Smarr: Senate Should Fix Self-Gutting Malpractice Provision

Submitted by Hal Williams, Broker at The Keane Insurance Group

WASHINGTON BUREAU — A proposed addition to H.R. 3590, the Senate health bill, would encourage states to set up new systems for handling medical malpractice claims – but it also would let claimants opt out of using the new systems.

Lawrence Smarr, president of the Physician Insurers Association of America, Rockville, Md., says his group believes the provision would let claimants opt out at any time.

“Allowing claimants to opt-out of the new processes at any time is a serious concern,” Smarr says. “We are okay with an op-out provision as long as there is a point where both parties commit to the process… As currently worded, the provision would gut any tort reform the bill encourages states to implement. We are hopeful that it can be reworded during the conference process.”

The provision, contained in Section 10607 of the proposed H.R. 3590 manager’s amendment that was unveiled Saturday by Senate Majority Leader Harry Reid, D-Nev., would encourage states to develop, implement, and evaluate “alternatives to current tort litigation for resolving disputes over injuries allegedly caused by health care providers or health care organizations.”

The provision would provide $50 million in state health injury dispute resolution alternative grants per year for 5 years. Continue Reading via National Underwriter

Trial lawyers buy Democrats in Congress

Neither of the Obamacare proposals now before Congress includes a medical malpractice reform provision despite the fact that the public wants one — and that it would cut annual health care costs by $200 billion. A medical malpractice reform provision would protect doctors from expensive lawsuits filed by avaricious class-action plaintiffs’ attorneys who have driven malpractice insurance rates into the stratosphere. Judging by Federal Election Commission data on the political contributions of people associated with the top 15 class-action plaintiffs’ law firms, it’s no accident that malpractice reform is not part of health care “reform”: Trial lawyers are investing heavily in their Democratic friends who control the White House and both chambers of Congress.

Since Jan. 3, 2009, 581 contributions worth $1,261,023 have been made by donors identifying themselves as employees of the 15 firms (contributions by employees who did not identify their employer are not reflected in this data). Democratic candidates and committees received $1,241,978, or 98 percent of the total. The most generous of these lucrative sources of Democratic campaign cash was the Dallas-based Baron & Budd, best known for the late Fred Baron, who was finance chairman for former Sen. John Edwards’ 2008 presidential run. Thus far in 2009, Baron & Budd employees have contributed $212,958 to 21 Democrats, and not a cent to Republicans. Second on the list is the New York-based Grant Eisenhofer firm, with employees contributing $184,078 to seven Democrats and no Republicans. Of the 138 total recipients from employees of all 15 of the firms, 122 were Democrats and just 16 were Republicans. The Democrats received contributions averaging more than $4,700, while the GOPers averaged $646. Continue Reading via Washington Examiner

Lawsuit against hospital dismissed

Dec. 18–BANGOR, Maine — A lawsuit filed by Robert Olszewski, of Dover-Foxcroft, who claimed he was attacked in August 2007 by a physician assistant in Mayo Regional Hospital’s emergency room, has been dismissed by agreement of all the parties involved.

U.S. District Magistrate Judge Margaret Kravchuk had recommended earlier that because of Olszewski’s failure to obey court orders and his failure to prosecute his case, the lawsuit against Mayo Regional Hospital and others filed in federal court be dismissed.

The Dover-Foxcroft hospital, Hospital Administrative District 4, Chief Executive Officer Ralph Gabarro and physician assistant D. Scott Simpson were named in the lawsuit filed by Olszewski, who sought unspecified monetary damages. Simpson is no longer employed by the hospital.

“Mayo has been vindicated by this dismissal,” Tom Lizotte, Mayo Regional Hospital’s spokesman, said Thursday. “The hospital has always contended that this lawsuit was without merit.”

Olszewski claimed he went to the hospital’s emergency room twice within 17 hours on Aug. 6, 2007, for pain in his chest, headache and fever and was not given appropriate medical screening. He later went to a Bangor hospital, where he was admitted for a mild heart attack.

Before he left Mayo Regional Hospital, Olszewski criticized Simpson and the hospital for what he felt was inadequate and poor care. When he did so, according to the lawsuit, Simpson “rounded one of the counters, ran toward Olszewski and dove at his legs.” Continue Reading via Bangor Daily News

Lawsuit shaping up as test of Miss. tort reform

Submitted by Hal Williams, Broker at The Keane Insurance Group

JACKSON, Miss. — Before Mississippi lawmakers passed tort reform that limited damages in civil litigation, Ronnie Lee Lymas’ lawsuit against the store where he was shot wouldn’t have gotten much attention.

