[Congressional Bills 111th Congress]
[From the U.S. Government Publishing Office]
[H.R. 4039 Introduced in House (IH)]

111th CONGRESS
  1st Session
                                H. R. 4039

  To improve the medical justice system by encouraging the prompt and 
 fair resolution of disputes, enhancing the quality of care, ensuring 
   patient access to health care services, fostering alternatives to 
 litigation, and combating defensive medicine, and for other purposes.


_______________________________________________________________________


                    IN THE HOUSE OF REPRESENTATIVES

                            November 6, 2009

Mr. Dent (for himself, Mr. Lee of New York, and Mr. Tiberi) introduced 
 the following bill; which was referred to the Committee on Energy and 
  Commerce, and in addition to the Committee on the Judiciary, for a 
 period to be subsequently determined by the Speaker, in each case for 
consideration of such provisions as fall within the jurisdiction of the 
                          committee concerned

_______________________________________________________________________

                                 A BILL


 
  To improve the medical justice system by encouraging the prompt and 
 fair resolution of disputes, enhancing the quality of care, ensuring 
   patient access to health care services, fostering alternatives to 
 litigation, and combating defensive medicine, and for other purposes.

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

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Ending Defensive Medicine and 
Encouraging Innovative Reforms Act of 2009''.

SEC. 2. TABLE OF CONTENTS.

    The table of contents is as follows:

Sec. 1. Short title.
Sec. 2. Table of contents.
                      TITLE I--NATIONWIDE REFORMS

                         Subtitle A--In General

Sec. 101. Authorization of payment of future damages to claimants in 
                            health care lawsuits.
Sec. 102. Fair Share Rule.
Sec. 103. Certificate of Merit.
Sec. 104. Practice guidelines.
Sec. 105. Payment determination.
Sec. 106. Definitions.
                    Subtitle B--Safety Net Providers

Sec. 121. Protection for emergency and related services furnished 
                            pursuant to EMTALA.
             Subtitle C--Community Health Center Volunteers

Sec. 131. Protection for health center volunteer practitioners.
                 Subtitle D--Disaster Relief Volunteers

Sec. 141. Protection for disaster relief volunteers.
                   TITLE II--STATE REFORM INCENTIVES

Sec. 201. Public Health Service Act amendment.

                      TITLE I--NATIONWIDE REFORMS

                         Subtitle A--In General

SEC. 101. AUTHORIZATION OF PAYMENT OF FUTURE DAMAGES TO CLAIMANTS IN 
              HEALTH CARE LAWSUITS.

    (a) Compensating Patient Injury.--In any health care lawsuit, if an 
award of future damages, without reduction to present value, equaling 
or exceeding $50,000 is made against a party with sufficient insurance 
or other assets to fund a periodic payment of such a judgment, the 
court shall, at the request of any party, enter a judgment ordering 
that the future damages be paid by periodic payments. In any health 
care lawsuit, the court may be guided by the Uniform Periodic Payment 
of Judgments Act promulgated by the National Conference of 
Commissioners on Uniform State Laws.
    (b) Applicability.--This section applies to all actions which have 
not been first set for trial or retrial before the date of enactment of 
this Act.

SEC. 102. FAIR SHARE RULE.

    In any health care lawsuit, each party shall be liable for that 
party's several share of any damages only and not for the share of any 
other person. Each party shall be liable only for the amount of damages 
allocated to such party in direct proportion to such party's percentage 
of responsibility. Whenever a judgment of liability is rendered as to 
any party, a separate judgment shall be rendered against each such 
party for the amount allocated to such party. For purposes of this 
section, the trier of fact shall determine the proportion of 
responsibility of each party for the claimant's harm.

SEC. 103. CERTIFICATE OF MERIT.

    (a) Preliminary Procedure.--Within 30 days of the filing of a 
health care lawsuit, the court shall appoint a qualified specialist 
whose appointment is agreed to by one qualified specialist chosen by 
the claimant and one qualified specialist chosen by the defendant. If a 
qualified specialist is not agreed to by the qualified specialist 
chosen by the claimant and the qualified specialist chosen by the 
defendant within such 30 days, then the court shall appoint such 
qualified specialist at its discretion. The qualified specialist 
appointed by the court shall, within 45 days of such appointment, 
submit to the court an affidavit that includes such specialist's 
statement of opinion whether, based on 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. 
If such specialist does not submit such affidavit to the court within 
45 days of such appointment, the court shall dismiss such health care 
lawsuit. Such affidavit shall also contain a statement by the qualified 
specialist of specific breaches in the standard of care and the 
approximate negligence causation. Such affidavit shall not be 
admissible in any health care lawsuit or other court proceedings, or 
any arbitration proceeding. However, such affidavit, and information 
relevant to the determinations made by such specialist in such 
affidavit, shall be discoverable by the plaintiff and the defendant. In 
the case of multiple defendants, a separate affidavit shall be required 
for each defendant. The court shall set a reasonable fee that shall be 
paid by the claimant for the preparation of such affidavit by such 
qualified specialist. The plaintiff's attorney shall be given 90 days 
to obtain the certificate of merit affidavit in cases where the period 
to file the claim is due to expire because of the statute of 
limitations. If a case is filed without a certificate of merit 
affidavit, dismissal of the case is automatic without an extension 
permitted under the applicable statute of limitation exemption 
provision.
    (b) Loser Pays.--In a health care lawsuit, in the event the 
statement of opinion by a qualified specialist appointed by the court 
in an affidavit is that there is no reasonable and meritorious cause 
for the filing of the action against the defendant, and the claimant 
does not substantially prevail by judgment, settlement, mediation, 
arbitration, or any other form of alternative dispute resolution, the 
court shall order the claimant, or such claimant's attorneys, to pay 
the costs and reasonable attorneys fees incurred by the defendant as a 
direct result of the health care lawsuit in which such qualified 
specialist's opinion was filed. Claimants and their attorneys shall 
share liability for such costs and reasonable attorneys fees incurred, 
as determined by the court in the interests of justice.
    (c) Definition.--In this section, the term ``qualified specialist'' 
means, with respect to a health care lawsuit--
            (1) a health care professional who--
                    (A) is appropriately credentialed or licensed in 
                one or more States to deliver health care services;
                    (B) typically treats the diagnosis or condition or 
                provides the type of treatment under review;
                    (C) can demonstrate by competent evidence that, as 
                a result of training, education, knowledge, and 
                experience in the evaluation, diagnosis, and treatment 
                of the disease or injury which is the subject matter of 
                the lawsuit against the defendant, the health care 
                professional is substantially familiar with applicable 
                standards of care and practice on the date of the 
                incident as they relate to the act or omission which is 
                the subject of the lawsuit; and
                    (D) has not been out of practice for more than 5 
                consecutive years; and
            (2) if the claim in the health care lawsuit involved 
        treatment that is recommended or provided by a physician 
        (allopathic or osteopathic), with respect to issues of 
        negligence concerning such treatment, a physician whose medical 
        specialty or subspecialty is the same as the defendant's or in 
        addition to a showing of substantial familiarity in accordance 
        with this section, there is a showing that the standards of 
        care and practice in the two specialty or subspecialty fields 
        are similar.

