Archive for the ‘Tort Reform’ Category

Study Finds Differences Among Doctors, Risk Managers in Admitting Errors – Joint Commission Resources – Answer: Just Tell the Truth!

April 4, 2010

The Joint Commission Journal on Quality and Patient Safety recently issued a report on how Risk Managers (those who handle claims in hospitals as part of their duties) vary from physicians in admitting errors.  The report was based on anonymous surveys of nearly 3,000 risk managers and roughly 1,300 physicians.

Some of the key findings from this survey were as follows:  

  • Risk managers have more favorable attitudes about disclosing errors to patients compared with physicians
  • Risk managers were less supportive of providing a full apology
  • Risk managers expressed more favorable attitudes about the mechanisms at their hospitals or health care organizations to inform physicians about errors
  • Both Risk Managers and physicians agreed that there is a lot of room for improvement in systems to report errors.

The news release issued by the Joint Commission then contains the following quote:

“Fulfilling patients’ expectations for full disclosure of medical errors remains a complicated process. Our data offer additional insight into the complexities of these conversations and reflect the evolving roles of stakeholders beyond the physicians involved in the error,” says lead author David J. Loren, M.D., Assistant Professor of Medicine, Division of Pediatrics, at the University of Washington, Seattle, Washington.

Why is it so complicated?  This past Friday, I reported on an article from the New England Journal of Medicine, in which the concept of acknowledging wrongdoing early in the process is central to current programs to minimize litigation costs and seek alternative methods of coping with “national tort reform legislation.”

If physicians and risk managers only had some idea of how many people we interview for potential claims and lawsuits, who are seeking legal assistance because they ‘just want to know what happened’ or who are just plain angry because no one would talk to them about what went so terribly wrong or even ,in some instances, flat-out lied to them about what happened, they might not need to do a study to conclude – there is a “lot of room for improvement.”

I know – it’s fear of lawyers that leads the health care industry to have such angst over just telling the truth.  What they don’t get is that we, the lawyers, would probably have a lot less people calling us to investigate their claims if someone had just taken the time to figure out what went wrong and told the patient and/or the family the truth.

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Malpractice Reform — New England Journal of Medicine – New Alternatives Analyzed

April 2, 2010

There is a thought-provoking article in the New England Journal of Medicine entitled “Malpractice Reform — Opportunities for Leadership by Health Care Institutions and Liability Insurers,” which was posted online on March 31, 2010.  In essence, the authors suggest that health care institutions and insurers not wait for national tort reform legislation (“a political gridlock”) but rather become leaders in the development of alternative methods for “providing compensation for medical injuries.”

While the concept is somewhat intriguing, the methods discussed are in many instances nothing but a privatization of tort reform at its worst. Each “alternative method” will be examined seriatim.  

The overall concept seems to be rooted in what is commonly referred to as the “disclosure-and-offer” approach.  Three models are discussed: the reimbursement model, the early-settlement model and health courts.

Please refer to the article itself for a more thorough description of these models.  The length of this blog is concerning enough.

In essence, with the “reimbursement model, institutions offer to (as the name denotes) reimburse patients for some out-of-pocket expenses related to the injury and for “loss of time.”  Typically, there are pre-determined limits for each category,which often are $25,000 for expenses and $5,000 for loss of time. Clear cases of negligence, fatal injuries, cases that are the subject of a lawsuit or where an attorney is invovled are excluded from the program.  There is no investigation into “possible provider negligence” in this matters. Patients who accept money do not waive their right to sue.

As a general comment, this plan makes the most sense but does not really deal with the infamously named “malpractice crisis” to any large extent.  First, most cases of medical malpractice that make their way to the courthouse could not conceivably fall within these financial parameters.  If a malpractice lawyer takes on a case with $30,000 in special damages (economic losses such as medical bills and lost wages), that lawyer needs to reassess their intake procedures. Given the economics of costs of litigation (not fees), mandatory reimbursements such as Medicare and Medicaid, liens from private insurers and the like, it would be foolhardy for a lawyer to become involved in such matters since the client’s net recovery would be non-existent.  What does make sense, however, is no-fault reimbursement to patients with minor, non-permanent injuries as a sign of goodwill by the providers of health care.  In that respect, the “reimbursement model” is a good program – given its express limitations.

