In the classic old board game Operation, it takes a steady hand to extract that "wrenched" ankle with a pair of tweezers. But in real life, there are horrifying stories of doctors leaving clamps and sponges inside patients after an operation, causing medical problems or death. In the game, failure results in a buzzer and light going off; in the real world, such mistakes -- along with others -- can result in lawsuits that some say are crippling the American health care system.
With doctors paying insurance premiums to protect themselves and their hospitals against such lawsuits -- premiums that can reach into the hundreds of thousands of dollars per year -- many health care advocates are calling it a crisis. The answer? Limit the amount juries can award victims of malpractice, as states like Idaho have recently done.
But patients' rights advocates and trial lawyers are asking if that's fair to patients who lose their bodily functions -- or their lives. They also argue that such caps may not lower the premiums, because they say the insurance industry is trying to climb out of bad investments and a weak economy on the backs of doctors.
The issue that has festered for years is now on the front burner of public policy, as in both Olympia and Washington, D.C., tort reform bills seeking to cap doctors' liability are making their way through the legislative system.
Docs on the Run -- Sticker shock has become an occupational hazard for many doctors. Depending on which state they work in and what field of medicine they practice, doctors' malpractice insurance has skyrocketed.
"In order to practice you have to prove you have malpractice insurance," says Linda Partoll, a physician practicing gynecology and urology at Northwest Gynecology Clinic in Spokane. "It's just like car insurance, so you can pay for different levels of coverage. With the rates of insurance premiums, we all have the minimum [insurance coverage] we can have."
For Partoll, the minimum is less than it would be if she still delivered babies, a part of her practice she stopped about five years ago, although not because of her premiums, she says.
"I pay almost $40,000 a year, and my partners are at almost $60,000 a year," Partoll says. "There is a $20,000 difference between delivering babies for the same amount of coverage."
Kalen Privatsky, office administrator at Spokane's Inland Neurosurgery and Spine Associates clinic, says neurosurgeons pay anywhere from $70,000 to $120,000 a year for malpractice insurance.
John Gollhofer, a practicing obstetrician with Rockwood Clinic in Spokane, agrees that premiums are just too expensive; he says Washington needs to see a cap on jury awards to prevent doctors from leaving the state or limiting their practices -- something that has been plaguing other states like West Virginia.
"Rockwood's insurance was doubled this May from $1.4 million to $2.8 million," Gollhofer says. That's $2.8 million to cover about 120 doctors in malpractice insurance for one year. And that's not the worst of it. "Older physicians -- ones on the cusp of retirement -- if they see their premiums going up $40,000, $60,000, $100,000, they'll retire instead. There's no way they can pay that. And we're undoubtedly going to see practitioners stop delivering babies. [The remaining doctors] will get a whole lot busier. So, they'll be busier or stop delivering altogether. It's ultimately bad for the patients."
Sally Yates, the associate general counsel for Group Health Cooperative in Washington, says capping juries is a reality people have to face.
"We fully support compensating people who have been harmed due to medical errors, but we have limited dollars out there. All of us value life, and who can put a price tag on some of these things? As a society, we have to come together to find boundaries."
Partoll adds that while the reality of high premiums is difficult for doctors, it's even harder on patients.
"A medical practice is a business like anything else," Partoll says. "So if you're losing money in one way, you have to come up with a way to make it up somewhere else. The only way we can do that is to choose patients with better insurance. That's what I do. That's what you're seeing in Spokane. You can limit or not see patients with poor paying insurance. In Spokane, that's Medicaid and Medicare, and, unfortunately, the military insurance, which is a disservice to their people. It was a really hard decision for us, because we have three ex-military guys [on staff], but we have to do something."
Other doctors are doing the same. The Rockwood Clinic no longer takes new Medicare patients.
"It's just against everything we we've ever been to medical school for," Partoll says. "I don't think everyone understands how hard a choice it is for us."
Because malpractice claims are so common, competent doctors have found themselves practicing defensive medicine. For example, doctors are ordering unnecessary tests and overdocumenting files in an effort to cover their tracks in case a claim is made. Gollhofer says his colleagues are doing this because "failure to diagnose" is the most common claim in malpractice suits.
"Defensive medicine significantly inflates the cost of medical care," says Gollhofer. "It's a waste, and it's done only so [the doctor] can say if he's asked by an attorney that he did do a specific test. It has nothing to do with overall health."
Doctors and insurance companies claim that Washington is in crisis and that they will soon be on the run to states like Idaho and California, which already have caps on juries and varying degrees of lowered malpractice insurance.
In the rural parts of Washington the impacts are already being felt. Family Medicine Spokane, a residency group headed by Dr. Gary Newkirk, received notice last week that as of June 30, 2003, their malpractice provider, Physician's Insurance, will no longer cover them. Family Medicine Spokane is a part of 13 residency programs in five western states; Physician's Insurance dumped all of them.
Family Medicine Spokane provides practice training for the specialty of family medicine. Three-fourths of the graduates go on to work in Washington's small rural towns. Newkirk says that each month the doctors training at the clinic deliver the babies of roughly 100 indigent women -- most of whom are on public assistance. If Newkirk can't secure malpractice insurance before the end of June, the clinic will close, leaving poor women in Spokane without care and rural areas without doctors.