SEC. 104. PRACTICE GUIDELINES.

    Notwithstanding any other provision of Federal, State, or local law 
the following shall apply:
            (1) In a health care lawsuit or proceeding brought against 
        a health care provider, such provider shall not be liable for 
        the care provided if, in delivering such care, such provider 
        acted consistent with accepted clinical practice guidelines 
        established by the specialty of which the defendant is board 
        certified or if guidelines established by the specialty are not 
        available, accepted clinical practice guideline listed in the 
        National Guideline Clearinghouse. Non-compliance with accepted 
        clinical practice guidelines established by the specialty of 
        which the defendant is board certified, or if guidelines 
        established by the specialty are not available, accepted 
        clinical practice guidelines listed in the National Guideline 
        Clearinghouse shall not, in a health care lawsuit or proceeding 
        brought against a health care provider, constitute a breach of 
        the applicable medical standard of care, or be otherwise 
        admissible to prove a breach of the standard of care, 
        negligence or other tortious conduct.
            (2) Compliance or non-compliance with regulations, 
        directives, or guidelines established by or on behalf of the 
        Secretary of Health and Human Services pursuant to authority 
        set forth in title XVIII of the Social Security Act (42 U.S.C. 
        1395-1395ccc) shall not, in a health care lawsuit or proceeding 
        brought against a health care provider, constitute a breach of 
        the medical standard of care, or be otherwise admissible to 
        prove a breach of the medical standard of care, negligence or 
        other tortious conduct.
            (3) Compliance or non-compliance with regulations, 
        directives, or guidelines established by or on behalf of the 
        Secretary of Health and Human Services or any State official or 
        entity administering Medicaid programs under title XIX of the 
        Social Security Act (42 U.S.C. 1396-1396v) and Children's 
        Health Insurance Programs under title XXI of the Social 
        Security Act (42 U.S.C. 1397aa-1397jj) shall not, in a health 
        care lawsuit or proceeding brought against a health care 
        provider, constitute a breach of the applicable medical 
        standard of care, or be otherwise admissible to prove a breach 
        of the standard of care, negligence or other tortious conduct.
            (4) Compliance or non-compliance with Comparative 
        Effectiveness Research and any regulations, directives, or 
        guidelines based in whole or in part upon such research shall 
        not, in a health care lawsuit or proceeding brought against a 
        health care provider, constitute a breach of the applicable 
        medical standard of care, or be otherwise admissible to prove 
        the medical standard of care, negligence or other tortious 
        conduct.

SEC. 105. PAYMENT DETERMINATION.

    Notwithstanding any other provision of Federal, State, or local law 
the following shall apply:
            (1) Evidence of payments and reimbursements made to health 
        care providers pursuant to title XVIII of the Social Security 
        Act (42 U.S.C. 1395-1395ccc) and evidence of payment rates, 
        payment mechanisms, and payment policies established on or 
        behalf of the Secretary of Health and Human Services for 
        services provided pursuant to the programs set forth in title 
        XVIII of the Social Security Act (42 U.S.C. 1395-1395ccc) shall 
        not, in a health care lawsuit or proceeding brought against a 
        health care provider, constitute a determination that a health 
        care provider has or has not met the medical standard of care 
        or be otherwise admissible to prove breach of the medical 
        standard of care, negligence or other tortious conduct.
            (2) Compliance or non-compliance with payment rates, 
        payment mechanisms, or payment policies established by or on 
        behalf of the Secretary of Health and Human Services or any 
        State official or entity administering Medicaid programs under 
        title XIX of the Social Security Act (42 U.S.C. 1396-1396v) and 
        Children's Health Insurance Programs under title XXI of the 
        Social Security Act (42 U.S.C. 1397aa-1397jj) shall not, in a 
        health care lawsuit or proceeding brought against a health care 
        provider, constitute a determination that a health care 
        provider has or has not met the applicable medical standard of 
        care or be otherwise admissible to prove a breach of the 
        medical standard of care, negligence or other tortious conduct.

SEC. 106. DEFINITIONS.

    In this subtitle:
            (1) Health care lawsuit.--The term ``health care lawsuit'' 
        means any health care liability claim concerning the provision 
        of health care goods or services or any medical product 
        affecting interstate commerce, or any health care liability 
        action concerning the provision of health care goods or 
        services or any medical product affecting interstate commerce, 
        brought in a State or Federal court or pursuant to an 
        alternative dispute resolution system, against a health care 
        provider, a health care organization, or the manufacturer, 
        distributor, supplier, marketer, promoter, or seller of a 
        medical product, regardless of the theory of liability on which 
        the claim is based, or the number of claimants, plaintiffs, 
        defendants, or other parties, or the number of claims or causes 
        of action, in which the claimant alleges a health care 
        liability claim. Such term does not include a claim or action 
        which is based on criminal liability; which seeks civil fines 
        or penalties paid to Federal, State, or local government; or 
        which is grounded in antitrust.
            (2) Claimant.--The term ``claimant'' means any person who 
        brings a health care lawsuit, including a person who asserts or 
        claims a right to legal or equitable contribution, indemnity, 
        or subrogation, arising out of a health care liability claim or 
        action, and any person on whose behalf such a claim is asserted 
        or such an action is brought, whether deceased, incompetent, or 
        a minor.
            (3) Health care provider.--The term `health care provider' 
        means any person or entity--
                    (A) required by State or Federal law or regulations 
                to be licensed, registered, or certified to provide 
                health care services; and
                    (B) being either so licensed, registered, or 
                certified, or exempted from such requirement by other 
                law or regulation.

                    Subtitle B--Safety Net Providers

SEC. 121. PROTECTION FOR EMERGENCY AND RELATED SERVICES FURNISHED 
              PURSUANT TO EMTALA.