That’s anything but true now: The case is being characterized as a test of Mississippi’s tort reform laws — hailed by business leaders and despised by plaintiffs attorneys — and a showdown over so-called premises liability issues.

Lymas’ lawsuit is now before the Mississippi Supreme Court, and those filing briefs in the case include the Mississippi attorney general’s office, Gov. Haley Barbour and dozens of trade and business associations.

Barbour, a Republican who has championed tort reform, said in a news release Friday that Mississippi was a “judicial hellhole” before limits were placed in civil litigation and a ruling that overrides those laws would be devastating for the state.

Barbour filed a brief in the case Thursday asking the state Supreme Court to uphold a lower court’s ruling that he said affirmed “the constitutionality of Mississippi’s non-economic damage caps.”

The non-economic caps put a limit on what juries can award someone for such things as pain and suffering.

Numerous business groups have also signed onto court briefs, weighing in on the issue of premises liability and whether businesses are liable for injuries to customers. Continue Reading via Associated Press

Tort reform is the key to a healthier New Jersey

As the national debate on health-care reform and tort reform unfolds, it is worth noting that here in New Jersey, we have our own health- care crisis under way. And it is driving out physicians, limiting patient access to care and increasing the cost of health care for all of us.

Recently, I spoke to a young man who is studying medicine at the University of Medicine and Dentistry of New Jersey (UMDNJ). A lifelong New Jersey resident who excelled as an undergraduate, he represents the best and brightest our state has to offer. With grand aspirations of becoming a doctor, he enrolled at UMDNJ, hoping to someday practice in his home state. Unfortunately, he has come to realize that his dream of practicing specialized medicine faces a significant hurdle — and it’s not just rotations.

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This promising young medical student, whom I will call Jim, has become a casualty of our litigious health-care system. Growing up in a large family fostered Jim’s interest in delivering babies, prompting him to study obstetrics. Earlier this year, however, reality hit: Jim has the talent to become an OBGYN, but lacks the bottom line.

“I can’t afford it,” Jim realized. “I went to medical school thinking that if I worked hard enough, I would be able to practice my specialty of choice. Not being able to become an OBGYN because I can’t afford malpractice insurance was the furthest thing from my mind.” Continue Reading via NJ.com

Medical Malpractice and Health Care Costs: A New Study

Submitted by Hal Williams, Broker at The Keane Insurance Group

Most politicians in Washington agree that the health care system in this country needs to be reformed. Their ideas of what needs to be done are quite different, however. I spend most of my time praising the left for its ideas. Today, I’m going to take a closer look at one of the major issues on the right: The need to reform the medical malpractice system. I’ve talked about this issue before once or twice, but this time around I’ll be making use of a recently published paper on the issue written by Dr. Brandon Roberts and Dr. Irving Hoch, which appears in the December 2009 issue of Health Economics (subscription required).

The basic idea from proponents of tort reform is that malpractice drives up costs both because physicians are forced to pay large sums–which increase with the size of jury awards–for malpractice insurance premiums and because physicians pull out all the stops in their diagnosis and treatment of patients in hopes of staving off a lawsuit–a practice aptly labeled “defensive medicine.” Limit the size of jury awards and malpractice premiums will fall. Create no-fault remedies for physicians and patients and the practice of defensive medicine will taper off. As a result, health care costs will grow at a much slower rate. That’s the argument anyway.

The real question, however, is how much potential savings are represented by medical malpractice? In a fancy econometric analysis, Drs. Roberts and Hoch examine the association between the number of malpractice cases per capita and the per enrollee Medicare Part B (physician visit) expenditures across a nationally-representative sample of metro and non-metro areas. Controlling for a variety of demographic characteristics, medical services, differences in state tort law, and general times–as well as site-level fixed effects (if you don’t know what those are, ask me later)–they conclude that medical malpractice accounts for between 2 and 10% of national health care expenditures. Prior studies placed this figure between 1 and 2%. So what gives? Continue Reading via Huffington Post

Forgoing malpractice insurance is not the best solution

Submitted by Hal Williams, Broker at The Keane Insurance Group

When you combine high malpractice insurance rates with the increasing overhead of running an office, it may sound like a good idea to “go bare”—that is, carry no malpractice insurance. This is being done quite often in a few states, especially in Florida, where it is estimated that about 3,000 physicians don’t carry malpractice insurance. It seems to be well accepted by most patients.