Another major defect in this “reimbursement model” is the premise that there is no “investigation into possible provider negligence.”  If I am reading this correctly (none of the hospitals with which I am familiar in our geographical area have such plans presently; therefore, I am not certain how this works), the risk manager or claims person simply decides to write-off the loss as potentially a cost-savings measure.  One of the positive features of our current litigation system (when meritorious cases are brought) is that it does serve to correct errors in the health care delivery system.  When a major injury case is brought, many valuable lessons are learned by providers of health care.  Whether there is a “system problem” or just a dangerous method of practice at play, people do (unless they are completely arrogant and/or dense) learn lessons so that other patients do not suffer the same harm. One of the goals of the medical profession in analyzing, handing and resolving cases of medical errors is to identify problems and take steps to correct those problems for future injury avoidance.  An entire essay, rather than a blog, could be devoted (and maybe will be) to this concept of the health care industry policing itself through conscientious, rigorous self-appraisal and correction when wrongs are identified.

The “early-settlement” model is described in the NEJM article as follows: “no preset limits on compensation,” but compensation is not offered unless the institution, “after an expedited investigation, determines that the care was inappropriate.”  Offers may include compensation for all elements of damage – economic as well as non-economic (e.g. pain and suffering) damages.  To accept the money, the patient must agree that such payment constitutes a “final settlement” – thus obviating the bringing of a lawsuit.

More research into this ‘early-settlement” model is called for since the NEJM article does not go into other critical details associated with such an approach.  Since the model was “pioneered by the self-insured University of Michigan Health System,” I intend to devote a separate writing to this program once more research on its possible limitations and efficacy has been accomplished.

Suffice it to say for the present that if such a model precludes attorney involvement, then this is a fatal flaw.  The reason individuals come to a lawyer when tragedy occurs in the medical context is because those of us who specialize in this area of law know and understand (1) what  proper claims should be made and (2) what the fair and reasonable parameters of just compensation are for the victims of medical malpractice.  Sure, one can take a jaded approach and scoff – “All the lawyer wants is a fee and that’s why you are against this model”  Simply not so.  A substantially reduced fee arrangement may well be in order in such instances.  If the client is at least properly represented and the case is handled expeditiously and the compensation is fair and reasonable, then I for one believe that a reduced fee is in order which would further benefit the patient/client.

That’s not the full story, however, when it comes to discussing this so-called model.

In our current system of medical malpractice litigation, the system would work a whole lot better and be much less expensive and be much more efficient if these same principles were applied to the current claims handling practices of insurers and self-insured health care providers.

One of the largest drawbacks  for both the health care system and for the patient/client are the costs associated with medical malpractice litigation.  I recently wrote a blog regarding the issue of costs and their effect on the so-called malpractice crisis.  When clear-cut cases of medical negligence exist and are ignored or denied by risk management or insurance claims  personnel, the costs sky-rocket.  The health care insurer or provider hires counsel at an hourly rate to defend the case.  Discovery in the form of record production, depositions and the like proceed with sickening and dollar-wasting frustration for the plaintiff lawyers and their clients.  Cases slog along unmercifully through the system for months if not years. If you have a clue what you are doing as an experienced medical malpractice lawyer, you have a pretty good sense of what cases have merit and which do not.  Of course, no one is infallible, but for the most part, “good cases almost try themselves.”

Applying the principles of the “early settlement” model to what exists in today’s world of medical malpractice, I suspect that nationally, on an annual basis, billions of dollars would be saved in ridding our system of the needless waste of money in defending cases that should have been resolved early in the process.  Why not take the principles of this model and apply them to what exists in the current system?  That’s what the health insurance industry should have been doing years before now.  Did they need a new “model” to tell them that? If insurers took a more responsible approach by fairly and honestly assessing these cases and did so in an “expeditious” fashion, our courts would not be clogged with needless litigation, the health care industry would save enormous amounts of money, and – most important – patients would be justly and timely compensated.  If only the public knew just how much waste there is in our current system due to the lack of due diligence and timely claims handling, they would perhaps have a more balanced approach to this ‘discussion’ of tort reform.