    Section 224(g) of the Public Health Service Act (42 U.S.C. 233(g)) 
is amended--
            (1) in paragraph (4), by striking ``An entity'' and 
        inserting ``Subject to paragraph (6), an entity''; and
            (2) by adding at the end the following:
            ``(6)(A) For purposes of this section--
                    ``(i) an entity described in subparagraph (B) shall 
                be considered to be an entity described in paragraph 
                (4); and
                    ``(ii) the provisions of this section shall apply 
                to an entity described in subparagraph (B) in the same 
                manner as such provisions apply to an entity described 
                in paragraph (4), except that--
                            ``(I) notwithstanding paragraph (1)(B), the 
                        deeming of any entity described in subparagraph 
                        (B), or of an officer, governing board member, 
                        employee, contractor, or on-call provider of 
                        such an entity, to be an employee of the Public 
                        Health Service for purposes of this section 
                        shall apply only with respect to items and 
                        services that are furnished to an individual 
                        pursuant to section 1867 of the Social Security 
                        Act and to post stabilization services (as 
                        defined in subparagraph (D)) furnished to such 
                        an individual;
                            ``(II) nothing in paragraph (1)(D) shall be 
                        construed as preventing a physician or 
                        physician group described in subparagraph 
                        (B)(ii) from making the application referred to 
                        in such paragraph or as conditioning the 
                        deeming of a physician or physician group that 
                        makes such an application upon receipt by the 
                        Secretary of an application from the hospital 
                        or emergency department that employs or 
                        contracts with the physician or group, or 
                        enlists the physician or physician group as an 
                        on-call provider;
                            ``(III) notwithstanding paragraph (3), this 
                        paragraph shall apply only with respect to 
                        causes of action arising from acts or omissions 
                        that occur on or after January 1, 2010;
                            ``(IV) paragraph (5) shall not apply to a 
                        physician or physician group described in 
                        subparagraph (B)(ii);
                            ``(V) the Attorney General, in consultation 
                        with the Secretary, shall make separate 
                        estimates under subsection (k)(1) with respect 
                        to entities described in subparagraph (B) and 
                        entities described in paragraph (4) (other than 
                        those described in subparagraph (B)), and the 
                        Secretary shall establish separate funds under 
                        subsection (k)(2) with respect to such groups 
                        of entities, and any appropriations under this 
                        subsection for entities described in 
                        subparagraph (B) shall be separate from the 
                        amounts authorized by subsection (k)(2);
                            ``(VI) notwithstanding subsection (k)(2), 
                        the amount of the fund established by the 
                        Secretary under such subsection with respect to 
                        entities described in subparagraph (B) may 
                        exceed a total of $10,000,000 for a fiscal 
                        year; and
                            ``(VII) subsection (m) shall not apply to 
                        entities described in subparagraph (B).
            ``(B) An entity described in this subparagraph is--
                    ``(i) a hospital or an emergency department to 
                which section 1867 of the Social Security Act applies; 
                and
                    ``(ii) a physician or physician group that is 
                employed by, is under contract with, or is an on-call 
                provider of such hospital or emergency department, to 
                furnish items and services to individuals under such 
                section.
            ``(C) For purposes of this paragraph, the term `on-call 
        provider' means a physician or physician group that--
                    ``(i) has full, temporary, or locum tenens staff 
                privileges at a hospital or emergency department to 
                which section 1867 of the Social Security Act applies; 
                and
                    ``(ii) is not employed by or under contract with 
                such hospital or emergency department, but agrees to be 
                ready and available to provide services pursuant to 
                section 1867 of the Social Security Act or post 
                stabilization services to individuals being treated in 
                the hospital or emergency department with or without 
                compensation from the hospital or emergency department.
            ``(D) For purposes of this paragraph, the term `post 
        stabilization services' means, with respect to an individual 
        who has been treated by an entity described in subparagraph (B) 
        for purposes of complying with section 1867 of the Social 
        Security Act, services that are--
                    ``(i) related to the condition that was so treated; 
                and
                    ``(ii) provided after the individual is stabilized 
                in order to maintain the stabilized condition or to 
                improve or resolve the condition of the individual.
            ``(E)(i) Nothing in this paragraph (or in any other 
        provision of this section as such provision applies to entities 
        described in subparagraph (B) by operation of subparagraph (A)) 
        shall be construed as authorizing or requiring the Secretary to 
        make payments to such entities, the budget authority for which 
        is not provided in advance by appropriation Acts.
            ``(ii) The Secretary shall limit the total amount of 
        payments under this paragraph for a fiscal year to the total 
        amount appropriated in advance by appropriation Acts for such 
        purpose for such fiscal year. If the total amount of payments 
        that would otherwise be made under this paragraph for a fiscal 
        year exceeds such total amount appropriated, the Secretary 
        shall take such steps as may be necessary to ensure that the 
        total amount of payments under this paragraph for such fiscal 
        year does not exceed such total amount appropriated.''.

             Subtitle C--Community Health Center Volunteers

SEC. 131. PROTECTION FOR HEALTH CENTER VOLUNTEER PRACTITIONERS.

    (a) In General.--Section 224 of the Public Health Service Act (42 
U.S.C. 233) is amended--
            (1) in subsection (g)(1)(A)--
                    (A) in the first sentence, by striking ``or 
                employee'' and inserting ``employee, or (subject to 
                subsection (k)(4)) volunteer practitioner''; and
                    (B) in the second sentence, by inserting ``and 
                subsection (k)(4)'' after ``subject to paragraph (5)''; 
                and
            (2) in each of subsections (g), (i), (j), (k), (l), and 
        (m)--
                    (A) by striking the term ``employee, or 
                contractor'' each place such term appears and inserting 
                ``employee, volunteer practitioner, or contractor'';
                    (B) by striking the term ``employee, and 
                contractor'' each place such term appears and inserting 
                ``employee, volunteer practitioner, and contractor'';
                    (C) by striking the term ``employee, or any 
                contractor'' each place such term appears and inserting 
                ``employee, volunteer practitioner, or contractor''; 
                and
                    (D) by striking the term ``employees, or 
                contractors'' each place such term appears and 
                inserting ``employees, volunteer practitioners, or 
                contractors''.
    (b) Applicability; Definition.--Section 224(k) of the Public Health 
Service Act (42 U.S.C. 233(k)) is amended by adding at the end the 
following paragraph:
    ``(4)(A) Subsections (g) through (m) apply with respect to 
volunteer practitioners beginning with the first fiscal year for which 
an appropriations Act provides that amounts in the fund under paragraph 
(2) are available with respect to such practitioners.
    ``(B) For purposes of subsections (g) through (m), the term 
`volunteer practitioner' means a practitioner who, with respect to an 
entity described in subsection (g)(4), meets the following conditions:
            ``(i) In the State involved, the practitioner is a licensed 
        physician, a licensed clinical psychologist, or other licensed 
        or certified health care practitioner.
            ``(ii) At the request of such entity, the practitioner 
        provides services to patients of the entity, at a site at which 
        the entity operates or at a site designated by the entity. The 
        weekly number of hours of services provided to the patients by 
        the practitioner is not a factor with respect to meeting 
        conditions under this subparagraph.
            ``(iii) The practitioner does not for the provision of such 
        services receive any compensation from such patients, from the 
        entity, or from third-party payers (including reimbursement 
        under any insurance policy or health plan, or under any Federal 
        or State health benefits program).''.

                 Subtitle D--Disaster Relief Volunteers

SEC. 141. PROTECTION FOR DISASTER RELIEF VOLUNTEERS.

