Gov. J.B. Pritzker (D)

After vetoing a bill that would have allowed lawyers to collect 9% pretrial interest in medical malpractice cases, Illinois’ governor appears poised to give his blessing to a compromise version that lowers the rate.

Healthcare provider associations have lambasted the proposals, saying permitting prejudgment interest gives the plantiff’s bar reason to drag out cases and will increase healthcare costs across sectors.

“The Nursing Home industry has long been disproportionately penalized throughout the litigation process in Illinois,” said Adam Guetzow, an attorney with Hinshaw & Culbertson, who represented LeadingAge Illinois in negotiations with Gov. J.B. Pritzker (D). The original bill “incentivized plaintiffs and their attorneys alike to delay commencement of legal actions to the outer end of the statutory limitation period, by allowing the pre-judgment interest to accrue from the date of injury.“

On Thursday, Pritzker vetoed Bill 3360, which could apply to any personal injury or wrongful death suit “involving negligence, willful and wanton misconduct, intentional conduct, or strict liability of the other person or entity.”

The governor said he would support joining a majority of states that already allow prejudgment interest in personal injury cases “to encourage their prompt resolution.” But he argued the bill would be burdensome for hospitals and medical professionals “beyond the national norm, potentially driving up healthcare costs for patients and deterring physicians from practicing in Illinois.”

Some states with prejudgment interest, including Michigan and Wisconsin, tie the interest rate to market conditions such as the federal prime rate, as opposed to a flat rate. The proposed 9% flat rate was higher than many market-based rates adopted by other states.

Illinois State Medical Society President Robert W. Panton, M.D., said his organization was “deeply disappointed” that a second, similar bill backed by the plaintiff’s bar passed the Illinois General Assembly on the same day Pritzker announced his veto.

It imposes a 6% percent prejudgment interest penalty.

“This is a wholly new form of ‘punitive’ damages not previously allowed in Illinois,” Panton said. “Prejudgment interest will drive up the cost of medical liability insurance, force doctors away from our state and increase the cost of healthcare. Bottom line, patients will suffer.”