Tort Reform – Consider the Consequences – Lesson #1

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

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.