    (a) Liability of Disaster Relief Volunteers.--A disaster relief 
volunteer shall not be liable for any injury (including personal 
injury, property damage or loss, and death) caused by an act or 
omission of such volunteer in connection with such volunteer's 
providing or facilitating the provision of disaster relief services 
if--
            (1) the injury was not caused by willful, wanton, or 
        reckless misconduct by the volunteer; and
            (2) the injury was not caused by the volunteer's operating 
        a motor vehicle, vessel, aircraft, or other vehicle for which 
        the state requires the operator or the owner of the vehicle, 
        craft, or vessel to--
                    (A) possess an operator's license; or
                    (B) maintain insurance.
    (b) Liability of Employer or Partner of Disaster Relief 
Volunteer.--An employer or business partner of a disaster relief 
volunteer shall not be liable for any act or omission of such volunteer 
in connection with such volunteer's providing or facilitating the 
provision of disaster relief services.
    (c) Liability of Host or Enabling Person, Entity, or 
Organization.--A person or entity, including a governmental entity, 
that works with, accepts services from, or makes its facilities 
available to a disaster relief volunteer to enable such volunteer to 
provide disaster relief services shall not be liable for any act or 
omission of such volunteer in connection with such volunteer's 
providing such services.
    (d) Liability of Nonprofit Organizations.--A nonprofit organization 
shall not be liable for any injury (including personal injury, property 
damage or loss, and death) caused by an act or omission in connection 
with such nonprofit organization's providing or facilitating the 
provision of disaster relief services if the injury was not caused by 
willful, wanton, or reckless misconduct by the nonprofit organization.
    (e) Liability of Governmental and Intergovernmental Entities for 
Donations of Disaster Relief Goods.--A governmental or 
intergovernmental entity that donates to an agency or instrumentality 
of the United States disaster relief goods shall not be liable for any 
injury (including personal injury, property damage or loss, and death) 
caused by such donated goods if the injury was not caused by willful, 
wanton, or reckless misconduct by such governmental or 
intergovernmental entity.
    (f) Limitation on Punitive and Noneconomic Damages Based on Actions 
of Disaster Relief Volunteers and Governmental Donors.--
            (1) Punitive damages.--Unless the claimant establishes by 
        clear and convincing evidence that its damages were proximately 
        caused by willful, wanton, or reckless misconduct by either--
                    (A) a disaster relief volunteer in any civil action 
                brought for injury caused by the volunteer's providing 
                or facilitating the provision of disaster relief 
                services; or
                    (B) a governmental or intergovernmental entity in 
                any civil action brought for injury caused by disaster 
                relief goods donated by such governmental or 
                intergovernmental entity;
        punitive damages may not be awarded in any civil action against 
        such a volunteer or governmental entity.
            (2) Noneconomic damages.--
                    (A) General rule.--In any civil action brought 
                against--
                            (i) a disaster relief volunteer for injury 
                        caused by such volunteer's providing or 
                        facilitating the provision of disaster relief 
                        services; or
                            (ii) a governmental or intergovernmental 
                        entity for injury caused by disaster relief 
                        goods donated by such governmental entity;
                liability for noneconomic loss, if permitted under 
                subsection (a) or (e) of this section, shall be 
                determined in accordance with this subparagraph.
                    (B) Amount of liability.--(i) The amount of 
                noneconomic loss allocated to the disaster relief 
                volunteer or governmental or intergovernmental entity 
                defendant shall be in direct proportion to the 
                percentage of responsibility of that defendant 
                (determined in accordance with clause (ii)) for the 
                harm to the claimant with respect to which that 
                defendant is liable. The court shall render a separate 
                judgment against each defendant in an amount determined 
                pursuant to this section.
                            (ii) For purposes of determining the amount 
                        of noneconomic loss allocated to a defendant, 
                        the trier of fact shall determine the 
                        percentage of responsibility of each person or 
                        entity responsible for the claimant's harm, 
                        whether or not such person or entity is a party 
                        to the action.
    (g) Construction.--Nothing in this section shall be construed to 
abrogate or limit any protection that a volunteer, as defined in the 
Volunteer Protection Act of 1997 (42 U.S.C. 14501 et seq.), may be 
entitled to under that Act. Neither shall anything in this section be 
construed to confer any private right of action or to abrogate or limit 
any protection with respect to either liability or damages that any 
disaster relief volunteer or governmental or intergovernmental entity 
may be entitled to under any other provision of law.
    (h) Supplemental Declaration.--If a Disaster Declaration is issued, 
the President, the Secretary of Health and Human Services, or the 
Secretary of Homeland Security may issue a Supplemental Declaration 
under this section.
            (1) Temporal effect.--Such Supplemental Declaration may 
        provide that, for purposes of this section, such Disaster 
        Declaration shall have such temporal effect as the President or 
        the Secretary may deem necessary or appropriate to further the 
        public interest, including providing that such Disaster 
        Declaration shall have an effective date earlier than the date 
        of the declaration or determination of such Disaster 
        Declaration.
            (2) Geographic and other conditions.--Such Supplemental 
        Declaration may provide that, for purposes of this section, 
        such Disaster Declaration shall have such geographic or other 
        conditions as the President or the Secretary may deem necessary 
        or appropriate to further the public interest.
    (i) Licensing, Certification, and Authorization.--This section 
shall not apply to a disaster relief volunteer where the disaster 
relief service such volunteer provides is of a type that generally 
requires a license, certificate, or authorization, and the disaster 
relief volunteer lacks such license, certificate, or authorization, 
unless--
            (1) such volunteer is licensed, certified, or authorized to 
        provide such services in any State to the extent required, if 
        any, by the appropriate authorities of that State, even if such 
        State is not the State in which the disaster relief volunteer 
        provides disaster relief services; or
            (2) otherwise specified in a Disaster Declaration or 
        Supplemental Declaration under this section.
    (j) Definitions.--For purposes of this section:
            (1) The term ``Disaster Declaration'' means--
                    (A) a public health emergency declaration by the 
                Secretary of Health and Human Services under section 
                319 of the Public Health Service Act (42 U.S.C. 247d);
                    (B) a declaration of a public health emergency or a 
                risk of such emergency as determined by the Secretary 
                of Homeland Security in accordance with clause (i) or 
                clause (ii) of section 2811(b)(3)(A) of such Act (42 
                U.S.C. 300hh-11(b)(3)(A)) and section 503(5) of the 
                Homeland Security Act of 2002 (6 U.S.C. 313(5)); or
                    (C) an emergency or major disaster declaration by 
                the President under section 401 or 501 of the Robert T. 
                Stafford Disaster Relief and Emergency Assistance Act 
                (42 U.S.C. 5170 or 5191).
            (2) The term ``disaster relief volunteer'' means an 
        individual who provides disaster relief services in connection 
        with a Disaster Declaration without expectation or receipt of 
        compensation in exchange for providing such services.
            (3) The term ``disaster relief services'' means services or 
        assistance provided in preparation for, response to, or 
        recovery from any event that is the subject of a Disaster 
        Declaration, including but not limited to health, medical, fire 
        fighting, rescue, reconstruction, and any other services or 
        assistance specified by a Supplemental Declaration under this 
        section as necessary or desirable to prepare for, respond to, 
        or recover from an event that is the subject of a Disaster 
        Declaration.
            (4) The term ``disaster relief good'' means either--
                    (A) those goods provided in preparation for, 
                response to, or recovery from any event that is the 
                subject of a Disaster Declaration and reasonably 
                necessary to such preparation, response, or recovery; 
                or
                    (B) those goods defined by a Disaster Declaration 
                or Supplemental Declaration under this section.
            (5) The term ``noneconomic loss'' means losses for physical 
        and emotional pain, suffering, inconvenience, physical 
        impairment, mental anguish, disfigurement, loss of enjoyment of 
        life, loss of society and companionship, loss of consortium 
        (other than loss of domestic service), hedonic damages, injury 
        to reputation, and all other nonpecuniary losses of any kind or 
        nature.
            (6) The term ``State'' means each of the several States, 
        the District of Columbia, the Commonwealth of Puerto Rico, the 
        Virgin Islands, Guam, American Samoa, the Northern Mariana 
        Islands, any other territory or possession of the United 
        States, or any political subdivision of any such State, 
        territory, or possession, and (for purposes of subsection (h)) 
        any foreign country.
            (7) The term ``compensation'' means monetary or other 
        compensation of any kind provided in exchange for an 
        individual's services, but does not include--
                    (A) reasonable reimbursement or allowance for 
                expenses actually incurred by such an individual;
                    (B) provision of reasonable supplies, lodging, or 
                transportation to such an individual; or
                    (C) such an individual's ordinary salary or 
                compensation paid by his or her employer while such 
                individual is on leave from his or her ordinary duties 
                with such employer in order to provide disaster relief 
                services.

