New research published in the latest issue of Journal of Empirical Legal Studies examines Texas medical malpractice claims and finds no tort crisis. Instead, the study’s authors find that, over a 15 year period, the system was largely stable and generated few significant changes in claim frequencies, payments, or jury verdicts. “Average payments on medical malpractice claims rose because small claims were squeezed out of the system over time, not because payments on larger claims increased,” the authors explain. The authors used a comprehensive database of insured closed claims maintained by the Texas Department of Insurance since 1988. The data presented a picture of stability in most respects and only moderate change in others. Their research also revealed a weak connection between claims-related costs and short-to-medium fluctuations in insurance premiums. “Our hope is that better understanding of the claims process will lead to reforms that address real shortcomings in the malpractice litigation and claims payment systems, rather than respond to anecdotes or the rhetoric of crisis” the authors Bernard Black, Charles Silver, David A. Hyman and William M. Sage conclude. From 2000 to 2004, the increase in premiums collected by the leading 15 medical malpractice insurance companies was 21 times the increase in the claims they paid, according to the study.

Few people would disagree that the current state-specific medical liability systems throughout the United States are slated for significant changes to address what many have termed the “medical malpractice crisis.” (1) Although there seems to be consensus regarding the breadth of the so-called crisis and the need for successful reform, there is little agreement regarding which methods of change will result in the most effective strategy for medical malpractice reform. The fact that more than 400 legislative bills on this topic were filed in 48 states in 2005 is indicative of the diverse, and oftentimes contentious, solutions to reform. (2)

The numerous solutions suggested by state legislators illustrate that medical malpractice reform is a multidimensional issue that cannot be resolved with one distinct strategy. Legislators must take a number of factors into consideration when proposing medical malpractice reform strategies, making the task both complex and controversial. Among the many elements that factor into the reform strategies are economics (eg, rising health care costs, increased medical malpractice insurance premiums, jury awards in malpractice lawsuits); patient rights (eg, access to quality health care, compensation for negligent medical acts); regulatory aspects (eg, of physicians, the insurance industry, attorneys); and the affect of the proposed law on existing laws both at the state and federal levels.

CURRENT MEDICAL MALPRACTICE LAWS
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This article explores some of the reform strategies that state governments have adopted, including the elements of the medical malpractice system the state legislatures intended to change. It also provides a brief discussion regarding the states in which medical malpractice reform initiatives are anticipated to continue during the 2006 state legislative session. Overall, this article explores the extreme complexity and political polarization that state legislators face in attempting to successfully achieve medical malpractice liability reform.

Damage caps. One of the common approaches to medical malpractice reform adopted by states is to implement damage caps. Damage caps limit the amount of money a patient can receive as compensation for injury(ies) suffered as a result of an alleged negligent medical act. Approximately 32 states have laws that cap specific types of compensatory damage awards in medical malpractice cases. (3) Many of these laws restrict the amount of money that a patient can receive for noneconomic damages or what is often referred to as “pain and suffering.” (4)

For example, Alaska, California, Idaho, Kansas, Montana, Ohio, Texas, and West Virginia laws prohibit a patient from receiving more than $250,000 for noneconomic damages. (3) One rationale behind noneconomic damage caps is that because such damages are extremely difficult to quantify, a jury often will inflate the award to the injured patient. In turn, such awards are believed to increase the costs associated with medical malpractice insurance (eg, increased medical insurance premiums that then create increased health care costs). (4)

Other states, including Colorado, Indiana, Louisiana, Nebraska, New Mexico, and Virginia, have laws that apply in all injury-related cases, medical liability Included, that cap the monetary amount that an injured patient can receive for all damages, both economic (eg, lost wages) and noneconomic. (4) Further, a number of states have adopted laws that restrict the amount of and the conditions under which monetary damages are awarded to punish the health care provider for a “wanton disregard of [patient] safety” (ie, punitive damages). (3,5)

Although they are popular in the medical malpractice reform arena, damage caps are not without their critics. Opponents of damage caps, including attorneys and patient rights and safety organizations, contend that damage caps penalize the most seriously Injured patients while reducing health care providers’ accountability for negligent acts. (4)

