assure that the 
        methods promote the resolution of health care liability claims 
        in a manner that--</DELETED>
                <DELETED>    (A) is affordable for the parties 
                involved;</DELETED>
                <DELETED>    (B) provides for timely resolution of 
                claims;</DELETED>
                <DELETED>    (C) provides for the consistent and fair 
                resolution of claims; and</DELETED>
                <DELETED>    (D) provides for reasonably convenient 
                access to dispute resolution for individuals enrolled 
                in plans.</DELETED>
        <DELETED>    (3) Waiver authority.--Upon application of a 
        State, the Attorney General, in consultation with the 
        Secretary, may grant the State the authority to fulfill the 
        requirement of subsection (b) by adopting a mechanism other 
        than a mechanism established by the Attorney General pursuant 
        to this subsection, except that such mechanism must meet the 
        standards set forth in paragraph (2).</DELETED>
<DELETED>    (d) Further Redress.--Except with respect to the claimant-
requested binding arbitration method set forth in subsection (c)(1)(A), 
a claimant who is dissatisfied with the determination reached as a 
result of an alternative dispute resolution method applied under this 
section may, after the final resolution of the claimant's claim under 
the method, initiate or resume a cause of action to seek damages or 
other redress with respect to the claim to the extent otherwise 
permitted under State law. State law shall govern the admissibility of 
results of any alternative dispute resolution procedure and all 
statements, offers, and other communications made during such 
procedures, at any subsequent trial. An individual who initiates or 
resumes a health care liability action shall only prevail if such 
individual proves each element of the action beyond a reasonable doubt, 
including proving that the defendant was grossly negligent or 
intentionally caused injury.</DELETED>

<DELETED>SEC. 112. REQUIREMENT OF CERTIFICATE OF MERIT.</DELETED>

<DELETED>    (a) Requiring Submission with Complaint.--Except as 
provided in subsection (b) and subject to the penalties of subsection 
(d), no health care liability action may be brought by any individual 
unless, at the time the individual commences such action, the 
individual or the individual's attorney submits an affidavit declaring 
that--</DELETED>
        <DELETED>    (1) the individual (or the individual's attorney) 
        has consulted and reviewed the facts of the claim with a 
        qualified specialist (as defined in subsection (c));</DELETED>
        <DELETED>    (2) the individual or the individual's attorney 
        has obtained a written report by a qualified specialist that 
        clearly identifies the individual and that includes the 
        specialist's determination that, based upon a review of the 
        available medical record and other relevant material, a 
        reasonable medical interpretation of the facts supports a 
        finding that the claim against the defendant is meritorious and 
        based on good cause; and</DELETED>
        <DELETED>    (3) on the basis of the qualified specialist's 
        review and consultation, the individual, and if represented, 
        the individual's attorney, have concluded that the claim is 
        meritorious and based on good cause.</DELETED>
<DELETED>    (b) Extension in Certain Instances.--</DELETED>
        <DELETED>    (1) In general.--Subject to paragraph (2), 
        subsection (a) shall not apply with respect to an individual 
        who brings a health care liability action</DELETED>
         without submitting an affidavit described in such subsection 
if--</DELETED>
                <DELETED>    (A) despite good faith efforts, the 
                individual is unable to obtain the written report 
                before the expiration of the applicable statute of 
                limitations;</DELETED>
                <DELETED>    (B) despite good faith efforts, at the 
                time the individual commences the action, the 
                individual has been unable to obtain medical records or 
                other information necessary, pursuant to any applicable 
                law, to prepare the written report requested; 
                or</DELETED>
                <DELETED>    (C) the court of competent jurisdiction 
                determines that the affidavit requirement shall be 
                extended upon a showing of good cause.</DELETED>
        <DELETED>    (2) Deadline for submission where extension 
        applies.--In the case of an individual who brings an action to 
        which paragraph (1) applies, the action shall be dismissed 
        unless the individual submits the affidavit described in 
        subsection (a) not later than--</DELETED>
                <DELETED>    (A) in the case of an action to which 
                subparagraph (A) of paragraph (1) applies, 90 days 
                after commencing the action; or</DELETED>
                <DELETED>    (B) in the case of an action to which 
                subparagraph (B) of paragraph (1) applies, 90 days 
                after obtaining the information described in such 
                subparagraph or when good cause for an extension no 
                longer exists.</DELETED>
<DELETED>    (c) Qualified Specialist Defined.--</DELETED>
        <DELETED>    (1) In general.--As used in subsection (a), the 
        term ``qualified specialist'' means, with respect to a health 
        care liability action, a health care professional who has 
        expertise in the same or substantially similar area of practice 
        to that involved in the action.</DELETED>
        <DELETED>    (2) Evidence of expertise.--For purposes of 
        paragraph (1), evidence of required expertise may include 
        evidence that the individual--</DELETED>
                <DELETED>    (A) practices (or has practiced) or 
                teaches (or has taught) in the same or substantially 
                similar area of health care or medicine to that 
                involved in the action; or</DELETED>
                <DELETED>    (B) is otherwise qualified by experience 
                or demonstrated competence in the relevant practice 
                area.</DELETED>
<DELETED>    (d) Sanctions for Submitting False Affidavit.--Upon the 
motion of any party or on its own initiative, the court in a health 
care liability action may impose a sanction on a party, the party's 
attorney, or both, for--</DELETED>
        <DELETED>    (1) any knowingly false statement made in an 
        affidavit described in subsection (a);</DELETED>
        <DELETED>    (2) making any false representations in order to 
        obtain a qualified specialist's report; or</DELETED>
        <DELETED>    (3) failing to have the qualified specialist's 
        written report in his or her custody and control;</DELETED>
<DELETED>and may require that the sanctioned party reimburse the other 
party to the action for costs and reasonable attorney's fees.</DELETED>

      <DELETED>Subtitle B--Biomaterials Access Assurance</DELETED>

<DELETED>SEC. 121. SHORT TITLE.</DELETED>

<DELETED>    This subtitle may be cited as the ``Biomaterials Access 
Assurance Act of 1995''.</DELETED>

<DELETED>SEC. 122. FINDINGS.</DELETED>

<DELETED>    Congress finds that--</DELETED>
        <DELETED>    (1) each year millions of citizens of the United 
        States depend on the availability of lifesaving or life-
        enhancing medical devices, many of which are permanently 
        implantable within the human body;</DELETED>
        <DELETED>    (2) a continued supply of raw materials and 
        component parts is necessary for the invention, development, 
        improvement, and maintenance of the supply of the 
        devices;</DELETED>
        <DELETED>    (3) most of the medical devices are made with raw 
        materials and component parts that--</DELETED>
                <DELETED>    (A) are not designed or manufactured 
                specifically for use in medical devices; and</DELETED>
                <DELETED>    (B) come in contact with internal human 
                tissue;</DELETED>
        <DELETED>    (4) the raw materials and component parts also are 
        used in a variety of nonmedical products;</DELETED>
        <DELETED>    (5) because small quantities of the raw materials 
        and component parts are used for medical devices, sales of raw 
        materials and component parts for medical devices constitute an 
        extremely small portion of the overall market for the raw 
        materials and medical devices;</DELETED>
        <DELETED>    (6) under the Federal Food, Drug, and Cosmetic Act 
        (21 U.S.C. 301 et seq.), manufacturers of medical devices are 
        required to demonstrate that the medical devices are safe and 
        effective, including demonstrating that the products are 
        properly designed and have adequate warnings or 
        instructions;</DELETED>
        <DELETED>    (7) notwithstanding the fact that raw materials 
        and component parts suppliers do not design, produce, or test a 
        final medical device, the suppliers</DELETED>
         have been the subject of actions alleging inadequate--
</DELETED>
                <DELETED>    (A) design and testing of medical devices 
                manufactured with materials or parts supplied by the 
                suppliers; or</DELETED>
                <DELETED>    (B) warnings related to the use of such 
                medical devices;</DELETED>
        <DELETED>    (8) even though suppliers of raw materials and 
        component parts have very rarely been held liable in such 
        actions, such suppliers have ceased supplying certain raw 
        materials and component parts for use in medical devices 
        because the costs associated with litigation in order to ensure 
        a favorable judgment for the suppliers far exceeds the total 
        potential sales revenues from sales by such suppliers to the 
        medical device industry;</DELETED>
        <DELETED>    (9) unless alternate sources of supply can be 
        found, the unavailability of raw materials and component parts 
        for medical devices will lead to unavailability of lifesaving 
        and life-enhancing medical devices;</DELETED>
        <DELETED>    (10) because other suppliers of the raw materials 
        and component parts in foreign nations are refusing to sell raw 
        materials or component parts for use in manufacturing certain 
        medical devices in the United States, the prospects for 
        development of new sources of supply for the full range of 
        threatened raw materials and component parts for medical 
        devices are remote;</DELETED>
        <DELETED>    (11) it is unlikely that the small market for such 
        raw materials and component parts in the United States could 
        support the large investment needed to develop new suppliers of 
        such raw materials and component parts;</DELETED>
        <DELETED>    (12) attempts to develop such new suppliers would 
        raise the cost of medical devices;</DELETED>
        <DELETED>    (13) courts that have considered the duties of the 
        suppliers of the raw materials and component parts have 
        generally found that the suppliers do not have a duty--
        </DELETED>
                <DELETED>    (A) to evaluate the safety and efficacy of 
                the use of a raw material or component part in a 
                medical device; and</DELETED>
                <DELETED>    (B) to warn consumers concerning the 
                safety and effectiveness of a medical device;</DELETED>
        <DELETED>    (14) attempts to impose the duties referred to in 
        subparagraphs (A) and (B) of paragraph (13) on suppliers of the 
        raw materials and component parts would cause more harm than 
        good by driving the suppliers to cease supplying manufacturers 
        of medical devices; and</DELETED>
        <DELETED>    (15) in order to safeguard the availability of a 
        wide variety of lifesaving and life-enhancing medical devices, 
        immediate action is needed--</DELETED>
                <DELETED>    (A) to clarify the permissible bases of 
                liability for suppliers of raw materials and component 
                parts for medical devices; and</DELETED>
                <DELETED>    (B) to provide expeditious procedures to 
                dispose of unwarranted suits against the suppliers in 
                such manner as to minimize litigation costs.</DELETED>