The decision to go bare is predicated on the ability to keep all assets sheltered from a possible malpractice judgment. It used to be done by putting all assets in the spouse’s name, but the high divorce rate makes that a risky proposition.

One very effective method is advocated by Stuart Schulman, PhD, chief executive officer of IAVG–Physicians Global LLC. His plan is to create a retirement benefit (non-qualified plan) and place a lien on accounts receivable to make them judgment-proof. This essentially has eliminated judgments against any of his clients.

Although carrying insurance is not a requirement of having a medical license, many hospitals and insurance companies require proof of insurance from physicians before they care for patients, and such proof often is required to participate in clinical research studies.

Other physicians may hesitate to refer patients if they know that you don’t carry insurance. A certain number of patients will not go to a physician without insurance.

On the other hand, when prospective, potentially litigious patients see the required notification sign in your reception area saying that you don’t carry insurance, it is not unusual for them to leave before being seen. This action is seen as a plus by physicians who believe that the sign keeps such patients away from the practice. Continue Reading via Modern Medicine

Doctors Seek Aid From Business Schools

When Christopher Barton recently took over as chief of emergency medicine at San Francisco General hospital, he became responsible for balance sheets, income statements, and a sprawling staff — all with no formal business training under his belt.

The emergency room’s patient load had also begun to swell — up nearly 20% in the past year, according to Dr. Barton, adding to his management headaches.

So Dr. Barton decided to get some business school training, a move many physicians are making to cope with the ever-changing pace of modern day health care. Nurses, private practice managers and hospital administrators are also seeking guidance on how to analyze the slew of data now accessible to them, with the hope of improving the quality of care and lowering costs.

Schools are responding with business management programs geared toward the medical community.

Dr. Barton is one of 68 students enrolled in Harvard Business School’s Managing Health Care Delivery, a $22,000 non-degree program that launched in October and consists of three one-week courses spread out over nine months. The program is designed to get participants thinking critically about ways to improve day-to-day processes.

“Leaders in medicine and health care have not taken the management side as seriously as they should,” says Dr. Barton. Continue Reading via Wall Street Journal

Udall files malpractice amendment to health-reform bill

Submitted by Hal Williams, Broker at The Keane Insurance Group

U.S. Sen. Mark Udall on Thursday filed an amendment to the Senate’s health care reform bill intended to reduce the cost and complexity of medical malpractice lawsuits, which many consider a factor in the rising cost of health care.

The Colorado Democrat’s amendment, which is supported by the Institute for the Advancement of the American Legal System at the University of Denver, would establish federal grants for pilot programs administered by nonprofit organizations to streamline the legal process in medical malpractice cases.

Udall said the proposal would “create laboratories of reform all over the U.S.” The amendment would change the rules regarding the use of expert witnesses in medical malpractice trials to expedite the process.

While he did not provide statistics on how much money could be saved by implementing the programs, Udall said that “significant savings” could be realized through such pilot projects. But the savings would depend on how states tweak their legal system.

Rebecca Love Kourlis, executive director of the legal institute, noted the state of Oregon doesn’t allow “discovery” on expert witnesses — a pre-trial litigation process during which each party requests relevant information and documents from the other side. Continue Reading via Denver Business Journal

My Turn: Tort reform would cut insurance cost

This October, the nonpartisan Congressional Budget Office released a report indicating that lowering the cost of medical malpractice tends to reduce the use of health care services. The CBO estimates that implementing a typical package of tort reform proposals nationwide would reduce total U.S. health care spending by about 0.5 percent, or $11 billion, in 2009, and these proposals would reduce federal budget deficits by roughly $54 billion over the next 10 years. As the late Sen. Everett Dirksen said, “a billion here, a billion there, and pretty soon you’re talking about real money.”

CBO’s research also indicates that tort reform could affect costs for health care both directly and indirectly: directly, by lowering premiums for medical liability insurance; and indirectly, by reducing the use of diagnostic tests and other health care services when physicians recommend those services principally to reduce their potential exposure to lawsuits. A survey of Vermont physicians found that concerns about potential lawsuits affected certain types of decisions physicians made, including ordering tests, imaging and lab work, and referring patients to specialists. Almost every physician will point to the need to address defensive medicine as a way to help control health care costs.

In 2005, the state Department of Insurance issued a report on “Medical Malpractice Liability Insurance in Vermont.” The report indicates that Vermont spent $25 million on medical malpractice costs, and medical liability insurance rates for OB/GYNs in Vermont represented between 19 and 30 percent of their wages. Continue Reading via BurlingtonFreePress.com