Institutions and insurers that are responsible in their claims handling practice are not the problem.  Fortunately, in my work for  years as a defense lawyer, I had the privilege of working for one such organization. Unfortunately, they are not in the majority.  I would love to see figures of defense costs (fees and expenses) on those cases that are ultimately settled or unsuccessfully defended.  I have zero doubt that those numbers are staggering.  If those fees and costs were substantially reduced through conscientious and timely claims handling, we might well not be having this discussion of tort reform in the first place.  When critics say blame the plaintiff lawyers – they may have half the phrase right – just not the right adjective.  A fuller discussion of the abject waste due to poor claims handling and delaying tactics by the defense bar is the subject for future consideration.

Finally, the infamous option of the ‘health courts.’  Succinctly stated (in the interest of relative blog-brevity), the essentials are described in part as follows:

A panel of experts, aided by decision guidelines,determines whether the injury was avoidable — a determination that turns on whether the injury would ordinarily have occurred if the care had been provided by the best specialist or an optimal health care system; the avoidability standard is more generous than the negligence standard. For avoidable injuries, the institutionoffers full recompense for economic losses plus an amount for pain and suffering according to a predetermined compensation schedule that is based on injury severity.

Various alternatives for this model are discussed in the NEJM article and include items such as making the program voluntary, permitting limited appeals to some extent and so on.  As one reads further, however, repugnant elements start rearing their ugly heads.  Just some of these components of the ‘health court’ system proposal are (1) waivers of the right to file a lawsuit “as a contractual condition of receiving care,” (2) so-called “decision guidelines,”  and (3) “predetermined compensation schedules.”

Waivers of right to a jury trial as a condition to receiving care screams “void for being against public policy.”  Who is advising a patient in need of care what his or her rights are when signing a waiver. Can’t you just picture the following scenario?  Mr. Jones is clutching his chest in the ED and before care is rendered he’s asked, “Would you like to receive care here?  If so, you will need to sign this waiver form.”

Predetermined schedules of compensation?  Is this a euphemism for contractually created caps?

The NEJM article raises some valid issues and concerns. A great deal more thought of how to fix the system is warranted.  The answer may well  lie in the underlying approach being advocated in the article – malpractice reform should be self-initiating for health care institutions and liability insurers.  They should take a leadership role and not sit passively on the sideline shouting the same old song – “We need caps….Our system is about to crumble…It’s all the fault of the greedy plaintiff lawyers!”  Maybe a new model is in order – grab a mirror and examine how to better police your own claims-handling practices.  Stop wasting everyone’s time and money through poor claims practices.  Expeditiously and honestly assess claims.  Offer fair compensation early in the process.  Maybe if the health care and insurance industries tried fixing their own practices in the framework of the current system of civil justice, these endless calls for restricting injured patient’s rights might stop and the so-called crisis just might be averted.  Ever consider working with the plaintiff malpractice bar….or is just a lot easier blaming them?

Tort Reform – Consider the Consequences – Lesson #1

March 28, 2010

Lost in all of this discussion about how tort reform and caps on damages will save the medical profession has been a discussion of what is really behind all this nonsense.  The Republicans claim that the reason the healthcare system is broken is because of the rising costs of malpractice insurance due to high verdicts, ‘out of control’ juries, the plaintiff lawyers and every other specious argument that sounds good but has no basis in reality.  Study after study has demonstrated that jurisdictions with caps do not affect malpractice insurance rates.

Has anyone really thought about why these naysayers are incessantly calling for a cap of $250,000 on non-economic damages?  It’s a simple matter of mathematics.  This number is not based in any reality of insurance rates – now is it?  Have you seen a single study that uses this ‘magic number’ to demonstrate how this will save healthcare?  If you have, please share it with the rest of us.  That comment will be posted in a heartbeat.