Modifying the collateral source rule. A second approach to medical liability reform that a number of states adopt is modifying the collateral source rule. Intact, the collateral source rule prohibits defendants from introducing information at trial or during negotiation for the purpose of off setting the damages awarded by asserting that the plaintiff may have received compensation from another source (eg, worker’s compensation, another Insurer). (5)

Connecticut, Hawaii, Maryland, Missouri, North Carolina, Oklahoma, Oregon, Tennessee, and Vermont permit consideration of collateral source payments received by the patient when damages are awarded in medical malpractice cases. (6) Proponents of this type of reform argue that “[w]hen a plaintiff receives compensation from their insurance company and again at trial, the Insurance proceeds do not represent actual compensation for an Individual’s injuries, but rather a source of windfall.” (7)

Recent lawsuits against HMOs are challenging decisions based on corporate policies. In Detroit, Michigan, Blue Care Network settled a lawsuit based on negligent corporate policies. According to the lawsuit, 12-year-old Kimmietta Branch suffered permanent brain damage after being denied medical treatment by a Blue Care Network pediatrician because of an outstanding $40 bill. She died four years later. Although Kimmietta Branch’s mother, Cassandra Branch, offered to pay the bill, she was told she could not pay and could not see a physician. Two days later the child became disoriented and was admitted to a hospital, where she was diagnosed with viral encephalitis. According to the lawsuit, Blue Care Network had a bad-debt policy that prohibited patients from seeing a physician if there was an outstanding bill.

In another case, the parents of a two-day-old girl who died a day after she went home in 1995 are suing Aetna U.S. Healthcare, Blue Bell, Pennsylvania, for damages caused by the insurer’s former policy of discharging newborns from hospitals after 24 hours. The, previous testimony of the parents, Steve and Michelle Bauman, to Congress and the New Jersey legislature led to a Federal law and many state laws requiring a minimum 48-hour stay for newborns and their mothers. The U.S. Supreme Court set a precedent in June 2000 when it upheld a Federal appeals court ruling that the couple could sue the HMO for malpractice in state court. A lawsuit has been filed, and the trial is expected to take place next summer.

Previously, state malpractice lawsuits against HMOs were moved to Federal courts, where plaintiffs could recover only the cost of care denied them. Now HMOs face pending Federal class-action lawsuits challenging how HMOs manage care and potential Federal and state laws giving patients the right to sue their HMOs.

IN 1787, 11 YEARS after penning the Declaration of Independence, Thomas Jefferson wrote, “without health there is no happiness. An attention to health, then, should take the place of every other object.” (1)

Jefferson’s words ring even more true today. As a society, Americans attend to health in ever increasing amounts. Health care spending accounts for nearly 15 percent of the U.S. gross domestic product.

Multiple factors account for this:

* Technological innovation

* Physician-induced demand

* Insurance-generated consumer price insensitivity

* Governmental regulation

Some maintain that the fear of medical malpractice litigation plays a significant role as well. This fear of liability, also called defensive medicine, is defined as “objective measures taken to document clinical judgment in case there is a lawsuit.” (2)

Indirect costs to the health care system secondary to defensive medicine are estimated to run $15 billion to $35 billion per year. (2,3)

Many researchers and policy analysts, like Wennberg and Eddy, (4,5) recommend analyzing physician practice patterns and small area variations in practice to promote cost-effective, high quality clinical policies. They advocate development of clinical practice guidelines to assist and standardize practitioner treatment of particular medical conditions.

As the movement toward guidelines gains momentum, questions arise about the role guidelines will play in medical malpractice litigation. How will they affect the current status of a malpractice tort? What will the implications for public policy be?

What are clinical practice guidelines?

Clinical practice guidelines - also known as practice parameters, clinical protocols, critical pathways and treatment algorithms - serve five major purposes in medicine, according to the Institute of Medicine.

