Gov. Bev Perdue today vetoed Senate Bill 33, the Medical Malpractice Reform bill.

The final version of the measure would have expanded legal protection for health-care providers treating an “emergency medical condition.” It also would have split the liability and damages phases of suits where damage claims exceed $150,000.

And, in its most controversial section, S33 would have capped noneconomic damages (outside of loss of future earnings) at $500,000, even for death, paralysis, brain damage, or disfigurement, unless the patient can prove “reckless disregard,” “gross negligence,” or intention or malice – standards that are extremely difficult to meet in most cases.

What’s interesting is that this appears to have been a mistake.

The House version of the bill made the damage cap exemption an either/or situation – either the patient was killed, disfigured, paralyzed, or etc., OR the victim could prove reckless or willful negligence.  But when the bill came back as a conference report, the “or” had turned into an “and.” In other words, both criteria would have to be met in order for the $500,000 cap to be lifted.

House lawmakers complained about the change during floor debate, but passed the measure anyway on the evening of crossover, June 9th.

Supporters of the measure, most notably the NC Medical Society, said the reforms in it were needed to bring more medical providers into the state and to lower malpractice rates. They argued awards should be set by lawmakers, not juries, who sometimes make decisions based on emotion and sympathy. And they pushed for greater protections for emergency care because those providers can’t choose their patients – they have to care for anyone who walks through the ER door.

But the bill’s critics, most notably the NC Advocates for Justice (trial lawyers), argued the state’s constitution clearly states a jury should decide awards in damage cases. They said there’s no evidence that damage caps lead to lower malpractice rates. And they said the noneconomic damage cap would hurt those most vulnerable – children, homemakers, elderly and disabled people who wouldn’t be able to prove economic damages for “loss of future earnings.”

The veto is Perdue's ninth.

Her veto message, tucked into an announcement she had signed Tort Reform and Workers' Comp Reform bills today:

“I am strongly committed to passing meaningful medical malpractice reform. Doctors, hospitals and nursing homes in North Carolina are all being burdened by medical malpractice insurance rates that are too high.

“By working together, we enacted meaningful changes to our tort law (H.B. 542) and our worker’s compensation system (H.B. 709) this year. We can achieve real medical malpractice reform as well. I commend the legislature for addressing this important issue but, in its current form, the bill is unbalanced. I urge legislators to modify the bill when the General Assembly returns in July to protect those who are catastrophically injured. Once the bill is revised to adequately protect those that are catastrophically injured, I will proudly sign it into law. I pledge to continue working with the General Assembly to achieve a comprehensive, bipartisan consensus.”

S33 now goes back to the Senate.