Only a few doctors in Spokane have decided to close their doors, and most of them were on the verge of retirement anyway. But there are doctors who are limiting their practices. As Gollhofer says, some have stopped delivering babies; others are refusing to perform risky surgery.
"The big increases haven't come yet," Gollhofer says, adding that a huge increase is expected on January 1, 2004. When that comes, he predicts we'll see plenty of docs on the run.
"It Ain't Broke" -- "When you say 'Washington is in crisis,' our absolute and unequivocal position is that is unbelievably untrue," says John Allison, a Spokane attorney who works with plaintiffs in many medical malpractice cases. "The simple truth is malpractice lawsuits pale in comparison with losses [insurance companies have endured] in the stock market.
"The Wall Street Journal, one of the most conservative, pro-business papers, said insurance is blaming injured victims for [insurance companies'] own financial crisis -- for their poor investment choices and for 9/11," Allison says. "The U.S. Chamber of Commerce rated Washington state third best in the country when it comes to torts."
Allison says the judicial system works; it's set up to weed out frivolous lawsuits and allows for a jury of peers to hear evidence based on expert witnesses.
"We feel like it ain't broke, and there's nothing that needs to be fixed," he says. "We don't see an explosion of large jury verdicts. The legislature has enacted tough laws. You can't make a claim for $10 million because someone will just pay you to go away. That just doesn't happen. The courts require evidence."
Scott Jarvis, deputy commissioner of consumer protection with the Washington State Insurance Commissioner's office, is careful not to take sides on the issue but notes that he isn't impressed with some of the tort reform rhetoric.
"From an [insurance] availability standpoint, Washington is not a state in crisis," he says. "It's more expensive, but those are distinctly different issues. The number of claims has remained constant. The verdicts have gone up as a group, but in terms of excess I think there were only half a dozen that were in excess of $1 million."
Sue Evans, spokeswoman for the Washington Trial Lawyers Association, agrees: "There's an average of 438 medical malpractice lawsuits filed each year for the past 20 years. The average lawsuit payout is about $100,000, according to National Practitioner Databank, which is the national clearinghouse where all lawsuits get reported for doctors."
Hardly the "astronomical" numbers cited by insurance companies, Evans says. She reports that out of 11,059 medical malpractice lawsuits filed in King County over a specified period of time, a majority were settled before trial. Only 83 of those were thrown out of court by summary judgment -- when judges toss out lawsuits they see as frivolous. And out of all 11,059, only 45 went to court. Only 15 of those 45 were actually won by injured patients, Evans says, adding that her group didn't break out Spokane County numbers this way.
"Doctors always get the benefit of the doubt," Evans claims. "What they don't tell you is this: Doctors are the ones requesting jury trials. If you think jury verdicts are outrageous, why request jury trials?" Evans answers her own question. "Doctors win a majority of jury trials."
Evans says no one's out to get doctors: "It is true doctors are getting gouged, but it's not because they are getting sued out of business. There is just no evidence of that. That's just not happening. You get big verdicts now and then, but those are the exception, not the rule."
Allison agrees that trial lawyers are not out to bankrupt doctors or their insurance companies.
"Attorneys who represent victims of medical malpractice honestly feel sorry for the doctors in our community who see their premiums rising. We feel in many incidences they are being used by their own insurance companies."
"Unlimited Premiums" -- "There is a crisis in the medical profession; it permeates the entire country. There are a lot of frivolous lawsuits, and they really impact the costs to insurance carriers," says John Kurtz, an independent insurance claims consultant in Spokane.
Every year, practicing physicians face a 16 percent chance of having a malpractice claim filed against them. In high-risk specialties such as obstetrics, orthopedics, trauma surgery and neurosurgery, that figure jumps to 40 percent. The Doctors Company, a national medical liability insurance company, reports that as many as 70 percent of these claims are found to be without merit. Of the claims that make it to trial, their research shows that 80 percent are found in favor of the doctor.
Tom Myers, president and CEO of Physician's Insurance Company, the largest insurer of doctors in Washington state, which provides malpractice insurance to 75 percent of practicing doctors here, says jury awards that shell out millions of dollars are getting more common, and it's causing insurance companies to go bankrupt.
For example, Washington Casualty, which insured about three-quarters of the state's rural hospitals, and 17 percent of the state's doctors, was so near bankruptcy that it was taken over by our state's insurance commissioner. Also, St. Paul Insurance, the largest malpractice insurers in the nation, has stopped covering doctors for malpractice altogether, claiming millions of dollars in losses from jury awards and settlements.
Kurtz claims that insurance companies often pay to settle cases because it's cheaper than going to trial, not because the doctor is guilty.
"Here's what happens," he says. "Suppose that the damages are moderately severe. In other words, the patient got a bad result but the doctor apparently met the standards of care. The insurance company looks at the scenario: how much they'll pay in attorneys' fees, what chance they have in winning the case. If we know we're going to pay $150,000 in attorney fees, [we figure] let's get rid of the case for $100,000."
