Because municipalities are seen as arms of the state, nearly every municipality has immunity from tort liability. Historically, this immunity has extended to provide immunity from medical malpractice suits to municipal hospitals. Under the theory of municipal immunity, municipal hospitals may not be sued for medical malpractice because the hospital is performing a governmental function. For example, an Illinois act bars suits against municipal hospitals and their employees for any acts taken in the course of their employment with the hospital. This means that a physician employed by a municipal hospital cannot be sued for medical malpractice regardless of the salary the physician earns in connection with his or her employment.

In the past few decades, legislators have recognized that hospitals, including municipal hospitals, usually generate profit. In light of the profit-making capabilities of municipal hospitals, legislators and policymakers in many states have decided that it is unfair to shield municipal hospitals from malpractice liability. As such, many states have abrogated tort immunity for municipal hospitals.

A number of states have passed laws abrogating tort immunity for municipal hospitals.

For example, Alabama law has abolished immunity for all government entities. States such as Texas and Missouri have abrogated immunity for medical malpractice but have kept immunity under certain circumstances, such as injuries occurring as a result of the operation of a motor vehicle or as a result of a property's condition. Tennessee has waived immunity for municipal hospitals in cases involving the negligence of governmental employees acting within the scope of their employment.

Other states have passed laws limiting the amount a plaintiff can be awarded in a medical malpractice action against a municipal hospital or its employees. For example, in Florida, a plaintiff is limited to recovery of $100,000 for a claim against a municipal hospital or its employee. However, if the hospital or its employee have malpractice insurance, the immunity is waived up to the amount of the insurance coverage. Massachusetts also limits liability to $100,000 for claims against municipal hospitals. Employees of Massachusetts municipal hospitals are not, however, entitled to the immunity protection.

It is clear that the trend in many jurisdictions is to allow government entities and their employees to be held liable for acts of medical malpractice. As such, plaintiffs will increasingly be able to maintain malpractice actions against municipal hospitals and their employees. With the increased emphasis on tort reform, however, limitations on damage awards in these cases may be capped as they are in malpractice actions against private entities.

Copyright 2010 LexisNexis, a division of Reed Elsevier Inc.