One of the problems facing Iowans and employers in Iowa is affordable health care.  There are many factors that are responsible for the double digit increases in health insurance premiums over the last several years.  One of the reasons for the increases is due to the dramatic rise in liability insurance costs.  One major factor is the awarding of non-economic and punitive damages in medical malpractice lawsuits.  With liability insurance rates skyrocketing, access to certain groups of medical providers is becoming increasingly difficult.  Rather than face a future where Iowans have to travel significant distances for access to affordable health care, House Republicans have taken action to protect Iowa’s health care system.

The Commerce, Regulation and Labor Committee, of which I am the Vice Chair, passed out landmark legislation that would reform Iowa’s medical malpractice law.  House File 2202, as amended, would limit non-economic damages to $250,000 in lawsuits against physicians, hospitals, and nursing homes.  Non-economic damages are those damages that cannot be financially measured because they are subjective and non-quantifiable.  The bill would not limit actual damages or any punitive damages and, if actual malice can be proven, the cap on non-economic damages would not be in effect.

Non-economic damages have been a primary driver of the increasing costs for professional liability insurance.  While the numbers of lawsuits against Iowa physicians fall within the national average, the jury awards exceed the national average.  Thus, the market forces the liability insurance industry to drive up premiums in Iowa.  That is if you can get an insurance carrier to cover you.

Actions like those proposed in House File 2202 have had a positive impact on professional liability.  In other states that have passed similar laws, the cost of medical liability insurance has gone down.  According to information obtained by Representative Hoffman, who is one of the representatives on the Commerce, Regulation and Labor Committee, the rates for medical liability insurance in California went down by 40 percent since the passage of their medical malpractice reform bill.  Passing this bill is a major step in the right direction to lower the cost of health insurance premiums.

The House Commerce, Regulation and Labor Committee have lots of action and several bills that have been passed out of committee this year.  It is by far my favorite committee, especially when Chairman Jenkins floor manages a bill because then I get to chair the committee.  This committee deals with banking, real estate, insurance, labor, and communication issues.  All of these fields interest me and many I have first hand experience in.  The more we can all learn about our technological communication field will be an asset for the future, for this field has some real potential for economic growth here in Iowa.

We passed a bill out of committee this past week that sets up the framework to sell the ICN. This bill is a long way from becoming law and will require lots of work before it’s in a position to do so.  The ICN has never been used to its fullest potential and the state is having a difficult time finding the money to fund its future.  The other concern is that technology is changing so fast that the ICN will soon be out of date.  Selling the ICN does not concern me as much as who may buy the ICN. We need to be extremely careful, as a state, that we don’t drastically change the competition of the local telephone districts that have been such a great asset to our local communities.

Through the first eight months of the fiscal year, personal income tax receipts were up $74 million compared to this point in FY 03.  Sales and use tax receipts were up $6.1 million and other receipts were up $4.9 million.  Corporate income tax receipts continue to lag and are down $16.1 million (-11.3 percent) compared to FY 03.  However, even this figure is better than the REC estimate of -24 percent.

The economy is showing signs of improvement, we are improving the business climate in this state to create more jobs, and spring is just around the corner.

Until next time,

Tom Sands