<DELETED>SEC. 123. DEFINITIONS.</DELETED>

<DELETED>    As used in this subtitle:</DELETED>
        <DELETED>    (1) Biomaterials supplier.--</DELETED>
                <DELETED>    (A) In general.--The term ``biomaterials 
                supplier'' means an entity that directly or indirectly 
                supplies a component part or raw material for use in 
                the manufacture of an implant.</DELETED>
                <DELETED>    (B) Persons included.--Such term includes 
                any person who--</DELETED>
                        <DELETED>    (i) has submitted master files to 
                        the Secretary for purposes of premarket 
                        approval of a medical device; or</DELETED>
                        <DELETED>    (ii) licenses a biomaterials 
                        supplier to produce component parts or raw 
                        materials.</DELETED>
        <DELETED>    (2) Claimant.--</DELETED>
                <DELETED>    (A) In general.--The term ``claimant'' 
                means any person who brings a civil action, or on whose 
                behalf a civil action is brought, arising from harm 
                allegedly caused directly or indirectly by an implant, 
                including a person other than the individual into whose 
                body, or in contact with whose blood or tissue, the 
                implant is placed, who claims to have suffered harm as 
                a result of the implant.</DELETED>
                <DELETED>    (B) Action brought on behalf of an 
                estate.--With respect to an action brought on behalf or 
                through the estate of an individual into whose body, or 
                in contact with whose blood or tissue the implant is 
                placed, such term includes the decedent that is the 
                subject of the action.</DELETED>
                <DELETED>    (C) Action brought on behalf of a minor.--
                With respect to an action brought on behalf or through 
                a minor, such term includes the parent or guardian of 
                the minor.</DELETED>
                <DELETED>    (D) Exclusions.--Such term does not 
                include--</DELETED>
                        <DELETED>    (i) a provider of professional 
                        services, in any case in which--</DELETED>
                                <DELETED>    (I) the sale or use of an 
                                implant is incidental to the 
                                transaction; and</DELETED>
                                <DELETED>    (II) the essence of the 
                                transaction is the furnishing of 
                                judgment, skill, or services; 
                                or</DELETED>
                        <DELETED>    (ii) a manufacturer, seller, or 
                        biomaterials supplier.</DELETED>
        <DELETED>    (3) Component part.--</DELETED>
                <DELETED>    (A) In general.--The term ``component 
                part'' means a manufactured piece of an 
                implant.</DELETED>
                <DELETED>    (B) Certain components.--Such term 
                includes a manufactured piece of an implant that--
                </DELETED>
                        <DELETED>    (i) has significant nonimplant 
                        applications; and</DELETED>
                        <DELETED>    (ii) alone, has no implant value 
                        or purpose, but when combined with other 
                        component parts and materials, constitutes an 
                        implant.</DELETED>
        <DELETED>    (4) Harm.--</DELETED>
                <DELETED>    (A) In general.--The term ``harm'' means--
                </DELETED>
                        <DELETED>    (i) any injury to or damage 
                        suffered by an individual;</DELETED>
                        <DELETED>    (ii) any illness, disease, or 
                        death of that individual resulting from that 
                        injury or damage; and</DELETED>
                        <DELETED>    (iii) any loss to that individual 
                        or any other individual resulting from that 
                        injury or damage.</DELETED>
                <DELETED>    (B) Exclusion.--The term does not include 
                any commercial loss or loss of or damage to an 
                implant.</DELETED>
        <DELETED>    (5) Implant.--The term ``implant'' means--
        </DELETED>
                <DELETED>    (A) a medical device that is intended by 
                the manufacturer of the device--</DELETED>
                        <DELETED>    (i) to be placed into a surgically 
                        or naturally formed or existing cavity of the 
                        body for a period of at least 30 days; 
                        or</DELETED>
                        <DELETED>    (ii) to remain in contact with 
                        bodily fluids or internal human tissue through 
                        a surgically produced opening for a period of 
                        less than 30 days; and</DELETED>
                <DELETED>    (B) suture materials used in implant 
                procedures.</DELETED>
        <DELETED>    (6) Manufacturer.--The term ``manufacturer'' means 
        any person who, with respect to an implant--</DELETED>
                <DELETED>    (A) is engaged in the manufacture, 
                preparation, propagation, compounding, or processing 
                (as defined in section 510(a)(1) of the Federal Food, 
                Drug, and Cosmetic Act (21 U.S.C. 360(a)(1)) of the 
                implant; and</DELETED>
                <DELETED>    (B) is required--</DELETED>
                        <DELETED>    (i) to register with the Secretary 
                        pursuant to section 510 of the Federal Food, 
                        Drug, and Cosmetic Act (21 U.S.C. 360) and the 
                        regulations issued under such section; 
                        and</DELETED>
                        <DELETED>    (ii) to include the implant on a 
                        list of devices filed with the Secretary 
                        pursuant to section 510(j) of such Act (21 
                        U.S.C. 360(j)) and the regulations issued under 
                        such section.</DELETED>
        <DELETED>    (7) Medical device.--The term ``medical device'' 
        means a device, as defined in section 201(h) of the Federal 
        Food, Drug, and Cosmetic Act (21 U.S.C. 321(h)).</DELETED>
        <DELETED>    (8) Qualified specialist.--With respect to an 
        action, the term ``qualified specialist'' means a person who is 
        qualified by knowledge, skill, experience, training, or 
        education in the specialty area that is the subject of the 
        action.</DELETED>
        <DELETED>    (9) Raw material.--The term ``raw material'' means 
        a substance or product that--</DELETED>
                <DELETED>    (A) has a generic use; and</DELETED>
                <DELETED>    (B) may be used in an application other 
                than an implant.</DELETED>
        <DELETED>    (10) Secretary.--The term ``Secretary'' means the 
        Secretary of Health and Human Services.</DELETED>
        <DELETED>    (11) Seller.--</DELETED>
                <DELETED>    (A) In general.--The term ``seller'' means 
                a person who, in the course of a business conducted for 
                that purpose, sells, distributes, leases, packages, 
                labels, or otherwise places an implant in the stream of 
                commerce.</DELETED>
                <DELETED>    (B) Exclusions.--The term does not 
                include--</DELETED>
                        <DELETED>    (i) a seller or lessor of real 
                        property;</DELETED>
                        <DELETED>    (ii) a provider of professional 
                        services, in any case in which the sale or use 
                        of an implant is incidental to the transaction 
                        and the essence of the transaction is the 
                        furnishing of judgment, skill, or services; 
                        or</DELETED>
                        <DELETED>    (iii) any person who acts in only 
                        a financial capacity with respect to the sale 
                        of an implant.</DELETED>

<DELETED>SEC. 124. GENERAL REQUIREMENTS; APPLICABILITY; 
              PREEMPTION.</DELETED>

<DELETED>    (a) General Requirements.--</DELETED>
        <DELETED>    (1) In general.--In any civil action covered by 
        this subtitle, a biomaterials supplier may raise any defense 
        set forth in section 125.</DELETED>
        <DELETED>    (2) Procedures.--Notwithstanding any other 
        provision of law, the Federal or State court in which a civil 
        action covered by this subtitle is pending shall, in connection 
        with a motion for dismissal or judgment based on a defense 
        described in paragraph (1), use the procedures set forth in 
        section 126.</DELETED>
<DELETED>    (b) Applicability.--</DELETED>
        <DELETED>    (1) In general.--Except as provided in paragraph 
        (2), notwithstanding any other provision of law, this subtitle 
        applies to any civil action brought by a claimant, whether in a 
        Federal or State court, against a manufacturer, seller, or 
        biomaterials supplier, on the basis of any legal theory, for 
        harm allegedly caused by an implant.</DELETED>
        <DELETED>    (2) Exclusion.--A civil action brought by a 
        purchaser of a medical device for use in providing professional 
        services against a manufacturer, seller, or biomaterials 
        supplier for loss or damage to an implant or for commercial 
        loss to the purchaser--</DELETED>
                <DELETED>    (A) shall not be considered an action that 
                is subject to this subtitle; and</DELETED>
                <DELETED>    (B) shall be governed by applicable 
                commercial or contract law.</DELETED>
<DELETED>    (c) Scope of Preemption.--</DELETED>
        <DELETED>    (1) In general.--This subtitle supersedes any 
        State law regarding recovery for harm caused by an implant and 
        any rule of procedure applicable to a civil action to recover 
        damages for such harm only to the extent that this subtitle 
        establishes a rule of law applicable to the recovery of such 
        damages.</DELETED>
        <DELETED>    (2) Applicability of other laws.--Any issue that 
        arises under this subtitle and that is not governed by a rule 
        of law applicable to the recovery of damages described in 
        paragraph (1) shall be governed by applicable Federal or State 
        law.</DELETED>
<DELETED>    (d) Statutory Construction.--Nothing in this subtitle may 
be construed--</DELETED>
        <DELETED>    (1) to affect any defense available to a defendant 
        under any other provisions of Federal or State law in an action 
        alleging harm caused by an implant; or</DELETED>
        <DELETED>    (2) to create a cause of action or Federal court 
        jurisdiction pursuant to section 1331 or 1337 of title 28, 
        United States Code, that otherwise would not exist under 
        applicable Federal or State law.</DELETED>

<DELETED>SEC. 125. LIABILITY OF BIOMATERIALS SUPPLIERS.</DELETED>

<DELETED>    (a) In General.--</DELETED>
        <DELETED>    (1) Exclusion from liability.--Except as provided 
        in paragraph (2), a biomaterials supplier shall not be liable 
        for harm to a claimant caused by an implant.</DELETED>
        <DELETED>    (2) Liability.--A biomaterials supplier that--
        </DELETED>
                <DELETED>    (A) is a manufacturer may be liable for 
                harm to a claimant described in subsection 
                (b);</DELETED>
                <DELETED>    (B) is a seller may be liable for harm to 
                a claimant described in subsection (c); and</DELETED>
                <DELETED>    (C) furnishes raw materials or component 
                parts that fail to meet applicable contractual 
                requirements or specifications may be liable for a harm 
                to a claimant described in subsection (d).</DELETED>
<DELETED>    (b) Liability as Manufacturer.--</DELETED>
        <DELETED>    (1) In general.--A biomaterials supplier may, to 
        the extent required and permitted by any other applicable law, 
        be liable for harm to a claimant caused by an implant if the 
        biomaterials supplier is the manufacturer of the 
        implant.</DELETED>
        <DELETED>    (2) Grounds for liability.--The biomaterials 
        supplier may be considered the manufacturer of the implant that 
        allegedly caused harm to a claimant only if the biomaterials 
        supplier--</DELETED>
                <DELETED>    (A)(i) has registered with the Secretary 
                pursuant to section 510 of the Federal Food, Drug, and 
                Cosmetic Act (21 U.S.C. 360) and the regulations issued 
                under such section; and</DELETED>
                <DELETED>    (ii) included the implant on a list of 
                devices filed with the Secretary pursuant to section 
                510(j) of such Act (21 U.S.C. 360(j)) and the 
                regulations issued under such section; or</DELETED>
                <DELETED>    (B) is the subject of a declaration issued 
                by the Secretary pursuant to paragraph (3) that states 
                that the supplier, with respect to the implant that 
                allegedly caused harm to the claimant, was required 
                to--</DELETED>
                        <DELETED>    (i) register with the Secretary 
                        under section 510 of such Act (21 U.S.C. 360), 
                        and the regulations issued under such section, 
                        but failed to do so; or</DELETED>
                        <DELETED>    (ii) include the implant on a list 
                        of devices filed with the Secretary pursuant to 
                        section 510(j) of such Act (21 U.S.C. 360(j)) 
                        and the regulations issued under such section, 
                        but failed to do so.</DELETED>
        <DELETED>    (3) Administrative procedures.--</DELETED>
                <DELETED>    (A) In general.--The Secretary may issue a 
                declaration described in paragraph (2)(B) on the motion 
                of the Secretary or on petition by any person, after 
                providing--</DELETED>
                        <DELETED>    (i) notice to the affected 
                        persons; and</DELETED>
                        <DELETED>    (ii) an opportunity for an 
                        informal hearing.</DELETED>
                <DELETED>    (B) Docketing and final decision.--
                Immediately upon receipt of a petition filed pursuant 
                to this paragraph, the Secretary shall docket the 
                petition. Not later than 180 days after the petition is 
                filed, the Secretary shall issue a final decision on 
                the petition.</DELETED>
                <DELETED>    (C) Applicability of statute of 
                limitations.--Any applicable statute of limitations 
                shall toll during the period during which a claimant 
                has filed a petition with the Secretary under this 
                paragraph.</DELETED>
<DELETED>    (c) Liability as Seller.--A biomaterials supplier may, to 
the extent required and permitted by any other applicable law, be 
liable as a seller for harm to a claimant caused by an implant if the 
biomaterials supplier--</DELETED>
        <DELETED>    (1) held title to the implant that allegedly 
        caused harm to the claimant as a result of purchasing the 
        implant after--</DELETED>
                <DELETED>    (A) the manufacture of the implant; 
                and</DELETED>
                <DELETED>    (B) the entrance of the implant in the 
                stream of commerce; and</DELETED>
        <DELETED>    (2) subsequently resold the implant.</DELETED>
<DELETED>    (d) Liability for Violating Contractual Requirements or 
Specifications.--A biomaterials supplier may, to the extent required 
and permitted by any other applicable law, be liable for harm to a 
claimant caused by an implant, if the claimant in an action shows, by a 
preponderance of the evidence, that--</DELETED>
        <DELETED>    (1) the raw materials or component parts delivered 
        by the biomaterials supplier either--</DELETED>
                <DELETED>    (A) did not constitute the product 
                described in the contract between the biomaterials 
                supplier and the person who contracted for delivery of 
                the product; or</DELETED>
                <DELETED>    (B) failed to meet any specifications that 
                were--</DELETED>
                        <DELETED>    (i) provided to the biomaterials 
                        supplier and not expressly repudiated by the 
                        biomaterials supplier prior to acceptance of 
                        delivery of the raw materials or component 
                        parts;</DELETED>
                        <DELETED>    (ii)(I) published by the 
                        biomaterials supplier;</DELETED>
                        <DELETED>    (II) provided to the manufacturer 
                        by the biomaterials supplier; or</DELETED>
                        <DELETED>    (III) contained in a master file 
                        that was submitted by the biomaterials supplier 
                        to the Secretary and that is currently 
                        maintained by the biomaterials supplier for 
                        purposes of premarket approval of medical 
                        devices; or</DELETED>
                        <DELETED>    (iii)(I) included in the 
                        submissions for purposes of premarket approval 
                        or review by the Secretary under section 510, 
                        513, 515, or 520 of the Federal Food, Drug, and 
                        Cosmetic Act (21 U.S.C. 360, 360c, 360e, or 
                        360j); and</DELETED>
                        <DELETED>    (II) have received clearance from 
                        the Secretary,</DELETED>
                <DELETED>if such specifications were provided by the 
                manufacturer to the biomaterials supplier and were not 
                expressly repudiated by the biomaterials supplier prior 
                to the acceptance by the manufacturer of delivery of 
                the raw materials or component parts; and</DELETED>
        <DELETED>    (2) such conduct was an actual and proximate cause 
        of the harm to the claimant.</DELETED>