So what is behind this ‘number’?  What is the usual contingent fee being charged these days – 33 1/3 or 40 percent?  How much does it cost to investigate, file and try to conclusion a medical malpractice case of any consequence?   Answer: it can range anywhere from $75,000 to $150,000 (rough averages but pretty accurate). What is the largest cost?  Answer:  medical experts, who charge anywhere from typically $350 to $1,000 per hour.  What part of the population typically receives less than optimal (read ‘Cadillac’) care – answer: lower income patients without any coverage or without ‘the best coverage. ‘ When those patients seek care, how are those bills often financially covered?  Answer:  Medicaid or Medicare.  Do you have any understanding of what a ‘super lien’ is?  Answer: Medicare and Medicaid have an absolute right to complete reimbursement of any related medical expenses paid out in such cases.

So how do all these numbers, issues and forces play out in the real world of medical malpractice? What effect would a cap of $250,000 on non-economic damages have on whether a bona fide lawsuit (read: awful care causing serious injury) could ever be brought to court?

So that this posting can stay within the realm of reason in terms of length, I’ll just give you the above factors to ponder for a bit.  Later posts will give you more concrete examples of how, in the real world of malpractice cases, these specious arguments for caps and ‘tort reform’ are nothing more than an attempt to deny patients and their families of access to the courts.

Let’s leave you with a thought – a patient on Medicaid receives awful medical care leading to horrible injuries requiring hundreds of thousands of dollars in past and future care needs.   What do you think a client would recover in such a situation under ‘tort reform’ and a cap of $250,000?

Recovery of those costs do not go to the patient but are the subject of a reimbursable lien.  That potentially leaves recovery for non-economic damages only.  Apply a fee of one-third (answer:  just over $80,000) and costs of (let’s say) $125,000 (totally within the ‘usual’ range).  Have you done the math?  That’s about $45,000 to the client.  How does a lawyer satisfy a client’s needs in that scenario?  You can’t.  Do you do the case ‘on the cheap’ and not hire the experts or do the discovery you need to do?  You can’t – that runs of the risk for the client of not winning – in which case the recovery is nothing.

Now are you starting to get the picture what is really behind the proposed ‘tort reform’s cap’?  Don’t think for one minute that the medical profession and its insurers haven’t done the math.

More to come….

Ga. Supreme Court Upholds Key Medical Malpractice Law Requiring Proof of Gross Negligence for Emergency Room Physicians

March 17, 2010

Another legal ruling in the ongoing debate over tort reform – this one from the State of Georgia. MSNBC is reporting (citing Associated Press) that the Georgia Supreme Court, in a divided 4-3 opinion, has upheld a 2005 state law that requires patients to prove “gross negligence,” rather than ordinary negligence, in order to prevail in a medical malpractice case against emergency room physicians.

A Georgia woman, who suffered a stroke after receiving allegedly negligent treatment at an emergency room, challenged the constitutionality of the 2005 law, claiming that it created an insurmountable hurdle at trial.  The Georgia Supreme Court disagreed.

The court’s majority opinion, penned by Justice George Carley, found that it was “entirely logical” for lawmakers to approve the legislation in hopes of stemming the rising cost of medical malpractice insurance.

Usually, the focus of tort reform legislation has been in either instituting a cap on damages, or restricting attorneys’ fees, or both. In 2005, however, the Georgia legislature implemented an additional mechanism that was designed not to limit the amount of recovery in successful lawsuits but was instead specifically designed to make it more difficult for injured patients to prove their case at trial.

Prior to the law enacted in 2005, in order for a patient to prevail in a medical malpractice action, the patient had to be able to prove that the defendant doctor was negligent – i.e. violated the standard of care, which has usually been held to mean that the doctor failed to do what a reasonably competent doctor would have done in the same or similar circumstances. Under the new law in 2005, however, patients were required to prove that the defendant doctor (at least in the emergency room setting) committed “gross negligence,” which is a much higher level of negligence, generally defined as near-total disregard for the rights of others, reckless disregard, or willful or wanton indifference to the consequences of one’s actions.

Clearly, forcing patients to meet this higher burden will make it more difficult for injured patients to sue emergency room physicians, which was the very intent of the Georgia legislature. The ruling also means that negligent doctors who would have been found liable under traditional law will now get off scot-free, leaving injured patients with no recovery.