                   TITLE II--STATE REFORM INCENTIVES

SEC. 201. PUBLIC HEALTH SERVICE ACT AMENDMENT.

    The Public Health Service Act is amended by adding at the end the 
following:

              ``TITLE XXXI--MEDICAL LIABILITY ALTERNATIVES

                    ``Subtitle A--Incentive Payments

``SEC. 3101. INCENTIVE PAYMENTS FOR MEDICAL LIABILITY REFORM.

    ``(a) Eligibility.--A State that has enacted and is implementing an 
alternative medical liability law is eligible to receive an incentive 
payment in an amount determined by the Secretary, subject to the 
availability of appropriations for that purpose.
    ``(b) Contents of Alternative Medical Liability Law.--An 
alternative medical liability law shall contain any one or a 
combination of the following litigation alternatives:
            ``(1) Early offer.--Within a time period to be determined 
        by the State, a health care provider may offer to pay economic 
        damages to an injured party. The injured party must be provided 
        an equal amount of time to accept or reject the offer. 
        Notification would not constitute an admission of liability. 
        Evidence of an offer would be inadmissible in a health care 
        lawsuit. Providers should be incentivized to make good faith 
        offers as early as possible and patients should be incentivized 
        to accept legitimate offers of compensation.
            ``(2) Healthcare court.--Health Courts would provide a 
        forum, either a bench or jury trial, where medical liability 
        actions could be heard by judges specially trained in medical 
        liability matters and who hear only medical liability cases.
            ``(3) I'm sorry provision.--In any medical liability 
        action, any and all statements, affirmations, gestures, or 
        conduct expressing apology, sympathy, commiseration, 
        condolence, compassion, fault, or a general sense of 
        benevolence which are made by a healthcare provider to the 
        plaintiff or a relative of the plaintiff which relate solely to 
        the discomfort, pain, suffering, injury, or death as the result 
        of the unanticipated outcome of the medical care shall be 
        inadmissible as evidence of an admission of liability or as 
        evidence of an admission against interest.
            ``(4) Voluntary alternative dispute resolution.--
        Alternatives to medical liability trials would be pursued 
        through binding and nonbinding dispute processes and 
        techniques, including but not limited to mediation and 
        arbitration. Mediation is a private, facilitated negotiation in 
        which parties discuss their dispute with the help of a neutral 
        third party, whose role is to help the parties communicate with 
        one another to reach an agreement or settlement. Arbitration is 
        different from mediation in that the neutral arbitrator 
        actually has the authority to make a decision about the 
        dispute.
            ``(5) Expert witness qualifications.--Amendments to State 
        statutory qualifications for those who may serve as medical 
        expert witnesses at trial, including the creation of additional 
        standards that medical expert witnesses must meet in order to 
        ensure the testimony juries receive is presented by an 
        individual with particularized expertise in the matter in 
        question.
            ``(6) Other alternatives approved by the secretary.--Any 
        other alternative the Secretary approves by rule as carrying 
        out the purposes of this subtitle.
    ``(c) Use of Incentive Payments.--The State shall, not later than 3 
years after receipt of an incentive payment under this title, use that 
incentive payment to improve health care in that State.

``SEC. 3102. STATE REPORTS.

    ``(a) Duty To Report.--Each State that accepts an incentive payment 
under this title shall thereafter submit annual reports to the 
Secretary describing the progress of that State in the implementation 
of that State's alternative medical liability law.
    ``(b) Required Contents of Reports.--Each such report shall 
contain, for the period covered by the report--
            ``(1) the number of health care lawsuits initiated in the 
        State;
            ``(2) the average amount of time taken to resolve each 
        lawsuit that is resolved in the State; and
            ``(3) the average cost of malpractice insurance in the 
        State.

``SEC. 3103. REPORTS BY SECRETARY TO CONGRESS.

    ``(a) Annual Reports by Secretary.--Beginning not later than one 
year after the date of the enactment of this title, the Secretary shall 
submit to Congress an annual report on the effect of the laws of each 
State that has received an incentive payment under this title in 
restoring reliability to that State's medical justice system. Such 
report shall include any determination made by the Secretary under 
subsection (b).
    ``(b) Determination of Effectiveness of Laws.--
            ``(1) General rule.--Except as provided in paragraph (2), 
        after a State makes 3 reports under section 3102, the Secretary 
        shall determine whether, during the period covered by such 
        reports, those laws have brought about--
                    ``(A) a reduction in the number of health care 
                lawsuits initiated in the State;
                    ``(B) a reduction in the amount of time required to 
                resolve lawsuits in the State; and
                    ``(C) a reduction in the cost of malpractice 
                insurance in the State.
            ``(2) Exception.--If the Secretary finds that litigation 
        about the implementation of a State's alternative medical 
        liability laws has prevented those laws from having their 
        expected effect, the Secretary may defer making the 
        determination under paragraph (a) until the Secretary finds 
        that 3 years have passed since that litigation ceased 
        preventing those laws from having their expected effect.

``SEC. 3104. APPLICATION OF SUBTITLE B TO STATES WITH INEFFECTIVE LAWS.

    ``(a) General Rule.--Except as otherwise provided in this section, 
if the Secretary determines under section 3103(b) that a State's 
alternative medical liability laws have not brought about the results 
described in that section, beginning on the first day of the next 
succeeding year after that determination, that State, and any health 
care lawsuit commenced under the law of that State on or after that 
day, shall be subject to the provisions of subtitle B.
    ``(b) Statute of Limitation for Certain Cases.--Any health care 
lawsuit commenced in a State while that State is subject to subtitle B, 
but arising from an injury that occurred before subtitle B began to 
apply in that State, shall continue to be governed by the statute of 
limitations in effect at the time the injury occurred.

``SEC. 3105. APPLICATION REQUIRED FOR PAYMENT.

    ``(a) Application Required.--Each State seeking an incentive 
payment under this title shall submit to the Secretary an application, 
at such time, in such manner, and containing such information as the 
Secretary may require.
    ``(b) Time Limit for Submission of Applications.--The Secretary may 
not accept any application under this subtitle later than 5 years after 
the date of the enactment of this Act.

``SEC. 3106. TECHNICAL ASSISTANCE.

    ``The Secretary may provide technical assistance to the States 
applying for or awarded an incentive payment under this title.

``SEC. 3107. RULEMAKING.

    ``The Secretary may make rules to carry out this title.

``SEC. 3108. AUTHORIZATION OF APPROPRIATIONS.

    ``There are authorized to be appropriated to carry out this title 
such sums as may be necessary, to remain available until expended.

``SEC. 3109. DEFINITIONS.

