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Schiavo v. John F. Kennedy Hospital

Decided: July 17, 1992.

LARRY SCHIAVO AND JOAN SCHIAVO, HUSBAND AND WIFE, PLAINTIFFS-RESPONDENTS,
v.
JOHN F. KENNEDY HOSPITAL; DEFENDANT-APPELLANT, AND DR. GERALD MONTICOLLO; MICHAEL SPIVAK, D.O.; AND DR. LEVIN AND/OR JOHN DOE, M.D., A MEDICAL PROVIDER, DEFENDANTS



On appeal from the Superior Court of New Jersey, Law Division, Camden County.

King, Dreier and Gruccio. The opinion of the court was delivered by King, P.J.A.D.

King

The opinion of the court was delivered by

KING, P.J.A.D.

We granted this motion for leave to appeal, R. 2:2-3(b), by John F. Kennedy Hospital, to resolve the issue of the retroactive effect of N.J.S.A. 2A:53A-8; L. 1991, c. 187, § 48, effective July 31, 1991.*fn1 This is the amendment to the charitable immunity act, N.J.S.A. 2A:53A-8, which increased hospital liability from a maximum of $10,000 to $250,000. A recurrent issue in the trial division has been whether the increased liability limit applies to claims accruing prior to the July 31, 1991 effective

date. We conclude that it does not. The increased liability limit applies only to claims accruing on or after the effective date of the amendment.

This appeal arises from an order entered in the Law Division on February 21, 1992, after a motion brought by appellant hospital to limit its liability in this action to $10,000 because the claim arose on January 8, 1988, well before the effective date of the amendment enhancing potential liability to $250,000. The claim arose from an alleged negligent failure to diagnose "a biceps tendon rupture" while plaintiff was an emergency room patient at the hospital on January 8, 1988. The complaint was filed on January 8, 1990, two years later, to the day.

The Law Division Judge denied the hospital's motion. He concluded that since "there is nothing in the act that says it does not apply to causes of action which arose prior to the date of the act," it should have retroactive effect to claims pending on the effective date. We disagree.

The charitable immunity act relating to nonprofit hospitals was amended by § 48 of L. 1991, c. 187, as part of the comprehensive "Health Care Cost Reduction Act of 1991," see generally N.J.S.A. 26:2H-18.24 to -18.50. This act consisted of extensive and detailed legislation aimed at "health care cost containment." Id. at preamble. Included in the Act were plans for the allocation of costs for uncompensated care; the establishment of a health care cost reduction fund and regulated health care services; the purchase of major equipment; the referral of patients; the regulation of health maintenance organizations, and related concerns.

This legislation germinated in substantial part from the October 1, 1990 Report of the "Governor's Commission on Health Care Costs" (Commission Report). See Assembly Appropriations Committee Statement, Senate No. 3251; see also Transcript and Appendices of Public Hearings before Senate Institutions, Health and Welfare Committee, November 14, 1990. The Commission Report, supra, at 37-38, recommended certain

reforms in medical malpractice law. These proposed reforms addressed both cost and quality concerns. Among the recommendations for improving quality was Commission Recommendation 81(b) which said: "The $10,000 limitations on hospital liability should be reviewed to determine whether their repeal would provide a meaningful ...


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