<DELETED>SEC. 126. PROCEDURES FOR DISMISSAL OF CIVIL ACTIONS AGAINST 
              BIOMATERIALS SUPPLIERS.</DELETED>

<DELETED>    (a) Motion To Dismiss.--In any action that is subject to 
this subtitle, a biomaterials supplier who is a defendant in such 
action may, at any time during which a motion to dismiss may be filed 
under an applicable law, move to dismiss the action on the grounds 
that--</DELETED>
        <DELETED>    (1) the defendant is a biomaterials supplier; 
        and</DELETED>
        <DELETED>    (2)(A) the defendant should not, for the purposes 
        of--</DELETED>
                <DELETED>    (i) section 125(b), be considered to be a 
                manufacturer of the implant that is subject to such 
                section; or</DELETED>
                <DELETED>    (ii) section 125(c), be considered to be a 
                seller of the implant that allegedly caused harm to the 
                claimant; or</DELETED>
        <DELETED>    (B)(i) the claimant has failed to establish, 
        pursuant to section 125(d), that the supplier furnished raw 
        materials or component parts in violation of contractual 
        requirements or specifications; or</DELETED>
        <DELETED>    (ii) the claimant has failed to comply with the 
        procedural requirements of subsection (b).</DELETED>
<DELETED>    (b) Procedural Requirements.--</DELETED>
        <DELETED>    (1) In general.--The procedural requirements 
        described in paragraphs (2) and (3) shall apply to any action 
        by a claimant against a biomaterials supplier that is subject 
        to this subtitle.</DELETED>
        <DELETED>    (2) Manufacturer of implant shall be named a 
        party.--The claimant shall be required to name the manufacturer 
        of the implant as a party to the action, unless--</DELETED>
                <DELETED>    (A) the manufacturer is subject to service 
                of process solely in a jurisdiction in which the 
                biomaterials supplier is not domiciled or subject to a 
                service of process; or</DELETED>
                <DELETED>    (B) an action against the manufacturer is 
                barred by applicable law.</DELETED>
        <DELETED>    (3) Affidavit.--At the time the claimant brings an 
        action against a biomaterials supplier the claimant shall be 
        required to submit an affidavit that--</DELETED>
                <DELETED>    (A) declares that the claimant has 
                consulted and reviewed the facts of the action with a 
                qualified specialist, whose qualifications the claimant 
                shall disclose;</DELETED>
                <DELETED>    (B) includes a written determination by a 
                qualified specialist that the raw materials or 
                component parts actually used in the manufacture of the 
                implant of the claimant were raw materials or component 
                parts described in section 125(d)(1), together with a 
                statement of the basis for such a 
                determination;</DELETED>
                <DELETED>    (C) includes a written determination by a 
                qualified specialist that, after a review of the 
                medical record and other relevant material, the raw 
                material or component part supplied by the biomaterials 
                supplier and actually used in the manufacture of the 
                implant was a cause of the harm alleged by claimant, 
                together with a statement of the basis for the 
                determination; and</DELETED>
                <DELETED>    (D) states that, on the basis of review 
                and consultation of the qualified specialist, the 
                claimant (or the attorney of the claimant) has 
                concluded that there is a reasonable and meritorious 
                cause for the filing of the action against the 
                biomaterials supplier.</DELETED>
<DELETED>    (c) Proceeding on Motion To Dismiss.--The following rules 
shall apply to any proceeding on a motion to dismiss filed under this 
section:</DELETED>
        <DELETED>    (1) Affidavits relating to listing and 
        declarations.--</DELETED>
                <DELETED>    (A) In general.--The defendant in the 
                action may submit an affidavit demonstrating that 
                defendant has not included the implant on a list, if 
                any, filed with the Secretary pursuant to section 
                510(j) of the Federal Food, Drug, and Cosmetic Act (21 
                U.S.C. 360(j)).</DELETED>
                <DELETED>    (B) Response to motion to dismiss.--In 
                response to the motion to dismiss, the claimant may 
                submit an affidavit demonstrating that--</DELETED>
                        <DELETED>    (i) the Secretary has, with 
                        respect to the defendant and the implant that 
                        allegedly caused harm to the claimant, issued a 
                        declaration pursuant to section 125(b)(2)(B); 
                        or</DELETED>
                        <DELETED>    (ii) the defendant who filed the 
                        motion to dismiss is a seller of the implant 
                        who is liable under section 125(c).</DELETED>
        <DELETED>    (2) Effect of motion to dismiss on discovery.--
        </DELETED>
                <DELETED>    (A) In general.--If a defendant files a 
                motion to dismiss under paragraph (1) or (3) of 
                subsection (a), no discovery shall be 
                permitted</DELETED>
                 in connection to the action that is the subject of the 
motion, other than discovery necessary to determine a motion to dismiss 
for lack of jurisdiction, until such time as the court rules on the 
motion to dismiss in accordance with the affidavits submitted by the 
parties in accordance with this section.</DELETED>
                <DELETED>    (B) Discovery.--If a defendant files a 
                motion to dismiss under subsection (a)(2) on the 
                grounds that the biomaterials supplier did not furnish 
                raw materials or component parts in violation of 
                contractual requirements or specifications, the court 
                may permit discovery, as ordered by the court. The 
                discovery conducted pursuant to this subparagraph shall 
                be limited to issues that are directly relevant to--
                </DELETED>
                        <DELETED>    (i) the pending motion to dismiss; 
                        or</DELETED>
                        <DELETED>    (ii) the jurisdiction of the 
                        court.</DELETED>
        <DELETED>    (3) Affidavits relating status of defendant.--
        </DELETED>
                <DELETED>    (A) In general.--Except as provided in 
                clauses (i) and (ii) of subparagraph (B), the court 
                shall consider a defendant to be a biomaterials 
                supplier who is not subject to an action for harm to a 
                claimant caused by an implant, other than an action 
                relating to liability for a violation of contractual 
                requirements or specifications described in subsection 
                (d).</DELETED>
                <DELETED>    (B) Responses to motion to dismiss.--The 
                court shall grant a motion to dismiss any action that 
                asserts liability of the defendant under subsection (b) 
                or (c) of section 125 on the grounds that the defendant 
                is not a manufacturer subject to such subsection 125(b) 
                or seller subject to subsection 125(c), unless the 
                claimant submits a valid affidavit that demonstrates 
                that--</DELETED>
                        <DELETED>    (i) with respect to a motion to 
                        dismiss contending the defendant is not a 
                        manufacturer, the defendant meets the 
                        applicable requirements for liability as a 
                        manufacturer under section 125(b); or</DELETED>
                        <DELETED>    (ii) with respect to a motion to 
                        dismiss contending that the defendant is not a 
                        seller, the defendant meets the applicable 
                        requirements for liability as a seller under 
                        section 125(c).</DELETED>
        <DELETED>    (4) Basis of ruling on motion to dismiss.--
        </DELETED>
                <DELETED>    (A) In general.--The court shall rule on a 
                motion to dismiss filed under subsection (a) solely on 
                the basis of the pleadings of the parties made pursuant 
                to this section and any affidavits submitted by the 
                parties pursuant to this section.</DELETED>
                <DELETED>    (B) Motion for summary judgment.--
                Notwithstanding any other provision of law, if the 
                court determines that the pleadings and affidavits made 
                by parties pursuant to this section raise genuine 
                issues as concerning material facts with respect to a 
                motion concerning contractual requirements and 
                specifications, the court may deem the motion to 
                dismiss to be a motion for summary judgment made 
                pursuant to subsection (d).</DELETED>
<DELETED>    (d) Summary Judgment.--</DELETED>
        <DELETED>    (1) In general.--</DELETED>
                <DELETED>    (A) Basis for entry of judgment.--A 
                biomaterials supplier shall be entitled to entry of 
                judgment without trial if the court finds there is no 
                genuine issue as concerning any material fact for each 
                applicable element set forth in paragraphs (1) and (2) 
                of section 125(d).</DELETED>
                <DELETED>    (B) Issues of material fact.--With respect 
                to a finding made under subparagraph (A), the court 
                shall consider a genuine issue of material fact to 
                exist only if the evidence submitted by claimant would 
                be sufficient to allow a reasonable jury to reach a 
                verdict for the claimant if the jury found the evidence 
                to be credible.</DELETED>
        <DELETED>    (2) Discovery made prior to a ruling on a motion 
        for summary judgment.--If, under applicable rules, the court 
        permits discovery prior to a ruling on a motion for summary 
        judgment made pursuant to this subsection, such discovery shall 
        be limited solely to establishing whether a genuine issue of 
        material fact exists.</DELETED>
        <DELETED>    (3) Discovery with respect to a biomaterials 
        supplier.--A biomaterials supplier shall be subject to 
        discovery in connection with a motion seeking dismissal or 
        summary judgment on the basis of the inapplicability of section 
        125(d) or the failure to establish the applicable elements of 
        section 125(d) solely to the extent permitted by the applicable 
        Federal or State rules for discovery against 
        nonparties.</DELETED>
<DELETED>    (e) Stay Pending Petition for Declaration.--If a claimant 
has filed a petition for a declaration pursuant to section 125(b) with 
respect to a defendant, and the Secretary has not issued a final 
decision on the petition, the court shall stay all proceedings with 
respect to that defendant until such time as the Secretary has issued a 
final decision on the petition.</DELETED>
<DELETED>    (f) Manufacturer Conduct of Proceeding.--The manufacturer 
of an implant that is the subject of an action covered under this 
subtitle shall be permitted to file and conduct a proceeding on any 
motion for summary judgment or dismissal filed by a biomaterials 
supplier who is a defendant under this section if the manufacturer and 
any other defendant in such action enter into a valid and applicable 
contractual agreement under which the manufacturer agrees to bear the 
cost of such proceeding or to conduct such proceeding.</DELETED>
<DELETED>    (g) Attorney Fees.--The court shall require the claimant 
to compensate the biomaterials supplier (or a manufacturer appearing in 
lieu of a supplier pursuant to subsection (f)) for attorney fees and 
costs, if--</DELETED>
        <DELETED>    (1) the claimant named or joined the biomaterials 
        supplier; and</DELETED>
        <DELETED>    (2) the court found the claim against the 
        biomaterials supplier to be without merit and 
        frivolous.</DELETED>