    ``In this title--
            ``(1) the term `Secretary' means the Secretary of Health 
        and Human Services; and
            ``(2) the term `State' includes the District of Columbia, 
        Puerto Rico, and each other territory or possession of the 
        United States.

    ``Subtitle B--Liability Limits for States With Ineffective Laws

``SEC. 3111. APPLICATION.

    ``This subtitle applies only in those States to which it is made 
applicable by subtitle A.

``SEC. 3112. ENCOURAGING SPEEDY RESOLUTION OF CLAIMS.

    ``The time for the commencement of a health care lawsuit shall be 3 
years after the date of manifestation of injury or 1 year after the 
claimant discovers, or through the use of reasonable diligence should 
have discovered, the injury, whichever occurs first. In no event shall 
the time for commencement of a health care lawsuit exceed 3 years after 
the date of manifestation of injury unless tolled for any of the 
following--
            ``(1) upon proof of fraud;
            ``(2) intentional concealment; or
            ``(3) the presence of a foreign body, which has no 
        therapeutic or diagnostic purpose or effect, in the person of 
        the injured person.
Actions by a minor shall be commenced within 3 years from the date of 
the alleged manifestation of injury except that actions by a minor 
under the full age of 6 years shall be commenced within 3 years of 
manifestation of injury or prior to the minor's 8th birthday, whichever 
provides a longer period. Such time limitation shall be tolled for 
minors for any period during which a parent or guardian and a health 
care provider or health care organization have committed fraud or 
collusion in the failure to bring an action on behalf of the injured 
minor.

``SEC. 3113. COMPENSATING PATIENT INJURY.

    ``(a) Unlimited Amount of Damages for Actual Economic Losses in 
Health Care Lawsuits.--In any health care lawsuit, nothing in this 
subtitle shall limit a claimant's recovery of the full amount of the 
available economic damages, notwithstanding the limitation in 
subsection (b).
    ``(b) Additional Noneconomic Damages.--In any health care lawsuit, 
the amount of noneconomic damages, if available, may be as much as 
$250,000, regardless of the number of parties against whom the action 
is brought or the number of separate claims or actions brought with 
respect to the same injury.
    ``(c) No Discount of Award for Noneconomic Damages.--For purposes 
of applying the limitation in subsection (b), future noneconomic 
damages shall not be discounted to present value. The jury shall not be 
informed about the maximum award for noneconomic damages. An award for 
noneconomic damages in excess of $250,000 shall be reduced either 
before the entry of judgment, or by amendment of the judgment after 
entry of judgment, and such reduction shall be made before accounting 
for any other reduction in damages required by law. If separate awards 
are rendered for past and future noneconomic damages and the combined 
awards exceed $250,000, the future noneconomic damages shall be reduced 
first.
    ``(d) Fair Share Rule.--In any health care lawsuit, each party 
shall be liable for that party's several share of any damages only and 
not for the share of any other person. Each party shall be liable only 
for the amount of damages allocated to such party in direct proportion 
to such party's percentage of responsibility. Whenever a judgment of 
liability is rendered as to any party, a separate judgment shall be 
rendered against each such party for the amount allocated to such 
party. For purposes of this section, the trier of fact shall determine 
the proportion of responsibility of each party for the claimant's harm.

``SEC. 3114. MAXIMIZING PATIENT RECOVERY.

    ``(a) Court Supervision of Share of Damages Actually Paid to 
Claimants.--In any health care lawsuit, the court shall supervise the 
arrangements for payment of damages to protect against conflicts of 
interest that may have the effect of reducing the amount of damages 
awarded that are actually paid to claimants. In particular, in any 
health care lawsuit in which the attorney for a party claims a 
financial stake in the outcome by virtue of a contingent fee, the court 
shall have the power to restrict the payment of a claimant's damage 
recovery to such attorney, and to redirect such damages to the claimant 
based upon the interests of justice and principles of equity. In no 
event shall the total of all contingent fees for representing all 
claimants in a health care lawsuit exceed the following limits:
            ``(1) 40 percent of the first $50,000 recovered by the 
        claimant(s).
            ``(2) 33\1/3\ percent of the next $50,000 recovered by the 
        claimant(s).
            ``(3) 25 percent of the next $500,000 recovered by the 
        claimant(s).
            ``(4) 15 percent of any amount by which the recovery by the 
        claimant(s) is in excess of $600,000.
    ``(b) Applicability.--The limitations in this section shall apply 
whether the recovery is by judgment, settlement, mediation, 
arbitration, or any other form of alternative dispute resolution. In a 
health care lawsuit involving a minor or incompetent person, a court 
retains the authority to authorize or approve a fee that is less than 
the maximum permitted under this section. The requirement for court 
supervision in the first two sentences of subsection (a) applies only 
in civil actions.

``SEC. 3115. ADDITIONAL HEALTH BENEFITS.

    ``In any health care lawsuit involving injury or wrongful death, 
any party may introduce evidence of collateral source benefits. If a 
party elects to introduce such evidence, any opposing party may 
introduce evidence of any amount paid or contributed or reasonably 
likely to be paid or contributed in the future by or on behalf of the 
opposing party to secure the right to such collateral source benefits. 
No provider of collateral source benefits shall recover any amount 
against the claimant or receive any lien or credit against the 
claimant's recovery or be equitably or legally subrogated to the right 
of the claimant in a health care lawsuit involving injury or wrongful 
death. This section shall apply to any health care lawsuit that is 
settled as well as a health care lawsuit that is resolved by a fact 
finder. This section shall not apply to section 1862(b) (42 U.S.C. 
1395y(b)) or section 1902(a)(25) (42 U.S.C. 1396a(a)(25)) of the Social 
Security Act.

``SEC. 3116. PUNITIVE DAMAGES.

