Commentary

Let’s Cap the Damage to the Constitution

It’s that time again − the umpteenth attempt to cap medical malpractice awards since the Republicans took over Congress. Vice President Dick Cheney, speaking at the Medical College of Ohio, has reaffirmed the main plank of the GOP’s health care agenda: a $250,000 limit on damages to control “runaway litigation.” Never mind that conservatives are supposed to be champions of states’ rights and limited federal government. Those principles are apparently expendable when, to quote a senior party strategist, “most people in this country have some insurance and they’re worried about how much it cost.” After all, the Constitution should not be an impediment when voters want lower-priced insurance in an election year.

Of course, the Democrats, who rarely balk at congressional meddling, have their own version of a federal remedy. During the primaries, Sen. John F. Kerry (Mass.) unveiled his recommended medicine for abusive malpractice suits: federal sanctions against lawyers with a history of filing frivolous litigation. That answer, cynically crafted not to offend the plaintiffs’ bar, guarantees that big bucks from the attorneys will continue their flow into party coffers.

Well, even if votes for the Republicans and money for the Democrats are the real motives behind the competing pitches, doesn’t the Constitution itself expressly provide that Congress can regulate interstate commerce? Indeed, it does. But legitimately to invoke the Commerce Clause, Congress must show that federal reforms are “necessary” and “proper” to ensure the free flow of interstate trade. When it comes to medical malpractice, neither criterion ha been met. Federal reforms are not necessary because the states are enacting their own reforms. Federal reforms are not proper because they cannot be harmonized with time-honored notions of federalism.

Not every national problem is a federal problem. State legislators, courts, doctors, and their patients are not powerless. More than three dozen states have passed damage caps. All 50 states have passed, or are considering, various tort reform proposals.

Mississippi is a case in point. Two years ago, the U.S. Chamber of Commerce warned its members to avoid Mississippi’s “jackpot justice.” Doctors fled or quit, 71 insurance companies pulled out, and the state lost an $800 million bid for a Toyota plant after company executives wrote that “the litigation climate … is unfavorable.” The result: a new law, effective September 1, that caps pain-and-suffering, medical malpractice, and punitive damages. There’s even a provision to rein in “forum shopping,” a favorite tactic of the trial lawyers. Plaintiffs in Mississippi will have to file suit only in the county where they live or where an injury occurred. Not bad for a state that became infamous as a “judicial hellhole.”

The Commerce Clause empowers the federal government to “regulate Commerce … among the several States.” According to constitutional scholar Randy E. Barnett, that raises three obvious questions: What is commerce? What is among the states? What is to regulate? “Commerce” means the exchange of goods, including their transportation. “Among the states” means between persons of one state and another. “To regulate” means to make regular; that is, to decide how transactions can occur in an environment freed of state-imposed impediments.

Suppose we reject those definitions and adopt the broadest possible meanings. Suppose “commerce” means any gainful activity. “Among the states” means anywhere in the nation, even wholly within a single state. And “to regulate” means not to remove state restrictions, but to impose federal restrictions. Applying those new definitions, the Commerce Clause would allow regulation of any gainful activity anywhere in the United States. But still, the Commerce power would not stretch to include non-commerce − activities like lawsuits designed to prevent and redress injuries, not to regulate trade.

That’s especially true when we’re talking about malpractice suits, in which the litigants − both plaintiffs and defendants − are typically from the same state. Nowhere in the Constitution - or in its “emanations and penumbras” - is there a federal power to set rules that control lawsuits by in-state plaintiffs against in-state doctors for in-state malpractice. Some of the damage awards may be shocking. But they are not commerce and they are not interstate.

If the Commerce Clause applies to anything that may occasionally cross a state line, then it applies to virtually everything. That may be the Supreme Court’s current view, but it wasn’t the Framers’ view. If necessary, let’s amend the Constitution. But far better, let’s restore sanity to state tort law — grounded in common law, supplemented by state legislatures, interpreted by state courts (or by federal courts applying state law). Unlike damage caps, that solution may not be politically appealing. But at least it’s constitutional.

Robert A. Levy is senior fellow in constitutional studies at the Cato Institute.