              <DELETED>Subtitle C--Applicability</DELETED>

<DELETED>SEC. 131. APPLICABILITY.</DELETED>

<DELETED>    This title shall apply to all civil actions covered under 
this title that are commenced on or after the date of enactment of this 
Act, including any such action with respect to which the harm asserted 
in the action or the conduct that caused the harm occurred before the 
date of enactment of this Act.</DELETED>

       <DELETED>TITLE II--PROTECTION OF THE HEALTH AND SAFETY OF 
                           PATIENTS</DELETED>

<DELETED>SEC. 201. HEALTH CARE QUALITY ASSURANCE PROGRAM.</DELETED>

<DELETED>    (a) Fund.--Each State shall establish a health care 
quality assurance program, to be approved by the Secretary, and a fund 
consisting of such amounts as are transferred to the fund under 
subsection (b).</DELETED>
<DELETED>    (b) Transfer of Amounts.--Each State shall require that 50 
percent of all awards of punitive damages resulting from all health 
care liability actions in that State be transferred to the fund 
established under subsection (a) in the State.</DELETED>
<DELETED>    (c) Obligations from Fund.--The chief executive officer of 
a State shall obligate such sums as are available in the fund 
established in that State under subsection (a) to--</DELETED>
        <DELETED>    (1) license and certify health care professionals 
        in the State;</DELETED>
        <DELETED>    (2) implement health care quality assurance 
        programs; and</DELETED>
        <DELETED>    (3) carry out programs to reduce malpractice-
        related costs for health care providers volunteering to provide 
        health care services in medically underserved areas.</DELETED>

<DELETED>SEC. 202. RISK MANAGEMENT PROGRAMS.</DELETED>

<DELETED>    (a) Requirements for Providers.--Each State shall require 
each health care professional and health care provider providing 
services in the State to participate in a risk management program to 
prevent and provide early warning of practices which may result in 
injuries to patients or which otherwise may endanger patient 
safety.</DELETED>
<DELETED>    (b) Requirements for Insurers.--Each State shall require 
each entity which provides health care professional or provider 
liability insurance to health care professionals and health care 
providers in the State to--</DELETED>
        <DELETED>    (1) establish risk management programs based on 
        data available to such entity or sanction programs of risk 
        management for health care professionals and health care 
        providers provided by other entities; and</DELETED>
        <DELETED>    (2) require each such professional or provider, as 
        a condition of maintaining insurance, to participate in one 
        program described in paragraph (1) at least once in each 3-year 
        period.</DELETED>

<DELETED>SEC. 203. NATIONAL PRACTITIONER DATA BANK.</DELETED>

<DELETED>    Section 427 of the Health Care Quality Improvement Act of 
1986 (42 U.S.C. 11137) is amended--</DELETED>
        <DELETED>    (1) by redesignating subsections (b) through (d) 
        as subsections (c) through (e), respectively;</DELETED>
        <DELETED>    (2) by inserting after subsection (a), the 
        following new subsection:</DELETED>
<DELETED>    ``(b) Disclosure of Information.--The Secretary shall 
promulgate regulations providing for the disclosure of information 
reported to the Secretary under sections 422 and 423, upon request, to 
any individual.''; and</DELETED>
        <DELETED>    (3) in subsection (c) (as so redesignated)--
        </DELETED>
                <DELETED>    (A) in the first sentence of paragraph 
                (1), by striking ``under this part'' and inserting 
                ``under section 421''; and</DELETED>
                <DELETED>    (B) in paragraph (3), by striking 
                ``subsection (a)'' and inserting ``subsections (a) and 
                (b)''.</DELETED>
               <DELETED>TITLE III--SEVERABILITY</DELETED>

<DELETED>SEC. 301. SEVERABILITY.</DELETED>

<DELETED>    If any provision of this Act, an amendment made by this 
Act, or the application of such provision or amendment to any person or 
circumstance is held to be unconstitutional, the remainder of this Act, 
the amendments made by this Act, and the application of the provisions 
of such to any person or circumstance shall not be affected 
thereby.</DELETED>
SECTION 1. SHORT TITLE; TABLE OF CONTENTS.

    (a) Short Title.--This Act may be cited as the ``Health Care 
Liability Reform and Quality Assurance Act of 1995''.
    (b) Table of Contents.--The table of contents is as follows:

Sec. 1. Short title; table of contents.

                 TITLE I--HEALTH CARE LIABILITY REFORM

                      Subtitle A--Liability Reform

Sec. 101. Findings and purpose.
Sec. 102. Definitions.
Sec. 103. Applicability.
Sec. 104. Statute of limitations.
Sec. 105. Reform of punitive damages.
Sec. 106. Periodic payments.
Sec. 107. Scope of liability.
Sec. 108. Mandatory offsets for damages paid by a collateral source.
Sec. 109. Treatment of attorneys' fees and other costs.
Sec. 110. State-based alternative dispute resolution mechanisms.

               Subtitle B--Biomaterials Access Assurance

Sec. 121. Short title.
Sec. 122. Findings.
Sec. 123. Definitions.
Sec. 124. General requirements; applicability; preemption.
Sec. 125. Liability of biomaterials suppliers.
Sec. 126. Procedures for dismissal of civil actions against 
                            biomaterials suppliers.

                       Subtitle C--Applicability

Sec. 131. Applicability.

       TITLE II--PROTECTION OF THE HEALTH AND SAFETY OF PATIENTS

Sec. 201. Additional resources for State health care quality assurance 
                            and access activities.
Sec. 202. Quality assurance, patient safety, and consumer information.

                        TITLE III--SEVERABILITY

Sec. 301. Severability.
                 TITLE I--HEALTH CARE LIABILITY REFORM

                      Subtitle A--Liability Reform

SEC. 101. FINDINGS AND PURPOSE.

    (a) Findings.--Congress finds the following:
            (1) Effect on health care access and costs.--The civil 
        justice system of the United States is a costly and inefficient 
        mechanism for resolving claims of health care liability and 
        compensating injured patients and the problems associated with 
        the current system are having an adverse impact on the 
        availability of, and access to, health care services and the 
        cost of health care in the United States.
            (2) Effect on interstate commerce.--The health care and 
        insurance industries are industries affecting interstate 
        commerce and the health care liability litigation systems 
        existing throughout the United States affect interstate 
        commerce by contributing to the high cost of health care and 
        premiums for health care liability insurance purchased by 
        participants in the health care system.
            (3) Effect on federal spending.--The health care liability 
        litigation systems existing throughout the United States have a 
        significant effect on the amount, distribution, and use of 
        Federal funds because of--
                    (A) the large number of individuals who receive 
                health care benefits under programs operated or 
                financed by the Federal Government;
                    (B) the large number of individuals who benefit 
                because of the exclusion from Federal taxes of the 
                amounts spent to provide such individuals with health 
                insurance benefits; and
                    (C) the large number of health care providers who 
                provide items or services for which the Federal 
                Government makes payments.
    (b) Purpose.--It is the purpose of this Act to implement 
reasonable, comprehensive, and effective health care liability reform 
that is designed to--
            (1) ensure that individuals with meritorious health care 
        injury claims receive fair and adequate compensation;
            (2) improve the availability of health care service in 
        cases in which health care liability actions have been shown to 
        be a factor in the decreased availability of services; and
            (3) improve the fairness and cost-effectiveness of the 
        current health care liability system of the United States to 
        resolve disputes over, and provide compensation for, health 
        care liability by reducing uncertainty and unpredictability in 
        the amount of compensation provided to injured individuals.

SEC. 102. DEFINITIONS.

    As used in this subtitle:
            (1) Claimant.--The term ``claimant'' means any person who 
        commences a health care liability action, and any person on 
        whose behalf such an action is commenced, including the 
        decedent in the case of an action brought through or on behalf 
        of an estate.
            (2) Clear and convincing evidence.--The term ``clear and 
        convincing evidence'' means that measure or degree of proof 
        that will produce in the mind of the trier of fact a firm 
        belief or conviction as to the truth of the allegations sought 
        to be established, except that such measure or degree of proof 
        is more than that required under preponderance of the evidence, 
        but less than that required for proof beyond a reasonable 
        doubt.
            (3) Collateral source rule.--The term ``collateral source 
        rule'' means a rule, either statutorily established or 
        established at common law, that prevents the introduction of 
        evidence regarding collateral source benefits or that prohibits 
        the deduction of collateral source benefits from an award of 
        damages in a health care liability action.
            (4) Economic losses.--The term ``economic losses'' means 
        objectively verifiable monetary losses incurred as a result of 
        the provision of (or failure to provide or pay for) health care 
        services or the use of a medical product, including past and 
        future medical expenses, loss of past and future earnings, cost 
        of obtaining replacement services in the home (including child 
        care, transportation, food preparation, and household care), 
        cost of making reasonable accommodations to a personal 
        residence, loss of employment, and loss of business or 
        employment opportunities. Economic losses are neither 
        noneconomic losses nor punitive damages.
            (5) Health care liability action.--The term ``health care 
        liability action'' means a civil action against a health care 
        provider, health care professional, health plan, or other 
        defendant, including a right to legal or equitable 
        contribution, indemnity, subrogation, third-party claims, cross 
        claims, or counter-claims, in which the claimant alleges injury 
        related to the provision of, payment for, or the failure to 
        provide or pay for, health care services or medical products, 
        regardless of the theory of liability on which the action is 
        based. Such term does not include a product liability action, 
        except where such an action is brought as part of a broader 
        health care liability action.
            (6) Health plan.--The term ``health plan'' means any person 
        or entity which is obligated to provide or pay for health 
        benefits under any health insurance arrangement, including any 
        person or entity acting under a contract or arrangement to 
        provide, arrange for, or administer any health benefit.
            (7) Health care professional.--The term ``health care 
        professional'' means any individual who provides health care 
        services in a State and who is required by Federal or State 
        laws or regulations to be licensed, registered or certified to 
        provide such services or who is certified to provide health 
        care services pursuant to a program of education, training and 
        examination by an accredited institution, professional board, 
        or professional organization.
            (8) Health care provider.--The term ``health care 
        provider'' means any organization or institution that is 
        engaged in the delivery of health care items or services in a 
        State and that is required by Federal or State laws or 
        regulations to be licensed, registered or certified to engage 
        in the delivery of such items or services.
            (9) Health care services.--The term ``health care 
        services'' means any services provided by a health care 
        professional, health care provider, or health plan or any 
        individual working under the supervision of a health care 
        professional, that relate to the diagnosis, prevention, or 
        treatment of any disease or impairment, or the assessment of 
        the health of human beings.
            (10) Injury.--The term ``injury'' means any illness, 
        disease, or other harm that is the subject of a health care 
        liability action.
            (11) Medical product.--The term ``medical product'' means a 
        drug (as defined in section 201(g)(1) of the Federal Food, 
        Drug, and Cosmetic Act (21 U.S.C. 321(g)(1)) or a medical 
        device as defined in section 201(h) of such Act (21 U.S.C.
         321(h)), including any component or raw material used therein, 
but excluding health care services, as defined in paragraph (9).
            (12) Noneconomic losses.--The term ``noneconomic losses'' 
        means losses for physical and emotional pain, suffering, 
        inconvenience, physical impairment, mental anguish, 
        disfigurement, loss of enjoyment of life, loss of consortium, 
        loss of society or companionship (other than loss of domestic 
        services), and other nonpecuniary losses incurred by an 
        individual with respect to which a health care liability action 
        is brought. Noneconomic losses are neither economic losses nor 
        punitive damages.
            (13) Punitive damages.--The term ``punitive damages'' means 
        damages awarded, for the purpose of punishment or deterrence, 
        and not for compensatory purposes, against a health care 
        professional, health care provider, or other defendant in a 
        health care liability action. Punitive damages are neither 
        economic nor noneconomic damages.
            (14) Secretary.--The term ``Secretary'' means the Secretary 
        of Health and Human Services.
            (15) State.--The term ``State'' means each of the several 
        States of the United States, the District of Columbia, and the 
        Commonwealth of Puerto Rico.