    ``(a) In General.--Punitive damages may, if otherwise permitted by 
applicable State or Federal law, be awarded against any person in a 
health care lawsuit only if it is proven by clear and convincing 
evidence that such person acted with malicious intent to injure the 
claimant, or that such person deliberately failed to avoid unnecessary 
injury that such person knew the claimant was substantially certain to 
suffer. In any health care lawsuit where no judgment for compensatory 
damages is rendered against such person, no punitive damages may be 
awarded with respect to the claim in such lawsuit. No demand for 
punitive damages shall be included in a health care lawsuit as 
initially filed. A court may allow a claimant to file an amended 
pleading for punitive damages only upon a motion by the claimant and 
after a finding by the court, upon review of supporting and opposing 
affidavits or after a hearing, after weighing the evidence, that the 
claimant has established by a substantial probability that the claimant 
will prevail on the claim for punitive damages. At the request of any 
party in a health care lawsuit, the trier of fact shall consider in a 
separate proceeding--
            ``(1) whether punitive damages are to be awarded and the 
        amount of such award; and
            ``(2) the amount of punitive damages following a 
        determination of punitive liability.
If a separate proceeding is requested, evidence relevant only to the 
claim for punitive damages, as determined by applicable State law, 
shall be inadmissible in any proceeding to determine whether 
compensatory damages are to be awarded.
    ``(b) Determining Amount of Punitive Damages.--
            ``(1) Factors considered.--In determining the amount of 
        punitive damages, if awarded, in a health care lawsuit, the 
        trier of fact shall consider only the following--
                    ``(A) the severity of the harm caused by the 
                conduct of such party;
                    ``(B) the duration of the conduct or any 
                concealment of it by such party;
                    ``(C) the profitability of the conduct to such 
                party;
                    ``(D) the number of products sold or medical 
                procedures rendered for compensation, as the case may 
                be, by such party, of the kind causing the harm 
                complained of by the claimant;
                    ``(E) any criminal penalties imposed on such party, 
                as a result of the conduct complained of by the 
                claimant; and
                    ``(F) the amount of any civil fines assessed 
                against such party as a result of the conduct 
                complained of by the claimant.
            ``(2) Maximum award.--The amount of punitive damages, if 
        awarded, in a health care lawsuit may be as much as $250,000 or 
        as much as two times the amount of economic damages awarded, 
        whichever is greater. The jury shall not be informed of this 
        limitation.
    ``(c) No Punitive Damages for Products That Comply With FDA 
Standards.--
            ``(1) In general.--
                    ``(A) No punitive damages may be awarded against 
                the manufacturer or distributor of a medical product, 
                or a supplier of any component or raw material of such 
                medical product, based on a claim that such product 
                caused the claimant's harm where--
                            ``(i)(I) such medical product was subject 
                        to premarket approval, clearance, or licensure 
                        by the Food and Drug Administration with 
                        respect to the safety of the formulation or 
                        performance of the aspect of such medical 
                        product which caused the claimant's harm or the 
                        adequacy of the packaging or labeling of such 
                        medical product; and
                            ``(II) such medical product was so 
                        approved, cleared, or licensed; or
                            ``(ii) such medical product is generally 
                        recognized among qualified experts as safe and 
                        effective pursuant to conditions established by 
                        the Food and Drug Administration and applicable 
                        Food and Drug Administration regulations, 
                        including without limitation those related to 
                        packaging and labeling, unless the Food and 
                        Drug Administration has determined that such 
                        medical product was not manufactured or 
                        distributed in substantial compliance with 
                        applicable Food and Drug Administration 
                        statutes and regulations.
                    ``(B) Rule of construction.--Subparagraph (A) may 
                not be construed as establishing the obligation of the 
                Food and Drug Administration to demonstrate 
                affirmatively that a manufacturer, distributor, or 
                supplier referred to in such subparagraph meets any of 
                the conditions described in such subparagraph.
            ``(2) Liability of health care providers.--A health care 
        provider who prescribes, or who dispenses pursuant to a 
        prescription, a medical product approved, licensed, or cleared 
        by the Food and Drug Administration shall not be named as a 
        party to a product liability lawsuit involving such product and 
        shall not be liable to a claimant in a class action lawsuit 
        against the manufacturer, distributor, or seller of such 
        product. Nothing in this paragraph prevents a court from 
        consolidating cases involving health care providers and cases 
        involving products liability claims against the manufacturer, 
        distributor, or product seller of such medical product.
            ``(3) Packaging.--In a health care lawsuit for harm which 
        is alleged to relate to the adequacy of the packaging or 
        labeling of a drug which is required to have tamper-resistant 
        packaging under regulations of the Secretary of Health and 
        Human Services (including labeling regulations related to such 
        packaging), the manufacturer or product seller of the drug 
        shall not be held liable for punitive damages unless such 
        packaging or labeling is found by the trier of fact by clear 
        and convincing evidence to be substantially out of compliance 
        with such regulations.
            ``(4) Exception.--Paragraph (1) shall not apply in any 
        health care lawsuit in which--
                    ``(A) a person, before or after premarket approval, 
                clearance, or licensure of such medical product, 
                knowingly misrepresented to or withheld from the Food 
                and Drug Administration information that is required to 
                be submitted under the Federal Food, Drug, and Cosmetic 
                Act (21 U.S.C. 301 et seq.) or section 351 of the 
                Public Health Service Act (42 U.S.C. 262) that is 
                material and is causally related to the harm which the 
                claimant allegedly suffered; or
                    ``(B) a person made an illegal payment to an 
                official of the Food and Drug Administration for the 
                purpose of either securing or maintaining approval, 
                clearance, or licensure of such medical product.

``SEC. 3117. DEFINITIONS.

