Goodlatte Statement at Markup of H.R. 4771, the HEALTH Act

Chairman Goodlatte: The bill before us today, known as the HEALTH Act, is modeled on California’s highly successful litigation reforms that have lowered health care costs and made health care much more accessible to the people of that state. Because the evidence of the effects of those reforms on lowering health care costs is so overwhelming, the Congressional Budget Office has estimated that if the same reforms were applied at the federal level, they would save $44 billion over a ten-year period. And because the evidence that those reforms increase access to health care is so overwhelming, they are supported by a huge variety of public safety and labor unions, community clinics and health centers, and organizations dedicated to disease prevention -- all of whom have seen the beneficial effects of these reforms in California. So popular are these reforms among the citizens of California that a ballot initiative to raise the damages cap, backed and funded by trial lawyers, was defeated by an over 2 to 1 margin in 2014. The bill before us today is identical to what was reported out of this committee two Congresses ago. And the HEALTH Act has passed the House many times, because the need for it persists. The HEALTH Act’s common-sense reforms include a $250,000 cap on noneconomic damages and limits on the contingency fees lawyers can charge. They allow courts to require periodic payments for future damages instead of lump sum awards so bankruptcies in which plaintiffs would receive only pennies on the dollar can be prevented. They include provisions creating a “fair share” rule, by which damages are allocated fairly in direct proportion to fault, and reasonable guidelines -- but not caps -- on the award of punitive damages. And the HEALTH Act does all this without in any way limiting compensation for 100% of plaintiffs’ economic losses, which include anything to which a receipt can be attached -- including all medical costs, lost wages, future lost wages, rehabilitation costs, and any other economic out of pocket loss suffered as the result of a health care injury.  Far from limiting deserved recoveries in California, these reforms have led to medical damages awards in deserving cases in the 80 and 90 million dollar range. The HEALTH Act also does not preempt any State law that otherwise caps damages. It’s well within Congress’ power to enact litigation reforms and there are many established precedents for doing so. For example, that’s what Congress did when it passed the Protection of Lawful Commerce in Arms Act in 2006, which provides protections from excessive litigation to those in the firearms industry. That federal law was upheld in federal court as coming well within Congress’ Commerce Clause authority. And when President Ronald Reagan established a special task force to study the need for federal tort reform, that task force concluded as follows: “In sum, tort law appears to be a major cause of the insurance availability [and] affordability crisis which the federal government can and should address in a variety of sensible and appropriate ways.”  Indeed, the Reagan task force specifically recommended “eliminate joint and several liability,” “provide for periodic payments of future economic damages,” “schedule [that is, limit] contingency fees” of attorneys, and “limit non-economic damages to a fair and reasonable amount.” All of these recommended reforms are part of the HEALTH Act. I urge my colleagues to support this legislation to enact common-sense litigation reforms in the health care context. Click here to learn more about today’s markup.