NCPA - National Center for Policy Analysis

Republicans Scuttle Tort Reform Amendment

May 22, 2003

Tort reform is a major plank of the president's plan to reform health care. Unfortunately, Senate Republicans blew an opportunity to make progress on limiting excessive lawyers' fees, according to the Washington Times.

By a vote of 61-37, the Senate last Thursday rejected an amendment by Sen. Jon Kyl (R-Ariz.) to the tax-cut bill that would have capped the amount lawyers could receive when working on major tort cases for the government, such as in the anti-tobacco litigation.

Despite 14 Republican defections, Kyl's legislation was not radical or restrictive to the suing profession:

  • It merely would have confined the lawyers' cut of awards of more than $100 million to 500 percent of "reasonable hourly rates."
  • The law would have pared their pay to $2,500 per hour, down from the $100,000 an hour some currently are making on the tobacco settlement.

What makes these sums truly outrageous is that they come out of state coffers. In the 1998 legal settlement, tobacco companies were obliged to pay states $246 billion to go toward smoking-prevention programs and to repay years of tobacco-related health-care expenditures by states. The lawyers' take comes out of the total awarded to the states. The lawyers already have gotten $2.5 billion out of the deal, and are set to take in $500 million more annually forever.

If passed, the Kyl amendment would have freed up $9 billion from the tobacco-tax settlement alone. That cash would have stayed with the states, which could have used the money to manage their current budget crises. Instead, senators sided with trial lawyers over their own constituents.

Source: Editorial, "Tort reform, R.I.P." Washington Times, May 22, 2003.


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