1. Assist patients and practitioners in clinical decision-making

2. Educate individuals or groups

3. Assess and ensure quality of care

4. Allocate health care resources

5. Reduce the risk of legal liability for negligent care (6)

The very explicit guideline development that emerged in the 1990s weighs potential benefits, harms and costs of treatment for each individual treatment option with the patient preferences for outcomes. (7)

WITH HEADLINES proclaiming another medical malpractice crisis, it’s a good idea to take stock of how physicians conduct business with patients.

Let’s face it, in malpractice cases the trouble doesn’t begin with lawyers, it begins with doctors’ interactions with patients. Patients who feel well cared for and have an amicable relationship with their physicians rarely sue, even when there may be a poor outcome to some element of a care plan.

In medical practice for 38 years, I’ve seen the malpractice concerns of physicians rise from minimal to, sometimes, almost hysterical. The scope of our problems accelerated in the early 1970s.

I believe our risks for litigation grew as individuals dispersed away from their core family groups after World War II. The close, long-term contacts with which many of us grew up in our well-defined communities were disrupted. Trust became a victim of that dispersion. People did not have the family ties and, due to frequent moves, did not develop new ones.

That mobile pattern continues to increase today. In addition, the highly publicized scientific developments in medicine began to make the public believe that medicine could cure almost anything and expectations became unrealistic in many cases.

This combination of lost trust in physicians and publicity surrounding miracle cures played a large part in the development of the litigious society in which we live. Of course, this litigious attitude is not limited to physicians, but it hits us hard when we see our insurance premiums rise each year and our coverages reduced.

Cost of doing business

Involved in medical malpractice crisis since the early 1970s with the Nebraska Medical Association committee on malpractice, I later served as a co-author in a group that helped write the Nebraska medical malpractice statute that still exists today.

In the mid-1980s while a professor of family medicine at the University of Cincinnati, I took a sabbatical at the University of Cincinnati College of Law as a scholar in residence to study the basic elements of tort law and how they affect the medical profession. That sojourn led to continued activity in the area of malpractice for the past 16 years.

Worried about breast cancer, AIDS or fatal traffic accidents? Maybe you should be more concerned about your medical treatment.

A new study has reported that one in every five hospital patients experienced adverse events–due to inadequate follow-up medical care–after leaving the hospital and returning home.

In fact, medical errors in the United States account for more deaths than breast cancer, AIDS or highway accidents combined.

Prescription drugs accounted for the most problems after discharge, affecting 66 percent of the 400 patients involved in the study.

Antibiotics were responsible for 38 percent of the problems, corticosteroids (used in hormone replacement therapy) for 16 percent, cardiovascular drugs for 16 percent and pain relievers for 10 percent. Three percent of patients suffered permanent disabilities.

If doctors performed more thorough examinations of patients while the patients were still in the hospital, monitored their patients more closely after their release, and informed them of possible drug side effects and interactions, many of these post-discharge problems could be avoided, said the researchers.

Results of the study were published in the February 4, 2003 issue of the Annals of Internal Medicine.

Medical malpractice premiums are rising, and angst and recriminations abound. The insurance industry claims premium hikes are largely due to an increase in lawsuits by injured patients. The American Trial Lawyers Association claims the insurance industry is to blame for premium increases, arguing that insurers often present suspect data in support of their actions. State lawmakers are being challenged to weigh opposing arguments and find a way to equitably reform the regulation of medical malpractice insurance coverage and claims adjudication

Meanwhile, the American Medical Association cites a dozen states–Florida, Georgia, Mississippi, Nevada, New Jersey, New York, Ohio, Oregon, Pennsylvania, Texas, Washington, and West Virginia–as experiencing a full-blown crisis because of rising medical malpractice insurance premiums, and predicts that 30 other states soon will be under a similar crisis.

How are state officials and legislators addressing this challenge to avoid loss of critical services and protect the rights of patients? Here are a few examples.

Florida. In November 2002, the Florida House appointed a work group to study the issue of rapidly rising medical liability insurance premiums. The work group is continuing research on medical liability performed by another House-appointed work group.

Mississippi. Mississippi House Bill 2 (HB 2), enacted in 2002, limits noneconomic damages to $500,000 for actions filed on or after the bill’s passage but before July 1, 2011; actions filed between July 1, 2011, and July 1, 2017, are limited to $750,000; and actions filed after July 1, 2017, are limited to $1 million.

