The 54^th Arizona Legislature kicked off a very busy second Regular Session on January 13, 2020. On February 10, 2020, the Arizona Legislature cutoff the introduction of new bills. There are total of 1,581 bills pending before the House and Senate committees which must be heard by February 21, 2020. March 27, 2020, is the deadline for passed House bills to be heard in Senate committees and passed Senate bills to be heard in a House committees. The proposed bills cover a wide variety of subjects with potential impact on insurance defense litigation.

Product Liability Action Limitation

A simultaneous bill was introduced in the House and Senate which seeks to amend A.R.S. § 12-684 relating to product liability. The proposed bill would establish a list of circumstances under which a product liability action may be commenced or maintained against a seller that is not also a manufacturer of the product at issue. Under the bill, a product liability action may be commenced against the seller if the seller failed to exercise reasonable care in assembling, maintaining or repairing the product at issue; the seller made an express warranty regarding the product independent of any warranty made by the manufacturer; and the manufacturer has been adjudicated bankrupt and a judgment is not otherwise recoverable. The House and Senate bills have passed committee vote.

Expansion of Employment Discrimination

In the House, a bill proposing edits to employment discrimination statutes has passed committee vote. The bill would expand the class of individuals under the terms “because of sex” and “on the basis of sex” to include on the basis of pregnancy or childbirth or related medical conditions. Under the bill, women affected by pregnancy or childbirth or related medical conditions must be treated the same as other persons not similarly affected. This equal treatment would apply to all employment-related benefits, including receipt of benefits under fringe benefit programs.

Protection to Good Faith Emergency Acts

A bill in the Senate was introduced to limit the liability of those individuals who in good faith render emergency care or emergency assistance to any person injured as a result of a fall. This protection would exist whether or not the party offered assistance at the direction of an emergency dispatch operator. However, this protection would not be available if the person acted with gross negligence while rendering the emergency care or emergency assistance. The bill is currently pending a committee vote.

County and Municipality Notice Requirement

The proposed Senate bill would create a requirement for a county or municipality to notify all potential claimants of the obligation to file a notice claim. This requirement would exist if the county or municipality is aware of a potential claim or cause of action involving the county or municipality and the potential claimant has not filed a notice of claim at least 90 days before the notice of claim time frame expires. If the county or municipality fails to notify all potential claimants at least 90 days before the notice of claim time frame expires, the claimant has two years after the date the potential claim or cause of action accrues to file a claim. If passed, the bill would apply to cases in which the cause of action accrues after the effective date of legislation.

Limitation of Health Care Liens

The proposed Senate bill would limit the scenarios under which a health care provider may assert a lien. The bill would alter A.R.S. § 33-931 which details the lien of a health care provider on damages recovered by an injured person receiving services. It would also create a new statute for workers’ compensation matters. Under the bill, a health care provider may not assert a lien if the services provided are covered by health insurance unless the insurer denies coverage for the services or the patient owes a copayment, deductible or coinsurance, in which case the lien extends to the amount owed. The bill is currently pending committee review.

Limitation on Physical Therapists Liens

Another Senate bill is also pending committee which could effectively reduce the number of physical therapist liens. Under the bill, licensed physical therapists providing treatment to an injured person will be required to elect to claim either payment under available insurance coverage for the injured person’s treatment or payment under a lien. The physical therapist will be required to make this election before starting treatment for the injured person. Any payment received by the physical therapist pursuant to the election constitutes a full discharge of the injured person’s obligation to the physical therapist and no other claim may be made by the physical therapist. The exception being if the physical therapist elects payment under the injured person’s insurance, the injured person is responsible for any applicable cost sharing requirement.

TM Takeaway: These bills could have a potential impact on the handling of insurance defense litigation matters. We will continue to monitor these bills. Should you have any questions or like to discuss, do not hesitate to contact our office. We will be happy to speak with you.

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