29 January 2008

Another View Of Medical Malpractice Lawsuits

Rebutting the President's State of the Union Address statement about medical malpractice suits, a Plaintiff's personal injury lawyer argues that: "[T]he medical tort system works." The backup to that assertion is mostly here.

I'm not so sanguine about the state of the medical tort system, despite having represented Plaintiffs in medical malpractice cases myself, although the problem is not junk lawsuits. In my view, some of the biggest problems are that:

1. The vast majority of serious medical mistakes go uncompensated.

2. The transaction costs involved in litigating medical malpractice cases are immense relative to the fairly modest net compensation ultimately paid. The uncertainty and emotional toll these cases take on practioners and patients alike is also immense.

3. In cases with serious injuries that require ongoing treatment, the system often ill designed to place an accurate value on future medical expenses which are inherently hard to predict.

4. The system's exclusive focus on compensation does a poor job of removing bad doctors from practice. "From 1991 to 2005, only 5.9 percent of doctors were responsible for 57.8 percent of malpractice payments. Each of those doctors made at least two payments." Many of these doctors keep practicing medicine anyway, without even any disclosure of the risk to patients, because the professional grievance system that controls medical professional licensing is, like most such systems in all professions, frequently underfunded, lenient and toothless.

Of course, part of the concentration of claims is that risks are unequal by specialty (tracking largely the consequences of mistakes rather than the likelihood of mistakes) as reflected in premium rates for malpractice insurance (citations omitted):

[A] large insurer in Minnesota charged base premium rates of $3,803 for the specialty of internal medicine, $10,142 for general surgery, and $17,431 for OB/GYN in 2002 across the entire state.

In contrast, a large insurer in Florida charged base premium rates in Dade County of $56,153 for internal medicine, $174,268 for general surgery, and $201,376 for OB/GYN, and $34,556, $107,242, and $123,924, respectively, for these same specialties in Palm Beach County. In addition to the wide range in premium rates charged, the extent to which premiums increase over time also varies by specialty and geographic area. Beginning in the late 1990s, malpractice premiums began to increase at a rapid rate for most, but not all, physicians in some states. For example, between 1999 and 2002, the Minnesota insurer increased its base premium rates by about 2 percent for each of the three specialties, in contrast to the Florida insurer that increased its base premium rates by about 98, 75, and 43 percent, respectively, for the three specialties in Dade County.

Colorado's medical malpractice insurance premiums for obstericians and gynecologists, a high risk specialty, was on the order of $30,000 per year in 2002 and was stable in price over previous decade, as of 2007, that premium was a little over $50,000 a year, and the average premium for physicians in the state is on the order of a third to a quarter of that rate.

Medical malpractice insurance in the state is nearly a non-profit monopoly. "COPIC Insurance Company - which covers more than 80 percent of privately insured Colorado physicians" insures over 6000 physicians in the state. The COPIC, which is owned by a trust established by the Colorado Medical Society and strives to provide refunds similar to a cooperative or mutual company, had about 35% market share in 1986, gained about 20% market share in 1986-1987 in the face of rate hikes by competitors, and moved to its current dominant position in 2001 when St. Paul Companies withdrew from the market.

5. The corporate practice of medicine doctrine often operates here, like the intentional violation requirement in civil rights cases, to insulate the party in the best position to implement systemic reforms from liability, blunting the incentives to make these kinds of reforms. There is strong circumstantial evidence that the most important sources of medical mistakes are bad systems in complex practices, but the medical tort system forces doctors and medical mistake victims alike to pin blame on the negligence of particular individual practioners. Only anesthesiologists, of all the medical specialties, had made a serious collective effort to improve quality control in a systematic way. The other big advances in systems that reduce medical mistakes have been made by large medical enterprises in which physicians are employees rather than independent contractors or owner-operators, like Kaiser, Mayo Clinic and the Veteran's Adminstration, or by practice groups within medical enterprises like select trauma centers.

What did the anesthesiologists do?

In 1985, the American Society of Anesthesiologists launched APSF as a stand-alone organization devoted to patient safety through safety research and improvement. Markedly different from other medical organizations, the foundation allows not only anesthesiologists, but also nurses, insurers, and companies that develop products for the specialty to be members.

"Leaders in the medical specialty need to accept and endorse patient safety initiatives that are relevant to their specialty," Stoelting advises. "Opportunities to include industry as a partner for patient safety need to be sought and nourished. Funds to support safety research need to become available from medical specialties and corporate partners."

Because of the strategies implemented by APSF, patient deaths due to anesthesia have declined from 1 per 5,000 cases to 1 per 200,000 to 300,000 cases, according to studies compiled by the Institute of Medicine. As the death rate declined, so did the claims rate. Thirty-five years ago, nearly 8 percent of all medical malpractice claims were filed against anesthesiologists. From 1985 to 2001, claims dropped to 3.8 percent.

6. Rightly or wrongly, neither Plaintiffs nor Defendants perceive the system to be fair much of the time.

I'll save solutions for another day.

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