The same court is expected to rule later this month on the constitutionality of Georgia’s cap of $350,000 on damages for pain and suffering.

Maryland’s Cap and a Message from the former MAJ President re the Goings-On in Annapolis

March 13, 2010

Normally I don’t post materials from my News Feeds on Facebook – however – when you see a particularly well written piece that needs to ‘get out there,’ I make an exception.  The following is a wall posting from the past President of the Maryland Association for Justice, Wayne Willoughby.

by Wayne M. Willoughby                            
Past President, Maryland Association for Justice

In 2004, hysteria struck Annapolis. Hordes of physicians in white coats descended upon the State House demanding so-called “tort reform” as the fix to their rising malpractice premiums. The Maryland Association for Justice (then known as the Maryland Trial Lawyers Association) stood virtually alone in opposing the fear-driven throng.

MAJ retained a highly respected insurance analyst, Jay Angoff, to examine the recent malpractice premium hikes. Mr. Angoff was the third-longest serving insurance commissioner for the State of Missouri and previously had served the State of Maryland as the State’s insurance expert in other matters. His conclusion: the malpractice premium increases that caused the panic were totally unjustified; the doctors were being gouged by their insurance carrier.

So, MAJ advised the members of the General Assembly that they were being hoodwinked. What was needed was aggressive insurance regulation to prevent carriers from gouging doctors, not new laws depriving injured patients of full and fair justice in our courts.

Nevertheless, swept up in the frenzy, the General Assembly enacted House Bill 2 containing a premium subsidy for physicians and some measures that severely punished injured patients. One such measure lowered the damage cap on wrongful death and survival claims to the point that the life of a malpractice victim in Maryland is now worth at law only 50% of the life of a victim of other forms of negligence.

Time proved MAJ was correct, the malpractice “crisis” of 2004 had been a cruel hoax on the public and the General Assembly. Within seven months after passage of HB 2 – years before HB 2’s tort “reforms” could affect claims payouts and premiums – Maryland largest malpractice carrier, Medical Mutual, announced it would not increase premiums for 2006.

For 2007 the carrier lowered its base premiums by 8% and announced a $68.6 Million dividend for its insured physicians. With a new consumer friendly Governor in office, and his new insurance commissioner at the helm, Medical Mutual’s move was greeted by the Maryland Insurance Administration with a cease and desist order.

As a result, the taxpayers of Maryland were able to recoup from Medical Mutual the approximately $84.Million that had been paid to the company for rate stabilization under HB 2. Medical Mutual’s finances were so superb that it still issued a $13.8 Million dividend to physicians and lowered its premiums 8% for 2008 despite paying $84 Million back to the State.

Then, in 2009 Medical Mutual lowered its premiums by 31% (an 11% base premium reduction and a 20% dividend for renewing physicians). Again, in 2010, Medical Mutualannounced another 31% premium reduction (11% plus 20%).

Consequently, the events after the 2004 Special Session demonstrate the truth of what MAJ has said all along: The “crisis” of 2004 was no crisis at all. It was little more than a raid on the public treasury and the legal rights of injured patients accomplished though the use of fear to manipulate public opinion and the legislature.

Although the taxpayers of Maryland have been made whole because of the decisive actions of Governor O’Malley’s insurance commissioner, and doctors have access to “available and affordable” insurance (per the official Maryland Insurance Administration’s report), there is one group that has not been made whole from the damaging effects of the contrived crisis of 2004: injured patients.

Now pending before committees of the General Assembly is a cross-filed bill to rectify this situation. House Bill 622/ Senate Bill 769 will return the damage cap on medical malpractice claims to their pre-hoax levels. If this bill is enacted, injured Marylanders once again would be treated the same under the law irrespective of whether their injury resulted from negligent medical practice, negligent driving, or a defective product.

All people who believe in civil justice should contact the members of the House Judiciary Committee and the Senate Judicial Proceedings Committee and demand that they vote in favor of HB 622/SB769.

Keep up all your hard and good  work, Wayne.

