By Warner Todd Huston ——Bio and Archives--July 22, 2010
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The July 6, 2010 verdict against Skilled Healthcare Group Inc. and subsidiary Skilled Healthcare LLC is outlandish, excessive and extreme. The $671 million award of damages is disproportionate to the facts of the case. It’s a by-product of a series of unprecedented and erroneous rulings of law by the trial judge, and a jury that applied the flawed rulings to the maximum extent. These maximum damages were applied over a six year period to every patient in the 22 skilled nursing facilities, regardless of whether they were named in the complaint. More importantly, the allegations specifically excluded any assertion of harm.Gomez also laments that if the judgment stands the healthcare company will be forced to close its doors causing the loss of thousands of jobs and putting the healthcare of thousands of patients in jeopardy. And Gomez also reports that Skilled Healthcare LLC is "widely regarded as a good provider of skilled nursing care in California and elsewhere." The case, now concluded, is going into a mediation phase and the company hopes that the award will be lowered to one it could actually pay instead of the punitive one that they now face. In the end this trial is evidence that this country needs some major tort reform. Here we had a company that was going about its business, and by all accounts has a good reputation in its industry yet found itself with a multi-million dollar award levied against it because of some trial lawyers that went ambulance chasing to float a class action lawsuit. And now thousands of people's healthcare and livelihood is in jeopardy. What are all theses elderly patients supposed to do if the company is forced to fold? And what of all the jobs lost in this, one of the worst economies in decades? If the company was violating state regulations on the required number of nursing staff to patient ratios, then, sure, the state should force it to comply with regulations. No one would deny that fines of some sort would legitimately be part of such a finding. But this $671 million award is not corrective, it is destructive. And what unforeseen consequences might this award have in the healthcare industry throughout California and the rest of the country? Will it drive costs up? Will it cause smaller healthcare facilities to just close up shop for fear of giant, punitive awards for minor infractions? And what other industries might next be a target of this class action feeding frenzy? Questions that we would not be faced with were it not for an out of control tort system.
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Warner Todd Huston’s thoughtful commentary, sometimes irreverent often historically based, is featured on many websites such as Breitbart.com, among many, many others. He has also written for several history magazines, has appeared on numerous TV and radio shows.
He is also the owner and operator of Publius’ Forum.