Willie Shoemaker (1993): The former jockey filed a $50 million lawsuit against Glendora Community Hospital and the seven doctors who treated him after he drove his Ford Bronco oft a 30-foot embankment. The accident rendered him a paraplegic. His suit against the California Highway Department for not having a guardrail was ultimately dropped. In 1997, he settled with Ford Motor Co. for $2.5 million and negotiated a confidential settlement with the doctors and the hospital.

Hank Gathers (1990): The family of the Loyola Marymount University basketball star sued the school’s coach, trainer and athletic director, seven doctors and three medical practices after Gathers collapsed on court and later died from a heart disorder. Eleven defendants settled, including Gathers’ cardiologist, for $1 million. Loyola’s insurance carrier settled for $1.4 million. The case was ultimately dismissed against Kerlan-Jobe Southern California’s recent history. Orthopedic Group of Inglewood and two doctors who treated Gathers that night.

Ashley Hughes (1987): The family of newborn Hughes sued the doctor at Pomona Valley Community Hospital who twisted her spinal cord with forceps during her delivery, rendering her a quadriplegic. The hospital settled early in the case. In 1991, a Los Angeles jury awarded Hughes’ family $21 million, or $460 million paid over her lifetime, the largest malpractice award in California at the time.

Harry Jordan (1982): The owner of an insurance agency was awarded $5.2 million three years after doctors removed his healthy left kidney instead of his cancerous right one. He and his wife sued six doctors, two medical groups and Long Beach Community Hospital, where the surgery occurred. The jury verdict was awarded against four of the doctors and Grobert-Sawyer Medical Corp.

L.A. County faced a $12 million verdict in a medical malpractice case involving the county-owned Harbor-UCLA Medical Center in Torrance when, on the first day of trial, its lawyers walked out of the courtroom.

They asked the judge to change the trial date because they had another case going on at the same time. The judge refused, and the county lost.

That refusal to budge, said Robert Harrison, president of the Association of Southern California Defense Counsel, illustrates the concerns that judges have become too inflexible in complying with a state-enacted fast-track system, designed to move cases through the courts more swiftly.

This week, the Judicial Council of California plans to review a 46-page report that, if approved, would change the fast-track system by giving lawyers more time to try cases.

“The problem with it is it treats every case the same,” Harrison said. “Cases have been set in a cookie-cutter fashion based on a formula that was not appropriate. While fast-track is a great program, and one we need to maintain, it needs to be fine-tuned.”

Many judges, however, fear that the changes may increase the time and cost of civil lawsuits.

“If you’re a major business, you have to pay lawyers’ fees for years and years because the case takes that long,” said L.A. Superior Court Assistant Supervising Judge Stephen Czuieger. “We’re getting most cases solved within a few years. That’s more economical.”

‘Timely resolution’

Changes to the fast-track system could assist civil cases needing more research and time, such as product liability, construction defect, medical malpractice and employment discrimination. The system does not apply to criminal or complex civil cases, such as some class actions.

The fast-track system, which applies only to the Superior Courts of California, is designed to reduce the life of court cases.

“The whole idea is to assist parties in the timely resolution of their disputes,” said L.A. Superior Court Assistant Presiding Judge William MacLaughlin. “It was common 10 years ago for cases to be four or five years old before they could get to a trial date. Now, in Superior Court, it’s quite common a case can get a trial date in less than a year after it was filed.”

The Robert Graham Center: Policy Studies in Family Medicine and Primary Care in Washington, D.C., studied malpractice claims based on medical errors made by primary care physicians. The study covered 5,921 claims involving medical negligence that occurred between 1985 and 2000 in the United States and the United Kingdom. Of those claims, 68 percent involved negligent events in outpatient settings and resulted in more than 1,200 deaths. The most prominent medical conditions associated with negligent, adverse events were acute myocardial infarction, lung cancer, breast cancer, and colon cancer. The study, “Learning from Malpractice Claims About Negligent, Adverse Events in Primary Care in the United States,” was published in the April edition of Quality and Safety in Health Care.