Tort Reform – Tennessee Style: ER doctors back bill ‘redefining’ malpractice – NO KIDDING!

February 21, 2010

As I was going through the listings and hashtags on my TweetDeck yesterday, I came across this tweet from a report in a Tennessee online publication – Emergency doctors back bill redefining malpractice | tennessean.com | The Tennessean. While I don’t practice in Tennessee, any trend in legislative changes affecting a patient’s right of access to the legal system is on my watch list.  

Here’s the essence of the proposed legislation according to this article:

Under the bill filed last month, the definition of medical malpractice would be changed from “negligence” to “gross negligence,” which would raise the bar for mistakes that could trigger a lawsuit.

To put this in context, Maryland and the District of Columbia, where I am licensed to practice, have many times defined “gross negligence.”  Those definitions are precisely what caused a chill to run up and down my spine when I saw the proposed change to Tennessee’s malpractice law.

In Maryland there is legislation called the Good Samaritan Act and the Fire and Rescue Company Act, which essentially provides in relevant part that in an emergency setting, only extraordinary or outrageous conduct by a person giving assistance or medical care in an emergency, or by a member of a fire company or rescue company, can be termed “gross negligence.”  For the lawyers among you, see, e.g. McCoy v Hatmaker, 763 A2d 1233 (2000).

In the District of Columbia, one case that gives multiple but somewhat common definitions for  ‘gross negligence is D.C. v Walker, 689 A2d 40 (D.C. 1997):

[Gross negligence is] [t]he failure to exercise even slight care,” and “such negligence as would shock fair-minded men.”Shea v. Fridley, 123 A.2d 358, 363 (D.C.1956).  Similarly, the United States Court of Appeals for this circuit has stated that “gross negligence implies an ‘extreme departure from the ordinary standard of care.’ ” Wager v. Pro, 195 U.S.App. D.C. 423, 428, 603 F.2d 1005, 1010 (1979).  We have applied Maryland law to define gross negligence in the driving context as “a wanton or reckless disregard for human life or for the rights of others,” and “indifference to the consequences … [which] implies malice and evil intention.” Hall v. Hague, 257 A.2d 221, 223 (D.C.1969).  * * * And our federal court of appeals, applying what it apparently perceived to be District law, has said that, “[t]o constitute willful or wanton negligence, the police actions must involve ‘such reckless disregard of security and right as to imply bad faith.’ ”      

And just what is the alleged justification for this ‘gross negligence’ in ER’s standard being proposed?  Well here you go:

“In my personal practice, if I knew that I couldn’t be sued except for things that I truly believe I should get sued over, I could eliminate half of my lab tests, two-thirds of my X-rays and 90 percent of my CT scans because all of those tests are done for my protection, not the patient’s,” said Dr. Andy Walker, a local emergency physician and vice president of the Tennessee chapter of the American Academy of Emergency Medicine. “For TennCare patients, of course, the Tennessee taxpayer is paying for that.”

Yeah – that’s my emphasis added to the above quote.  Is this doctor kidding?  He does twice the number of labs, three times the number of x-rays and ninety percent of the CT scans he orders – to protect himself, not the patient?  And his litmus test for getting sued is what?  – “… things that I truly believe I should get sued over.”  Maybe when the Senate Committee is done investigating the ‘stents controversy’ at St. Joseph Medical Center in Maryland, they can take a look at what’s going on in Tennessee!

Using this wonderful test – “I should only get sued for what I believe is malpractice” – I am pretty confident that  there won’t be much medical malpractice litigation concerning ER care in the state of Tennessee should this wonderful piece of legislation go through.

Perhaps I should also make you aware that there is also pending in the legislature of this state a cap on non-economic damages.   If you are wondering at what amount they want such damages capped – it’s $1,000,000.  Apparently, however, the lobbyists for the medical profession really would like to see such damages capped at $300,000 since they believe such a low figure would “take away the profit motive of trial lawyers.”

I wonder if this double-pronged legislative initiative isn’t a variant on the old shell game.  Throw enough legislation out there and negotiate to get at least one of them passed.

Tell you what – I won’t be moving our firm to Tennessee any time soon.