SEC. 103. APPLICABILITY.

    (a) In General.--Except as provided in subsections (c) and (d), 
this subtitle shall apply with respect to any health care liability 
action brought in any Federal or State court, except that this subtitle 
shall not apply to an action for damages arising from a vaccine-related 
injury or death to the extent that title XXI of the Public Health 
Service Act applies to the action.
    (b) Preemption.--
            (1) In general.--The provisions of this subtitle shall 
        preempt any State law existing on, or enacted subsequent to, 
        the date of enactment of this Act, only to the extent that such 
        law is inconsistent with the limitations contained in such 
        provisions and shall not preempt State law to the extent that 
        such law--
                    (A) places greater restrictions on the amount of or 
                standards for awarding noneconomic or punitive damages;
                    (B) places greater limitations on the awarding of 
                attorneys fees for awards in excess of $150,000;
                    (C) permits a lower threshold for the periodic 
                payment of future damages;
                    (D) establishes a shorter period during which a 
                health care liability action may be initiated or a more 
                restrictive rule with respect to the time at which the 
                period of limitations begins to run; or
                    (E) implements collateral source rule reform that 
                either permits the introduction of evidence of 
                collateral source benefits or provides for the 
                mandatory offset of collateral source benefits from 
                damage awards.
            (2) Rules of construction.--The provisions of this subtitle 
        shall not be construed to preempt any State law that--
                    (A) permits State officials to commence health care 
                liability actions as a representative of an individual;
                    (B) permits provider-based dispute resolution;
                    (C) places a maximum limit on the total damages in 
                a health care liability action;
                    (D) places a maximum limit on the time in which a 
                health care liability action may be initiated; or
                    (E) provides for defenses in addition to those 
                contained in this Act.
    (c) State Option.--
            (1) In general.--With respect to a provision of this 
        subtitle, such provision shall not apply to a
         health care liability action involving parties that are 
residents of the same State if the action is brought in a court of that 
State and the State has enacted a law--
                    (A) specifically citing the authority of this 
                subsection; and
                    (B)(i) proclaiming that the State has determined 
                that such provision shall not apply to such actions; or
                    (ii) establishing provisions that specifically 
                contradict the provisions of this subtitle.
            (2) Multiple states.--With respect to a health care 
        liability action involving parties that are residents of more 
        than one State, if each such State has enacted a law described 
        in paragraph (1), the choice-of-law rules of each such State 
        shall govern the rules and procedures applicable in the action.
            (3) Corporate entity.--For purposes of this subsection, a 
        corporate entity shall be deemed to be a resident of the State 
        in which such entity is incorporated and the State in which the 
        principal place of business of the entity is located.
            (4) Rule of construction.--Nothing in this subsection shall 
        be construed as requiring a State to reenact any provision of 
        State law if such law existed on the date of enactment of this 
        Act and such law is not otherwise preempted under the 
        provisions of subsection (b).
    (d) Effect on Sovereign Immunity and Choice of Law or Venue.--
Nothing in this subtitle shall be construed to--
            (1) waive or affect any defense of sovereign immunity 
        asserted by any State under any provision of law;
            (2) waive or affect any defense of sovereign immunity 
        asserted by the United States;
            (3) affect the applicability of any provision of the 
        Foreign Sovereign Immunities Act of 1976;
            (4) preempt State choice-of-law rules with respect to 
        actions brought by a foreign nation or a citizen of a foreign 
        nation;
            (5) affect the right of any court to transfer venue or to 
        apply the law of a foreign nation or to dismiss an action of a 
        foreign nation or of a citizen of a foreign nation on the 
        ground of inconvenient forum; or
            (6) supersede any provision of Federal law.
    (e) Federal Court Jurisdiction Not Established on Federal Question 
Grounds.--Nothing in this subtitle shall be construed to establish any 
jurisdiction in the district courts of the United States over health 
care liability actions on the basis of section 1331 or 1337 of title 
28, United States Code.

SEC. 104. STATUTE OF LIMITATIONS.

    A health care liability action that is subject to this Act may not 
be initiated unless a complaint with respect to such action is filed 
within the 2-year period beginning on the date on which the claimant 
discovered or, in the exercise of reasonable care, should have 
discovered the injury and its cause, except that such an action 
relating to a claimant under legal disability may be filed within 2 
years after the date on which the disability ceases. If the 
commencement of a health care liability action is stayed or enjoined, 
the running of the statute of limitations under this section shall be 
suspended for the period of the stay or injunction.

SEC. 105. REFORM OF PUNITIVE DAMAGES.

    (a) Limitation.--With respect to a health care liability action, an 
award for punitive damages may only be made, if otherwise permitted by 
applicable law, if it is proven by clear and convincing evidence that 
the defendant--
            (1) intended to injure the claimant for a reason unrelated 
        to the provision of health care services;
            (2) understood the claimant was substantially certain to 
        suffer unnecessary injury, and in providing or failing to 
        provide health care services, the defendant deliberately failed 
        to avoid such injury; or
            (3) acted with a conscious, flagrant disregard of a 
        substantial and unjustifiable risk of unnecessary injury which 
        the defendant failed to avoid in a manner which constitutes a 
        gross deviation from the normal standard of conduct in such 
        circumstances.
    (b) Punitive Damages Not Permitted.--Notwithstanding the provisions 
of subsection (a), punitive damages may not be awarded against a 
defendant with respect to any health care liability action if no 
judgment for compensatory damages, including nominal damages (under 
$500), is rendered against the defendant.
    (c) Procedure for Determining Punitive Damages.--
            (1) In general.--In any health care liability action 
        subject to this subtitle in which punitive damages are 
        recoverable, the trier of fact shall determine, concurrent with 
        all other issues presented in such action, whether such damages 
        shall be allowed. If the trier of fact determines that such 
        damages are allowed, a separate proceeding shall be conducted 
        by the court to determine the amount of such damages to be 
        awarded.
            (2) Separate proceeding.--At a separate proceeding to 
        determine the amount of punitive damages to be awarded under 
        paragraph (1), the court shall consider the following:
                    (A) The severity of the harm caused by the conduct 
                of the defendant.
                    (B) The duration of the conduct or any concealment 
                of such conduct by the defendant.
                    (C) The profitability of the conduct of the 
                defendant.
                    (D) The number of products sold or medical 
                procedures rendered for compensation, as the case may 
                be, by the defendant of the kind causing the harm 
                complained of by the claimant.
                    (E) The total deterrent effect of other damages and 
                punishment imposed upon the defendant as a result of 
                the misconduct, including compensatory, exemplary and 
                punitive damage awards to individuals in situations 
                similar to those of the claimant and the severity of 
                any criminal or administrative penalties, or civil 
                fines, to which the defendant has been or may be 
                subjected.
            (3) Determination.--At the conclusion of a separate 
        proceeding under paragraph (1), the court shall determine the 
        amount of punitive damages to be awarded with respect to the 
        health care liability action involved and shall enter judgment 
        for that amount. The court shall clearly state its reasons for 
        setting the amount of such award in findings of fact and 
        conclusions of law, demonstrating consideration of each of the 
        factors described in paragraph (2).
    (d) Restrictions Permitted.--Nothing in this Act shall be construed 
to imply a right to seek punitive damages where none exists under 
Federal or State law.

SEC. 106. PERIODIC PAYMENTS.

    With respect to a health care liability action, if the award of 
future damages exceeds $100,000, the adjudicating body shall, at the 
request of either party, enter a judgment ordering that future damages 
be paid on a periodic basis in accordance with the guidelines contained 
in the Uniform Periodic Payments of Judgments Act, as promulgated by 
the National Conference of Commissioners on Uniform State Laws in July 
of 1990. The adjudicating body may waive the requirements of this 
section if such body determines that such a waiver is in the interests 
of justice.

SEC. 107. SCOPE OF LIABILITY.

    (a) In General.--With respect to punitive and noneconomic damages, 
the liability of each defendant in a health care liability action shall 
be several only and may not be joint. Such a defendant shall be liable 
only for the amount of punitive or noneconomic damages allocated to the 
defendant in direct proportion to such defendant's percentage of fault 
or responsibility for the injury suffered by the claimant.
    (b) Determination of Percentage of Liability.--With respect to 
punitive or noneconomic damages, the trier of fact in a health care 
liability action shall determine the extent of each party's fault or 
responsibility for injury suffered by the claimant, and shall assign a 
percentage of responsibility for such injury to each such party.

SEC. 108. MANDATORY OFFSETS FOR DAMAGES PAID BY A COLLATERAL SOURCE.

    (a) In General.--With respect to a health care liability action, 
the total amount of damages received by an individual under such action 
shall be reduced, in accordance with subsection (b), by any other 
payment that has been, or will be, made to an individual to compensate 
such individual for the injury that was the subject of such action.
    (b) Amount of Reduction.--The amount by which an award of damages 
to an individual for an injury shall be reduced under subsection (a) 
shall be--
            (1) the total amount of any payments (other than such 
        award) that have been made or that will be made to such 
        individual to pay costs of or compensate such individual for 
        the injury that was the subject of the action; minus
            (2) the amount paid by such individual (or by the spouse, 
        parent, or legal guardian of such individual) to secure the 
        payments described in paragraph (1).
    (c) Determination of Amounts From Collateral Services.--The 
reductions required under subsection (b) shall be determined by the 
court in a pretrial proceeding. At the subsequent trial--
            (1) no evidence shall be admitted as to the amount of any 
        charge, payments, or damage for which a claimant--
                    (A) has received payment from a collateral source 
                or the obligation for which has been assured by a third 
                party; or
                    (B) is, or with reasonable certainty, will be 
                eligible to receive payment from a collateral source of 
                the obligation which will, with reasonable certainty be 
                assumed by a third party; and
            (2) the jury, if any, shall be advised that--
                    (A) except for damages as to which the court 
                permits the introduction of evidence, the claimant's 
                medical expenses and lost income
                 have been or will be paid by a collateral source or 
third party; and
                    (B) the claimant shall receive no award for any 
                damages that have been or will be paid by a collateral 
                source or third party.

SEC. 109. TREATMENT OF ATTORNEYS' FEES AND OTHER COSTS.

