The Virginia Trial Lawyers Association (VTLA) and the Medical Society of Virginia (MSV) have reached an agreement that would maintain an aggregate medical malpractice cap for the next 20 years, if approved by the Virginia General Assembly.

The agreement between VTLA and MSV provides for a $50,000 annual increase to Virginia's existing $2 million medical malpractice cap from July 1, 2012 to June 30, 2032. This represents approximately a two percent annual increase.

In addition, the agreement preserves potential avenues for further tort reform beyond the medical malpractice cap, including initiatives in the Patient Protection and Affordable Care Act. One such provision authorizes $50 million over 5 years, starting in FY 2011, for states to develop, implement and evaluate alternatives to current medical malpractice litigation.

The agreement comes after two years of negotiations between the groups and is in response to a directive issued by the General Assembly to develop a long-term solution to the state's unstable medical liability climate. VTLA and MSV leadership are currently informing key legislators and Virginia Gov. Robert McDonnell's office about the agreement, with the objective of introducing legislation during the 2011 General Assembly session. Pursuant to the agreement, VTLA will not initiate legislative efforts that would eliminate the total cap, amend the cap to apply only to non-economic damages or create a second cap within the total cap.

The Virginia Hospital and Healthcare Association -- a third major player in the state's healthcare industry -- also participated in the negotiations but did not enter into the agreement, taking the position that any agreement should address the incident review process as well as the cap.

LeClairRyan's healthcare attorneys remain hopeful that the agreed upon aggregated medical malpractice cap will be introduced to the Virginia General Assembly next year, recognizing that appropriate long-term limits would ensure continued availability of medical malpractice insurance while having a nominal effect on premiums.