Measures are part of a package of legislation designed to help lower insurance rates
(The Center Square) – Two bills that would help cool Louisiana’s red-hot litigation climate passed with big majorities in the House of Representatives and are in a holding pattern in the Senate.
The Senate Judiciary A Committee that put the brakes on those two measures on April 30 amended another bill in a manner that has its sponsor recommending his chamber not concur with the changes.
These bills are part of newly-elected Insurance Commissioner Tim Temple’s package of tort reform and other legislation intended to help cut property and auto insurance rates, which have skyrocketed since three hurricanes made landfall in the state in 2020 and one, Hurricane Ida, in 2021.
Three of those bills are being carried by first-term lawmakers.
Rep. Michael Melerine, R-Shreveport, told The Center Square that Temple’s reform package needs to pass in its totality for it to have its intended effect.
“Depending on what parts of it pass, it could actually have the reverse impact of what is intended,” Melerine said. “Hopefully, we do as he asked and pass the entire package as it was introduced.”
His first-year colleague, Rep. Emily Chenevert, R-Baton Rouge, concurred with his assessment.
“If you piecemeal, you’re not going to hit the issue in a large way,” Chenevert told The Center Square. “The hope is to get some of these big pieces, including my legislation, to the finish line so we can have a business-friendly climate especially when it comes to the litigation process. Louisianans want big change. They want insurance rates to go down. They want us to do something about it.”
She also said failure to pass the package of legislation would result in a lack of progress on cutting increasing insurance costs for Louisiana residents.
Melerine sponsored House Bill 423, that was passed by the House with an overwhelming 78-vote majority on March 26.
The measure, which Melerine calls the “collateral source” bill, modifies awards in cases with recoverable medical expenses. At present, state law says a court must award to a claimant 40% of the difference between the amount billed and the amount paid to a health care provider to cover the claimant’s procurement costs.
The amount can be reduced if the defendant proves the cost recovery would make the award “reasonable.” In Melerine’s original bill, the 40% requirement would be eliminated.
Another key part of the measure is the elimination of a requirement that a jury only be informed of the amount billed by a provider. The bill would also strike a non-disclosure mandate to juries concerning whether another source has agreed to pay a claimant’s bill.
“It was one of the biggest issues that we’re trying to address was trying to have the amount that was billed, be admissible to the jury, and that was stripped out in committee,” Melerine said, adding that he’ll urge his comrades not to vote for concurrence with the changes and ask for conference.
House Bill 336 is sponsored by Chenevert and is known as the Litigation Financing Disclosure Act. It passed 84-17 but was paused by the Judiciary A Committee.
This bill would require plaintiffs or their attorneys to disclose all litigants any financing agreement that promises a third party a share from a settlement or award of damages. Nonprofit legal organizations, such as the Pelican Center for Justice, that seek only injunctive relief would be exempt.
“When I ran, there’s a few things that when you’re knocking on doors, meeting your constituents for the first time,” Chenevert told The Center Square. “I knocked on over 5,000 doors and people care about education and they care about insurance. And they care about crime.
“For me, I wanted to do something with great impact moving the state forward in any way I could and if there’s one thing I know, one thing we have to bring forward great change is insurance reform and tort reform.”
House Bill 24 is also sponsored by Melerine and would eliminate the ability of attorneys in personal injury cases to use a lack of a prior history of an illness or injury to create an impression that either were caused by the subject of a lawsuit.
It sailed through the House with a 75-25 vote on March 21, but it was deferred by the Judiciary A Committee as well.
“While some individual members have supported the legislation, the Judiciary A Committee has so far chosen to oppose or water down the bills to the point of uselessness,” Temple said in a statement. “I urge the members of this committee to support comprehensive auto insurance reform in the same way both chambers of the Legislature have shown support for property insurance reform. Let me be clear: If these auto insurance reform bills don’t move to the floor where the full Senate can debate them, our best chance for improvement in the auto market will have been killed in the Senate Judiciary A Committee.”