    (a) Limitation on Amount of Contingency Fees.--
            (1) In general.--An attorney who represents, on a 
        contingency fee basis, a claimant in a health care liability 
        action may not charge, demand, receive, or collect for services 
        rendered in connection with such action in excess of the 
        following amount recovered by judgment or settlement under such 
        action:
                    (A) 33\1/3\ percent of the first $150,000 (or 
                portion thereof) recovered, based on after-tax 
                recovery, plus
                    (B) 25 percent of any amount in excess of $150,000 
                recovered, based on after-tax recovery.
            (2) Calculation of periodic payments.--In the event that a 
        judgment or settlement includes periodic or future payments of 
        damages, the amount recovered for purposes of computing the 
        limitation on the contingency fee under paragraph (1) shall be 
        based on the cost of the annuity or trust established to make 
        the payments. In any case in which an annuity or trust is not 
        established to make such payments, such amount shall be based 
        on the present value of the payments.
    (b) Contingency Fee Defined.--As used in this section, the term 
``contingency fee'' means any fee for professional legal services which 
is, in whole or in part, contingent upon the recovery of any amount of 
damages, whether through judgment or settlement.

SEC. 110. STATE-BASED ALTERNATIVE DISPUTE RESOLUTION MECHANISMS.

    (a) Establishment by States.--Each State is encouraged to establish 
or maintain alternative dispute resolution mechanisms that promote the 
resolution of health care liability claims in a manner that--
            (1) is affordable for the parties involved in the claims;
            (2) provides for the timely resolution of claims; and
            (3) provides the parties with convenient access to the 
        dispute resolution process.
    (b) Guidelines.--The Attorney General, in consultation with the 
Secretary and the Administrative Conference of the United States, shall 
develop guidelines with respect to alternative dispute resolution 
mechanisms that may be established by States for the resolution of 
health care liability claims. Such guidelines shall include procedures 
with respect to the following methods of alternative dispute 
resolution:
            (1) Arbitration.--The use of arbitration, a nonjury 
        adversarial dispute resolution process which may, subject to 
        subsection (c), result in a final decision as to facts, law, 
        liability or damages. The parties may elect binding 
        arbitration.
            (2) Mediation.--The use of mediation, a settlement process 
        coordinated by a neutral third party without the ultimate 
        rendering of a formal opinion as to factual or legal findings.
            (3) Early neutral evaluation.--The use of early neutral 
        evaluation, in which the parties make a presentation to a 
        neutral attorney or other neutral evaluator for an assessment 
        of the merits, to encourage settlement. If the parties do not 
        settle as a result of assessment and proceed to trial, the 
        neutral evaluator's opinion shall be kept confidential.
            (4) Early offer and recovery mechanism.--The use of early 
        offer and recovery mechanisms under which a health care 
        provider, health care organization, or any other alleged 
        responsible defendant may offer to compensate a claimant for 
        his or her reasonable economic damages, including future 
        economic damages, less amounts available from collateral 
        sources.
            (5) Certificate of merit.--The requirement that a claimant 
        in a health care liability action submit to the court before 
        trial a written report by a qualified specialist that includes 
        the specialist's determination that, after a review of the 
        available medical record and other relevant material, there is 
        a reasonable and meritorious cause for the filing of the action 
        against the defendant.
            (6) No fault.--The use of a no-fault statute under which 
        certain health care liability actions are barred and claimants 
        are compensated for injuries through their health plans or 
        through other appropriate mechanisms.
    (c) Further Redress.--
            (1) In general.--The extent to which any party may seek 
        further redress (subsequent to a decision of an alternative 
        dispute resolution method) concerning a health care liability 
        claim in a Federal or State court shall be dependent upon the 
        methods of alternative dispute resolution adopted by the State.
            (2) Claimant.--With respect to further redress described in 
        paragraph (1), if the party initiating such court action is the 
        claimant and the claimant receives a level of damages that is 
        at least 25 percent less under the decision of the court than 
        under the State alternative dispute resolution method, such 
        party shall bear the reasonable costs, including legal fees, 
        incurred in the court action by the other party or parties to 
        such action.
            (3) Provider or other defendant.--With respect to further 
        redress described in paragraph (1), if the party initiating a 
        court action is the health care professional, health care 
        provider health plan, or other defendant in a health care 
        liability action and the health care professional, health care 
        provider, health plan or other defendant is found liable for a 
        level of damages that is at least 25 percent more under the 
        decision of the court than under the State alternative dispute 
        resolution method, such party shall bear the reasonable costs, 
        including legal fees, incurred in the court action by the other 
        party or parties to such action.
    (d) Technical Assistance and Evaluations.--
            (1) Technical assistance.--The Attorney General may provide 
        States with technical assistance in establishing or maintaining 
        alternative dispute resolution mechanisms under this section.
            (2) Evaluations.--The Attorney General, in consultation 
        with the Secretary and the Administrative Conference of the 
        United States, shall monitor and evaluate the effectiveness of 
        State alternative dispute resolution mechanisms established or 
        maintained under this section.

               Subtitle B--Biomaterials Access Assurance

SEC. 121. SHORT TITLE.

    This subtitle may be cited as the ``Biomaterials Access Assurance 
Act of 1995''.

SEC. 122. FINDINGS.

    Congress finds that--
            (1) each year millions of citizens of the United States 
        depend on the availability of lifesaving or life-enhancing 
        medical devices, many of which are permanently implantable 
        within the human body;
            (2) a continued supply of raw materials and component parts 
        is necessary for the invention, development, improvement, and 
        maintenance of the supply of the devices;
            (3) most of the medical devices are made with raw materials 
        and component parts that--
                    (A) are not designed or manufactured specifically 
                for use in medical devices; and
                    (B) come in contact with internal human tissue;
            (4) the raw materials and component parts also are used in 
        a variety of nonmedical products;
            (5) because small quantities of the raw materials and 
        component parts are used for medical devices, sales of raw 
        materials and component parts for medical devices constitute an 
        extremely small portion of the overall market for the raw 
        materials and medical devices;
            (6) under the Federal Food, Drug, and Cosmetic Act (21 
        U.S.C. 301 et seq.), manufacturers of medical devices are 
        required to demonstrate that the medical devices are safe and 
        effective, including demonstrating that the products are 
        properly designed and have adequate warnings or instructions;
            (7) notwithstanding the fact that raw materials and 
        component parts suppliers do not design, produce, or test a 
        final medical device, the suppliers have been the subject of 
        actions alleging inadequate--
                    (A) design and testing of medical devices 
                manufactured with materials or parts supplied by the 
                suppliers; or
                    (B) warnings related to the use of such medical 
                devices;
            (8) even though suppliers of raw materials and component 
        parts have very rarely been held liable in such actions, such 
        suppliers have ceased supplying certain raw materials and 
        component parts for use in medical devices because the costs 
        associated with litigation in order to ensure a favorable 
        judgment for the suppliers far exceeds the total potential 
        sales revenues from sales by such suppliers to the medical 
        device industry;
            (9) unless alternate sources of supply can be found, the 
        unavailability of raw materials and component parts for medical 
        devices will lead to unavailability of lifesaving and life-
        enhancing medical devices;
            (10) because other suppliers of the raw materials and 
        component parts in foreign nations are refusing to sell raw 
        materials or component parts for use in manufacturing certain 
        medical devices in the United States, the prospects for 
        development of new sources of supply for the full range of 
        threatened raw materials and component parts for medical 
        devices are remote;
            (11) it is unlikely that the small market for such raw 
        materials and component parts in the United States could 
        support the large investment needed to develop new suppliers of 
        such raw materials and component parts;
            (12) attempts to develop such new suppliers would raise the 
        cost of medical devices;
            (13) courts that have considered the duties of the 
        suppliers of the raw materials and component parts have 
        generally found that the suppliers do not have a duty--
                    (A) to evaluate the safety and efficacy of the use 
                of a raw material or component part in a medical 
                device; and
                    (B) to warn consumers concerning the safety and 
                effectiveness of a medical device;
            (14) attempts to impose the duties referred to in 
        subparagraphs (A) and (B) of paragraph (13) on suppliers of the 
        raw materials and component parts would cause more harm than 
        good by driving the suppliers to cease supplying manufacturers 
        of medical devices; and
            (15) in order to safeguard the availability of a wide 
        variety of lifesaving and life-enhancing medical devices, 
        immediate action is needed--
                    (A) to clarify the permissible bases of liability 
                for suppliers of raw materials and component parts for 
                medical devices; and
                    (B) to provide expeditious procedures to dispose of 
                unwarranted suits against the suppliers in such manner 
                as to minimize litigation costs.

SEC. 123. DEFINITIONS.

    As used in this subtitle:
            (1) Biomaterials supplier.--
                    (A) In general.--The term ``biomaterials supplier'' 
                means an entity that directly or indirectly supplies a 
                component part or raw material for use in the 
                manufacture of an implant.
                    (B) Persons included.--Such term includes any 
                person who--
                            (i) has submitted master files to the 
                        Secretary for purposes of premarket approval of 
                        a medical device; or
                            (ii) licenses a biomaterials supplier to 
                        produce component parts or raw materials.
            (2) Claimant.--
                    (A) In general.--The term ``claimant'' means any 
                person who brings a civil action, or on whose behalf a 
                civil action is brought, arising from harm allegedly 
                caused directly or indirectly by an implant, including 
                a person other than the individual into whose body, or 
                in contact with whose blood or tissue, the implant is 
                placed, who claims to have suffered harm as a result of 
                the implant.
                    (B) Action brought on behalf of an estate.--With 
                respect to an action brought on behalf or through the 
                estate of an individual into whose body, or in contact 
                with whose blood or tissue the implant is placed, such 
                term includes the decedent that is the subject of the 
                action.
                    (C) Action brought on behalf of a minor.--With 
                respect to an action brought on behalf or through a 
                minor, such term includes the parent or guardian of the 
                minor.
                    (D) Exclusions.--Such term does not include--
                            (i) a provider of professional services, in 
                        any case in which--
                                    (I) the sale or use of an implant 
                                is incidental to the transaction; and
                                    (II) the essence of the transaction 
                                is the furnishing of judgment, skill, 
                                or services; or
                            (ii) a manufacturer, seller, or 
                        biomaterials supplier.
            (3) Component part.--
                    (A) In general.--The term ``component part'' means 
                a manufactured piece of an implant.
                    (B) Certain components.--Such term includes a 
                manufactured piece of an implant that--
                            (i) has significant nonimplant 
                        applications; and
                            (ii) alone, has no implant value or 
                        purpose, but when combined with other component 
                        parts and materials, constitutes an implant.
            (4) Harm.--
                    (A) In general.--The term ``harm'' means--
                            (i) any injury to or damage suffered by an 
                        individual;
                            (ii) any illness, disease, or death of that 
                        individual resulting from that injury or 
                        damage; and
                            (iii) any loss to that individual or any 
                        other individual resulting from that injury or 
                        damage.
                    (B) Exclusion.--The term does not include any 
                commercial loss or loss of or damage to an implant.
            (5) Implant.--The term ``implant'' means--
                    (A) a medical device that is intended by the 
                manufacturer of the device--
                            (i) to be placed into a surgically or 
                        naturally formed or existing cavity of the body 
                        for a period of at least 30 days; or
                            (ii) to remain in contact with bodily 
                        fluids or internal human tissue through a 
                        surgically produced opening for a period of 
                        less than 30 days; and
                    (B) suture materials used in implant procedures.
            (6) Manufacturer.--The term ``manufacturer'' means any 
        person who, with respect to an implant--
                    (A) is engaged in the manufacture, preparation, 
                propagation, compounding, or processing (as defined in 
                section 510(a)(1) of the Federal Food, Drug, and 
                Cosmetic Act (21 U.S.C. 360(a)(1)) of the implant; and
                    (B) is required--
                            (i) to register with the Secretary pursuant 
                        to section 510 of the Federal Food, Drug, and 
                        Cosmetic Act (21 U.S.C. 360) and the 
                        regulations issued under such section; and
                            (ii) to include the implant on a list of 
                        devices filed with the Secretary pursuant to 
                        section 510(j) of such Act (21 U.S.C. 360(j)) 
                        and the regulations issued under such section.
            (7) Medical device.--The term ``medical device'' means a 
        device, as defined in section 201(h) of the Federal Food, Drug, 
        and Cosmetic Act (21 U.S.C. 321(h)).
            (8) Qualified specialist.--With respect to an action, the 
        term ``qualified specialist'' means a person who is qualified 
        by knowledge, skill, experience, training, or education in the 
        specialty area that is the subject of the action.
            (9) Raw material.--The term ``raw material'' means a 
        substance or product that--
                    (A) has a generic use; and
                    (B) may be used in an application other than an 
                implant.
            (10) Secretary.--The term ``Secretary'' means the Secretary 
        of Health and Human Services.
            (11) Seller.--
                    (A) In general.--The term ``seller'' means a person 
                who, in the course of a business conducted for that 
                purpose, sells, distributes, leases, packages, labels, 
                or otherwise places an implant in the stream of 
                commerce.
                    (B) Exclusions.--The term does not include--
                            (i) a seller or lessor of real property;
                            (ii) a provider of professional services, 
                        in any case in which the sale or use of an 
                        implant is incidental to the transaction and 
                        the essence of the transaction is the 
                        furnishing of judgment, skill, or services; or
                            (iii) any person who acts in only a 
                        financial capacity with respect to the sale of 
                        an implant.