    ``In this subtitle:
            ``(1) Alternative dispute resolution system; adr.--The term 
        `alternative dispute resolution system' or `ADR' means a system 
        that provides for the resolution of health care lawsuits in a 
        manner other than through a civil action brought in a State or 
        Federal court.
            ``(2) Claimant.--The term `claimant' means any person who 
        brings a health care lawsuit, including a person who asserts or 
        claims a right to legal or equitable contribution, indemnity, 
        or subrogation, arising out of a health care liability claim or 
        action, and any person on whose behalf such a claim is asserted 
        or such an action is brought, whether deceased, incompetent, or 
        a minor.
            ``(3) Collateral source benefits.--The term `collateral 
        source benefits' means any amount paid or reasonably likely to 
        be paid in the future to or on behalf of the claimant, or any 
        service, product, or other benefit provided or reasonably 
        likely to be provided in the future to or on behalf of the 
        claimant, as a result of the injury or wrongful death, pursuant 
        to--
                    ``(A) any State or Federal health, sickness, 
                income-disability, accident, or workers' compensation 
                law;
                    ``(B) any health, sickness, income-disability, or 
                accident insurance that provides health benefits or 
                income-disability coverage;
                    ``(C) any contract or agreement of any group, 
                organization, partnership, or corporation to provide, 
                pay for, or reimburse the cost of medical, hospital, 
                dental, or income-disability benefits; and
                    ``(D) any other publicly or privately funded 
                program.
            ``(4) Compensatory damages.--The term `compensatory 
        damages' means objectively verifiable monetary losses incurred 
        as a result of the provision of, use of, or payment for (or 
        failure to provide, use, or pay for) health care services or 
        medical products, such as past and future medical expenses, 
        loss of past and future earnings, cost of obtaining domestic 
        services, loss of employment, and loss of business or 
        employment opportunities, damages for physical and emotional 
        pain, suffering, inconvenience, physical impairment, mental 
        anguish, disfigurement, loss of enjoyment of life, loss of 
        society and companionship, loss of consortium (other than loss 
        of domestic service), hedonic damages, injury to reputation, 
        and all other nonpecuniary losses of any kind or nature. The 
        term `compensatory damages' includes economic damages and 
        noneconomic damages, as such terms are defined in this section.
            ``(5) Contingent fee.--The term `contingent fee' includes 
        all compensation to any person or persons which is payable only 
        if a recovery is effected on behalf of one or more claimants.
            ``(6) Economic damages.--The term `economic damages' means 
        objectively verifiable monetary losses incurred as a result of 
        the provision of, use of, or payment for (or failure to 
        provide, use, or pay for) health care services or medical 
        products, such as past and future medical expenses, loss of 
        past and future earnings, cost of obtaining domestic services, 
        loss of employment, and loss of business or employment 
        opportunities.
            ``(7) Health care lawsuit.--The term `health care lawsuit' 
        means any health care liability claim concerning the provision 
        of health care goods or services or any medical product 
        affecting interstate commerce, or any health care liability 
        action concerning the provision of health care goods or 
        services or any medical product affecting interstate commerce, 
        brought in a State or Federal court or pursuant to an 
        alternative dispute resolution system, against a health care 
        provider, a health care organization, or the manufacturer, 
        distributor, supplier, marketer, promoter, or seller of a 
        medical product, regardless of the theory of liability on which 
        the claim is based, or the number of claimants, plaintiffs, 
        defendants, or other parties, or the number of claims or causes 
        of action, in which the claimant alleges a health care 
        liability claim. Such term does not include a claim or action 
        which is based on criminal liability; which seeks civil fines 
        or penalties paid to Federal, State, or local government; or 
        which is grounded in antitrust.
            ``(8) Health care liability action.--The term `health care 
        liability action' means a civil action brought in a State or 
        Federal court or pursuant to an alternative dispute resolution 
        system, against a health care provider, a health care 
        organization, or the manufacturer, distributor, supplier, 
        marketer, promoter, or seller of a medical product, regardless 
        of the theory of liability on which the claim is based, or the 
        number of plaintiffs, defendants, or other parties, or the 
        number of causes of action, in which the claimant alleges a 
        health care liability claim.
            ``(9) Health care liability claim.--The term `health care 
        liability claim' means a demand by any person, whether or not 
        pursuant to ADR, against a health care provider, health care 
        organization, or the manufacturer, distributor, supplier, 
        marketer, promoter, or seller of a medical product, including, 
        but not limited to, third-party claims, cross-claims, counter-
        claims, or contribution claims, which are based upon the 
        provision of, use of, or payment for (or the failure to 
        provide, use, or pay for) health care services or medical 
        products, regardless of the theory of liability on which the 
        claim is based, or the number of plaintiffs, defendants, or 
        other parties, or the number of causes of action.
            ``(10) Health care organization.--The term `health care 
        organization' means any person or entity which is obligated to 
        provide or pay for health benefits under any health plan, 
        including any person or entity acting under a contract or 
        arrangement with a health care organization to provide or 
        administer any health benefit.
            ``(11) Health care provider.--The term `health care 
        provider' means any person or entity required by State or 
        Federal laws or regulations to be licensed, registered, or 
        certified to provide health care services, and being either so 
        licensed, registered, or certified, or exempted from such 
        requirement by other statute or regulation.
            ``(12) Health care goods or services.--The term `health 
        care goods or services' means any goods or services provided by 
        a health care organization, provider, or by any individual 
        working under the supervision of a health care provider, that 
        relates to the diagnosis, prevention, or treatment of any human 
        disease or impairment, or the assessment or care of the health 
        of human beings.
            ``(13) Malicious intent to injure.--The term `malicious 
        intent to injure' means intentionally causing or attempting to 
        cause physical injury other than providing health care goods or 
        services.
            ``(14) Medical product.--The term `medical product' means a 
        drug, device, or biological product intended for humans, and 
        the terms `drug', `device', and `biological product' have the 
        meanings given such terms in sections 201(g)(1) and 201(h) of 
        the Federal Food, Drug and Cosmetic Act (21 U.S.C. 321(g)(1) 
        and (h)) and section 351(a) of the Public Health Service Act 
        (42 U.S.C. 262(a)), respectively, including any component or 
        raw material used therein, but excluding health care services.
            ``(15) Noneconomic damages.--The term `noneconomic damages' 
        means damages for physical and emotional pain, suffering, 
        inconvenience, physical impairment, mental anguish, 
        disfigurement, loss of enjoyment of life, loss of society and 
        companionship, loss of consortium (other than loss of domestic 
        service), hedonic damages, injury to reputation, and all other 
        nonpecuniary losses of any kind or nature.
            ``(16) Punitive damages.--The term `punitive damages' means 
        damages awarded, for the purpose of punishment or deterrence, 
        and not solely for compensatory purposes, against a health care 
        provider, health care organization, or a manufacturer, 
        distributor, or supplier of a medical product. Punitive damages 
        are neither economic nor noneconomic damages.
            ``(17) Recovery.--The term `recovery' means the net sum 
        recovered after deducting any disbursements or costs incurred 
        in connection with prosecution or settlement of the claim, 
        including all costs paid or advanced by any person. Costs of 
        health care incurred by the plaintiff and the attorneys' office 
        overhead costs or charges for legal services are not deductible 
        disbursements or costs for such purpose.
            ``(18) State.--The term `State' has the same meaning as 
        that term has for the purposes of subtitle A.

``SEC. 3118. EFFECT ON OTHER LAWS.

    ``(a) Vaccine Injury.--
            ``(1) To the extent that title XXI establishes a Federal 
        rule of law applicable to a civil action brought for a vaccine-
        related injury or death--
                    ``(A) this subtitle does not affect the application 
                of the rule of law to such an action; and
                    ``(B) any rule of law prescribed by this subtitle 
                in conflict with a rule of law of title XXI shall not 
                apply to such action.
            ``(2) If there is an aspect of a civil action brought for a 
        vaccine-related injury or death to which a Federal rule of law 
        under title XXI of this Act does not apply, then this subtitle 
        or otherwise applicable law (as determined under this subtitle) 
        will apply to such aspect of such action.
    ``(b) Other Federal Law.--Except as provided in this section, 
nothing in this subtitle shall be deemed to affect any defense 
available to a defendant in a health care lawsuit or action under any 
other provision of Federal law.

``SEC. 3119. STATE FLEXIBILITY AND PROTECTION OF STATES' RIGHTS.

    ``(a) Health Care Lawsuits.--The provisions governing health care 
lawsuits set forth in this subtitle preempt, subject to subsections (b) 
and (c), State law to the extent that State law prevents the 
application of any provisions of law established by or under this 
subtitle. The provisions governing health care lawsuits set forth in 
this subtitle supersede chapter 171 of title 28, United States Code, to 
the extent that such chapter--
            ``(1) provides for a greater amount of damages or 
        contingent fees, a longer period in which a health care lawsuit 
        may be commenced, or a reduced applicability or scope of 
        periodic payment of future damages, than provided in this 
        subtitle; or
            ``(2) prohibits the introduction of evidence regarding 
        collateral source benefits, or mandates or permits subrogation 
        or a lien on collateral source benefits.
    ``(b) Protection of States' Rights and Other Laws.--(1) Any issue 
that is not governed by any provision of law established by or under 
this subtitle (including State standards of negligence) shall be 
governed by otherwise applicable State or Federal law.
    ``(2) This subtitle shall not preempt or supersede any State or 
Federal law that imposes greater procedural or substantive protections 
for health care providers and health care organizations from liability, 
loss, or damages than those provided by this subtitle or create a cause 
of action.
    ``(c) State Flexibility.--No provision of this subtitle shall be 
construed to preempt--
            ``(1) any State law (whether effective before, on, or after 
        the date of the enactment of this Act) that specifies a 
        particular monetary amount of compensatory or punitive damages 
        (or the total amount of damages) that may be awarded in a 
        health care lawsuit, regardless of whether such monetary amount 
        is greater or lesser than is provided for under this subtitle, 
        notwithstanding section 4(a); or
            ``(2) any defense available to a party in a health care 
        lawsuit under any other provision of State or Federal law.''.
                                 <all>