SEC. 124. GENERAL REQUIREMENTS; APPLICABILITY; PREEMPTION.

    (a) General Requirements.--
            (1) In general.--In any civil action covered by this 
        subtitle, a biomaterials supplier may raise any defense set 
        forth in section 125.
            (2) Procedures.--Notwithstanding any other provision of 
        law, the Federal or State court in which a civil action covered 
        by this subtitle is pending shall, in connection with a motion 
        for dismissal or judgment based on a defense described in 
        paragraph (1), use the procedures set forth in section 126.
    (b) Applicability.--
            (1) In general.--Except as provided in paragraph (2), 
        notwithstanding any other provision of law, this subtitle 
        applies to any civil action brought by a claimant, whether in a 
        Federal or State court, against a manufacturer, seller, or 
        biomaterials supplier, on the basis of any legal theory, for 
        harm allegedly caused by an implant.
            (2) Exclusion.--A civil action brought by a purchaser of a 
        medical device for use in providing professional services 
        against a manufacturer, seller, or biomaterials supplier for 
        loss or damage to an implant or for commercial loss to the 
        purchaser--
                    (A) shall not be considered an action that is 
                subject to this subtitle; and
                    (B) shall be governed by applicable commercial or 
                contract law.
    (c) Scope of Preemption.--
            (1) In general.--This subtitle supersedes any State law 
        regarding recovery for harm caused by an implant and any rule 
        of procedure applicable to a civil action to recover damages 
        for such harm only to the extent that this subtitle establishes 
        a rule of law applicable to the recovery of such damages.
            (2) Applicability of other laws.--Any issue that arises 
        under this subtitle and that is not governed by a rule of law 
        applicable to the recovery of damages described in paragraph 
        (1) shall be governed by applicable Federal or State law.
    (d) Statutory Construction.--Nothing in this subtitle may be 
construed--
            (1) to affect any defense available to a defendant under 
        any other provisions of Federal or State law in an action 
        alleging harm caused by an implant; or
            (2) to create a cause of action or Federal court 
        jurisdiction pursuant to section 1331 or 1337 of title 28, 
        United States Code, that otherwise would not exist under 
        applicable Federal or State law.

SEC. 125. LIABILITY OF BIOMATERIALS SUPPLIERS.

    (a) In General.--
            (1) Exclusion from liability.--Except as provided in 
        paragraph (2), a biomaterials supplier shall not be liable for 
        harm to a claimant caused by an implant.
            (2) Liability.--A biomaterials supplier that--
                    (A) is a manufacturer may be liable for harm to a 
                claimant described in subsection (b);
                    (B) is a seller may be liable for harm to a 
                claimant described in subsection (c); and
                    (C) furnishes raw materials or component parts that 
                fail to meet applicable contractual requirements or 
                specifications may be liable for a harm to a claimant 
                described in subsection (d).
    (b) Liability as Manufacturer.--
            (1) In general.--A biomaterials supplier may, to the extent 
        required and permitted by any other applicable law, be liable 
        for harm to a claimant caused by an implant if the biomaterials 
        supplier is the manufacturer of the implant.
            (2) Grounds for liability.--The biomaterials supplier may 
        be considered the manufacturer of the implant that allegedly 
        caused harm to a claimant only if the biomaterials supplier--
                    (A)(i) has registered with the Secretary pursuant 
                to section 510 of the Federal Food, Drug, and Cosmetic 
                Act (21 U.S.C. 360) and the regulations issued under 
                such section; and
                    (ii) included the implant on a list of devices 
                filed with the Secretary pursuant to section 510(j) of 
                such Act (21 U.S.C. 360(j)) and the regulations issued 
                under such section; or
                    (B) is the subject of a declaration issued by the 
                Secretary pursuant to paragraph (3) that states that 
                the supplier, with respect to the implant that 
                allegedly caused harm to the claimant, was required 
                to--
                            (i) register with the Secretary under 
                        section 510 of such Act (21 U.S.C. 360), and 
                        the regulations issued under such section, but 
                        failed to do so; or
                            (ii) include the implant on a list of 
                        devices filed with the Secretary pursuant to 
                        section 510(j) of such Act (21 U.S.C. 360(j)) 
                        and the regulations issued under such section, 
                        but failed to do so.
            (3) Administrative procedures.--
                    (A) In general.--The Secretary may issue a 
                declaration described in paragraph (2)(B) on the motion 
                of the Secretary or on petition by any person, after 
                providing--
                            (i) notice to the affected persons; and
                            (ii) an opportunity for an informal 
                        hearing.
                    (B) Docketing and final decision.--Immediately upon 
                receipt of a petition filed pursuant to this paragraph, 
                the Secretary shall docket the petition. Not later than 
                180 days after the petition is filed, the Secretary 
                shall issue a final decision on the petition.
                    (C) Applicability of statute of limitations.--Any 
                applicable statute of limitations shall toll during the 
                period during which a claimant has filed a petition 
                with the Secretary under this paragraph.
    (c) Liability as Seller.--A biomaterials supplier may, to the 
extent required and permitted by any other applicable law, be liable as 
a seller for harm to a claimant caused by an implant if the 
biomaterials supplier--
            (1) held title to the implant that allegedly caused harm to 
        the claimant as a result of purchasing the implant after--
                    (A) the manufacture of the implant; and
                    (B) the entrance of the implant in the stream of 
                commerce; and
            (2) subsequently resold the implant.
    (d) Liability for Violating Contractual Requirements or 
Specifications.--A biomaterials supplier may, to the extent required 
and permitted by any other applicable law, be liable for harm to a 
claimant caused by an implant, if the claimant in an action shows, by a 
preponderance of the evidence, that--
            (1) the raw materials or component parts delivered by the 
        biomaterials supplier either--
                    (A) did not constitute the product described in the 
                contract between the biomaterials supplier and the 
                person who contracted for delivery of the product; or
                    (B) failed to meet any specifications that were--
                            (i) provided to the biomaterials supplier 
                        and not expressly repudiated by the 
                        biomaterials supplier prior to acceptance of 
                        delivery of the raw materials or component 
                        parts;
                            (ii)(I) published by the biomaterials 
                        supplier;
                            (II) provided to the manufacturer by the 
                        biomaterials supplier; or
                            (III) contained in a master file that was 
                        submitted by the biomaterials supplier
                         to the Secretary and that is currently 
maintained by the biomaterials supplier for purposes of premarket 
approval of medical devices; or
                            (iii)(I) included in the submissions for 
                        purposes of premarket approval or review by the 
                        Secretary under section 510, 513, 515, or 520 
                        of the Federal Food, Drug, and Cosmetic Act (21 
                        U.S.C. 360, 360c, 360e, or 360j); and
                            (II) have received clearance from the 
                        Secretary,
                if such specifications were provided by the 
                manufacturer to the biomaterials supplier and were not 
                expressly repudiated by the biomaterials supplier prior 
                to the acceptance by the manufacturer of delivery of 
                the raw materials or component parts; and
            (2) such conduct was an actual and proximate cause of the 
        harm to the claimant.

SEC. 126. PROCEDURES FOR DISMISSAL OF CIVIL ACTIONS AGAINST 
              BIOMATERIALS SUPPLIERS.

    (a) Motion To Dismiss.--In any action that is subject to this 
subtitle, a biomaterials supplier who is a defendant in such action 
may, at any time during which a motion to dismiss may be filed under an 
applicable law, move to dismiss the action on the grounds that--
            (1) the defendant is a biomaterials supplier; and
            (2)(A) the defendant should not, for the purposes of--
                    (i) section 125(b), be considered to be a 
                manufacturer of the implant that is subject to such 
                section; or
                    (ii) section 125(c), be considered to be a seller 
                of the implant that allegedly caused harm to the 
                claimant; or
            (B)(i) the claimant has failed to establish, pursuant to 
        section 125(d), that the supplier furnished raw materials or 
        component parts in violation of contractual requirements or 
        specifications; or
            (ii) the claimant has failed to comply with the procedural 
        requirements of subsection (b).
    (b) Procedural Requirements.--
            (1) In general.--The procedural requirements described in 
        paragraphs (2) and (3) shall apply to any action by a claimant 
        against a biomaterials supplier that is subject to this 
        subtitle.
            (2) Manufacturer of implant shall be named a party.--The 
        claimant shall be required to name the manufacturer of the 
        implant as a party to the action, unless--
                    (A) the manufacturer is subject to service of 
                process solely in a jurisdiction in which the 
                biomaterials supplier is not domiciled or subject to a 
                service of process; or
                    (B) an action against the manufacturer is barred by 
                applicable law.
            (3) Affidavit.--At the time the claimant brings an action 
        against a biomaterials supplier the claimant shall be required 
        to submit an affidavit that--
                    (A) declares that the claimant has consulted and 
                reviewed the facts of the action with a qualified 
                specialist, whose qualifications the claimant shall 
                disclose;
                    (B) includes a written determination by a qualified 
                specialist that the raw materials or component parts 
                actually used in the manufacture of the implant of the 
                claimant were raw materials or component parts 
                described in section 125(d)(1), together with a 
                statement of the basis for such a determination;
                    (C) includes a written determination by a qualified 
                specialist that, after a review of the medical record 
                and other relevant material, the raw material or 
                component part supplied by the biomaterials supplier 
                and actually used in the manufacture of the implant was 
                a cause of the harm alleged by claimant, together with 
                a statement of the basis for the determination; and
                    (D) states that, on the basis of review and 
                consultation of the qualified specialist, the claimant 
                (or the attorney of the claimant) has concluded that 
                there is a reasonable and meritorious cause for the 
                filing of the action against the biomaterials supplier.
    (c) Proceeding on Motion To Dismiss.--The following rules shall 
apply to any proceeding on a motion to dismiss filed under this 
section:
            (1) Affidavits relating to listing and declarations.--
                    (A) In general.--The defendant in the action may 
                submit an affidavit demonstrating that defendant has 
                not included the implant on a list, if any, filed with 
                the Secretary pursuant to section 510(j) of the Federal 
                Food, Drug, and Cosmetic Act (21 U.S.C. 360(j)).
                    (B) Response to motion to dismiss.--In response to 
                the motion to dismiss, the claimant may submit an 
                affidavit demonstrating that--
                            (i) the Secretary has, with respect to the 
                        defendant and the implant that allegedly caused 
                        harm to the claimant, issued a declaration 
                        pursuant to section 125(b)(2)(B); or
                            (ii) the defendant who filed the motion to 
                        dismiss is a seller of the implant who is 
                        liable under section 125(c).
            (2) Effect of motion to dismiss on discovery.--
                    (A) In general.--If a defendant files a motion to 
                dismiss under paragraph (1) or (3) of subsection (a), 
                no discovery shall be permitted in connection to the 
                action that is the subject of the motion, other than 
                discovery necessary to determine a motion to dismiss 
                for lack of jurisdiction, until such time as the court 
                rules on the motion to dismiss in accordance with the 
                affidavits submitted by the parties in accordance with 
                this section.
                    (B) Discovery.--If a defendant files a motion to 
                dismiss under subsection (a)(2) on the grounds that the 
                biomaterials supplier did not furnish raw materials or 
                component parts in violation of contractual 
                requirements or specifications, the court may permit 
                discovery, as ordered by the court. The discovery 
                conducted pursuant to this subparagraph shall be 
                limited to issues that are directly relevant to--
                            (i) the pending motion to dismiss; or
                            (ii) the jurisdiction of the court.
            (3) Affidavits relating status of defendant.--
                    (A) In general.--Except as provided in clauses (i) 
                and (ii) of subparagraph (B), the court shall consider 
                a defendant to be a biomaterials supplier who is not 
                subject to an action for harm to a claimant caused by 
                an implant, other than an action relating to liability 
                for a violation of contractual requirements or 
                specifications described in subsection (d).
                    (B) Responses to motion to dismiss.--The court 
                shall grant a motion to dismiss any action that asserts 
                liability of the defendant under subsection (b) or (c) 
                of section 125 on the grounds that the defendant is not 
                a manufacturer subject to such subsection 125(b) or 
                seller subject to subsection 125(c), unless the 
                claimant submits a valid affidavit that demonstrates 
                that--
                            (i) with respect to a motion to dismiss 
                        contending the defendant is not a manufacturer, 
                        the defendant meets the applicable requirements 
                        for liability as a manufacturer under section 
                        125(b); or
                            (ii) with respect to a motion to dismiss 
                        contending that the defendant is not a seller, 
                        the defendant meets the applicable requirements 
                        for liability as a seller under section 125(c).
            (4) Basis of ruling on motion to dismiss.--
                    (A) In general.--The court shall rule on a motion 
                to dismiss filed under subsection (a) solely on the 
                basis of the pleadings of the parties made pursuant to 
                this section and any affidavits submitted by the 
                parties pursuant to this section.
                    (B) Motion for summary judgment.--Notwithstanding 
                any other provision of law, if the court determines 
                that the pleadings and affidavits made by parties 
                pursuant to this section raise genuine issues as 
                concerning material facts with respect to a motion 
                concerning contractual requirements and specifications, 
                the court may deem the motion to dismiss to be a motion 
                for summary judgment made pursuant to subsection (d).
    (d) Summary Judgment.--
            (1) In general.--
                    (A) Basis for entry of judgment.--A biomaterials 
                supplier shall be entitled to entry of judgment without 
                trial if the court finds there is no genuine issue as 
                concerning any material fact for each applicable 
                element set forth in paragraphs (1) and (2) of section 
                125(d).
                    (B) Issues of material fact.--With respect to a 
                finding made under subparagraph (A), the court shall 
                consider a genuine issue of material fact to exist only 
                if the evidence submitted by claimant would be 
                sufficient to allow a reasonable jury to reach a 
                verdict for the claimant if the jury found the evidence 
                to be credible.
            (2) Discovery made prior to a ruling on a motion for 
        summary judgment.--If, under applicable rules, the court 
        permits discovery prior to a ruling on a motion for summary 
        judgment made pursuant to this subsection, such discovery shall 
        be limited solely to establishing whether a genuine issue of 
        material fact exists.
            (3) Discovery with respect to a biomaterials supplier.--A 
        biomaterials supplier shall be subject to discovery in 
        connection with a motion seeking dismissal or summary judgment 
        on the basis of the inapplicability of section 125(d) or the 
        failure to establish the applicable elements of section 125(d) 
        solely to the extent permitted by the applicable Federal or 
        State rules for discovery against nonparties.
    (e) Stay Pending Petition for Declaration.--If a claimant has filed 
a petition for a declaration pursuant to section 125(b) with respect to 
a defendant, and the Secretary has not issued a final decision on the 
petition, the court shall stay all proceedings with respect to that 
defendant until such time as the Secretary has issued a final decision 
on the petition.
    (f) Manufacturer Conduct of Proceeding.--The manufacturer of an 
implant that is the subject of an action covered under this subtitle 
shall be permitted to file and conduct a proceeding on any motion for 
summary judgment or dismissal filed by a biomaterials supplier who is a 
defendant under this section if the manufacturer and any other 
defendant in such action enter into a valid and applicable contractual 
agreement under which the manufacturer agrees to bear the cost of such 
proceeding or to conduct such proceeding.
    (g) Attorney Fees.--The court shall require the claimant to 
compensate the biomaterials supplier (or a manufacturer appearing in 
lieu of a supplier pursuant to subsection (f)) for attorney fees and 
costs, if--
            (1) the claimant named or joined the biomaterials supplier; 
        and
            (2) the court found the claim against the biomaterials 
        supplier to be without merit and frivolous.

                       Subtitle C--Applicability

SEC. 131. APPLICABILITY.

    This title shall apply to all civil actions covered under this 
title that are commenced on or after the date of enactment of this Act, 
including any such action with respect to which the harm asserted in 
the action or the conduct that caused the injury occurred before the 
date of enactment of this Act.

       TITLE II--PROTECTION OF THE HEALTH AND SAFETY OF PATIENTS

SEC. 201. ADDITIONAL RESOURCES FOR STATE HEALTH CARE QUALITY ASSURANCE 
              AND ACCESS ACTIVITIES.

    Each State shall require that not less than 50 percent of all 
awards of punitive damages resulting from all health care liability 
actions in that State, if punitive damages are otherwise permitted by 
applicable law, be used for activities relating to--
            (1) the licensing, investigating, disciplining, and 
        certification of health care professionals in the State; and
            (2) the reduction of malpractice-related costs for health 
        care providers volunteering to provide health care services in 
        medically underserved areas.

SEC. 202. QUALITY ASSURANCE, PATIENT SAFETY, AND CONSUMER INFORMATION.

    (a) Advisory Panel.--
            (1) In general.--Not later than 90 days after the date of 
        enactment of this Act, the Administrator of the Agency for 
        Health Care Policy and Research (hereafter referred to in this 
        section as the ``Administrator'') shall establish an advisory 
        panel to coordinate and evaluate, methods, procedures, and data 
        to enhance the quality, safety, and effectiveness of health 
        care services provided to patients.
            (2) Participation.--In establishing the advisory panel 
        under paragraph (1), the Administrator shall ensure that 
        members of the panel include representatives of public and 
        private sector entities having expertise in quality assurance, 
        risk assessment, risk management, patient safety, and patient 
        satisfaction.
            (3) Objectives.--In carrying out the duties described in 
        this section, the Administrator, acting through the advisory 
        panel established under paragraph (1), shall conduct a survey 
        of public and private entities involved in quality assurance, 
        risk assessment, patient safety, patient satisfaction, and 
        practitioner licensing. Such survey shall include the gathering 
        of data with respect to--
                    (A) performance measures of quality for health care 
                providers and health plans;
                    (B) developments in survey methodology, sampling, 
                and audit methods;
                    (C) methods of medical practice and patterns, and 
                patient outcomes; and
                    (D) methods of disseminating information concerning 
                successful health care quality improvement programs, 
                risk management and patient safety programs, practice 
                guidelines, patient satisfaction, and practitioner 
                licensing.
    (b) Guidelines.--Not later than 2 years after the date of enactment 
of this Act, the Administrator shall, in accordance with chapter 5 of 
title 5, United States Code, establish health care quality assurance, 
patient safety and consumer information guidelines. Such guidelines 
shall be modified periodically when determined appropriate by the 
Administrator. Such guidelines shall be advisory in nature and not 
binding.
    (c) Reports.--
            (1) Initial report.--Not later than 6 months after the date 
        of enactment of this Act, the Administrator shall prepare and 
        submit to the Committee on Labor and Human Resources of the 
        Senate and the Committee on Commerce of the House of 
        Representatives, a report that contains--
                    (A) data concerning the availability of information 
                relating to risk management, quality assessment, 
                patient safety, and patient satisfaction;
                    (B) an estimation of the degree of consensus 
                concerning the accuracy and content of the information 
                available under subparagraph (A);
                    (C) a summary of the best practices used in the 
                public and private sectors for disseminating 
                information to consumers; and
                    (D) an evaluation of the National Practitioner Data 
                Bank (as established under the Health Quality 
                Improvement Act of 1986), for reliability and validity 
                of the data and the effectiveness of the Data Bank in 
                assisting hospitals and medical groups in overseeing 
                the quality of practitioners.
            (2) Interim report.--Not later than 1 year after the date 
        of enactment of this Act, the Administrator shall prepare and 
        submit to the Committees referred to in paragraph (1) a report, 
        based on the results of the advisory panel survey conducted 
        under subsection (a)(3), concerning--
                    (A) the consensus of indicators of patient safety 
                and risk;
                    (B) an assessment of the consumer perspective on 
                health care quality that includes an examination of--
                            (i) the information most often requested by 
                        consumers;
                            (ii) the types of technical quality 
                        information that consumers find compelling;
                            (iii) the amount of information that 
                        consumers consider to be sufficient and the 
                        amount of such information considered 
                        overwhelming; and
                            (iv) the manner in which such information 
                        should be presented;
                and recommendations for increasing the awareness of 
                consumers concerning such information;
                    (C) proposed methods, building on existing data 
                gathering and dissemination systems, for ensuring that 
                such data is available and accessible to consumers, 
                employers, hospitals, and patients;
                    (D) the existence of legal, regulatory, and 
                practical obstacles to making such data available and 
                accessible to consumers;
                    (E) privacy or proprietary issues involving the 
                dissemination of such data;
                    (F) an assessment of the appropriateness of 
                collecting such data at the Federal or State level;
                    (G) an evaluation of the value of permitting 
                consumers to have access to information contained in 
                the National Practitioner Data Bank and recommendations 
                to improve the reliability and validity of the 
                information; and
                    (H) the reliability and validity of data collected 
                by the State medical boards and recommendations for 
                developing investigation protocols.
            (3) Annual report.--Not later than 1 year after the date of 
        the submission of the report under paragraph (2), and each year 
        thereafter, the Administrator shall prepare and submit to the 
        Committees referred to in paragraph (1) a report concerning the 
        progress of the advisory panel in the development of a 
        consensus with respect to the findings of the panel and in the 
        development and modification of the guidelines required under 
        subsection (b).
            (4) Termination.--The advisory panel shall terminate on the 
        date that is 3 years after the date of enactment of this Act.

                        TITLE III--SEVERABILITY

SEC. 301. SEVERABILITY.

    If any provision of this Act, an amendment made by this Act, or the 
application of such provision or amendment to any person or 
circumstance is held to be unconstitutional, the remainder of this Act, 
the amendments made by this Act, and the application of the provisions 
of such to any person or circumstance shall not be affected thereby.
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