Claims consultant Kurtz says that the major group fighting tort reform is trial lawyers because they stand to make a lot of money in malpractice cases.
"They are everywhere," he says. "They just don't want [tort reform] to happen; it's killing the goose that laid the golden egg. I don't see any plaintiff attorneys losing sleep over our economy. They're going after everyone."
Richard Anderson, chairman of the Doctors Company, stated in a published article that, "In the past few years, there has been an explosion in the costs of individual claims." He says jury verdicts awarded to plaintiffs in excess of $100 million dollars have increased four-fold over a 10-year period.
None of these awards has been in Washington state, but tort reform advocates insist it's only a matter of time before juries start following suit, topping awards like the one in Texas, where a $268 million dollar verdict shook the insurance and medical professions. (Texas has since enacted jury award caps.) Everyone -- insurance companies, doctors, lawyers and consumer advocate groups -- agree that awards that high are all but unheard of, but tort reform advocates say we need laws in place to prevent verdicts like that one from happening again.
"Insurance is not magic," Anderson testified before Congress last summer. "If society expects insurers to pay unlimited awards, it should expect unlimited premiums. As premiums increase, so must the cost of health care. Since health care today is a zero-sum game, these cost increases mean corresponding decreases in access to health care."
As the experiences of Partoll and Gollhofer demonstrate, high insurance premiums have forced doctors to pick and choose to whom they will provide health care. People with little or no health care will suffer the most.
Though tort reform advocates make a compelling argument, they can't promise that their solutions will work. As physicians' insurance companies push for tort reform bills, they admit to not knowing whether capping juries will lower doctors' premiums.
Myers, president of Physician's Insurance, says the bills must not only be passed, but also challenged and upheld in court before premiums would ever go down.
"What we're asking for in this legislature was passed in 1986," Myers says, referring to a former tort reform law that was immediately found unconstitutional. "The stories I've heard are it did not reduce premiums because there was no specific knowledge that the [U.S.] Supreme Court would uphold them. And I think it's the same situation now. It would then have to be accompanied by a United States amendment, and until it's challenged in court and that process is completed, there is no assurance that there will be any rate drop in the premium."
Capping Malpractice -- To understand tort reform, you have to understand the difference between economic and non-economic damages.
"The difference between economic and non-economic damages," says Evans, the spokeswoman for the Washington Trial Lawyers Association, "is this: 'We're going to pay for the wheelchair, but not going to pay for the fact that you have to live in the wheelchair.' "
Economic damages cover the costs of an injured patient's loss of income during time of injury -- or afterward if injury is sustained -- and other economic changes the patient endures because of the injury. Non-economic damages are awarded for having to go through the injury in the first place.
Proponents of tort reform insist that jury award limits would only be on a plaintiff's non-economic damages, with no cap on economic damages. Still, citizens' groups believe that limiting Washington juries to $350,000 for non-economic damage is not only wrong, it's discriminatory. (The proposed federal legislation would reduce that cap to $250,000.)
"What you're saying is that people who make more are worth more because their economic damages are going to be more," says Evans. "For instance, 25-year-old Kristen Griffin went for gall bladder surgery. She was over-medicated, went into a coma and died. She didn't survive the negligence. She was right out of college and didn't have a job. She didn't have money. Most of her damages are non-economic. Under the [federal] bill, her life would be worth $250,000."
The elderly, children and poor people, who do not have large economic "worth," would suffer under tort reform, Evans says. In addition, she says, malpractice is a reality we have to face -- a reality doctors must be responsible for.
"The Harvard School of Public Health released a study showing that one out of every three doctors interviewed said they'd personally seen or knew of an incidence of malpractice in the past year that posed a serious risk to a patient," Evans says.
Public Citizen, a national nonprofit public interest organization, reports that the Institute of Medicine released information claiming 44,000 to 98,000 Americans die each year as a result of medical malpractice in hospitals alone. That is more than motor vehicle accidents (43,000), breast cancer (42,000) or AIDS (17,000). The report also claims that for every person who files a claim, there are seven injured patients who never come forward.
Public Citizen believes the focus should be on preventing medical malpractice instead of changing laws to help insurance companies that indemnify doctors found to be guilty in a court of law.
Jarvis, with the Washington Insurance Commissioner's office, agrees. He says we should be asking some different questions: "Do we have an effective monitoring system in our states to monitor claims against doctors? Has someone taken a look at our system of discipline?"
Public Citizen did. It rated each state based on how many practicing physicians it holds, how many claims were made, and, of those claims, how many disciplinary actions were initiated. For the past 10 years, Washington has rated among the 15 worst states for discipline. In effect, our state's medical boards aren't doing their jobs, says Public Citizen.
"Most doctors [who face discipline] are disciplined for pill-popping and sexual harassment, but not medical malpractice," Evans says. In fact, the Public Citizen chart shows that Washington state has about 16,000 practicing physicians and that of those, only 2.23 "serious disciplinary actions" were taken in 2002 per 1,000 doctors. That's lower than the national average, which is 3.56 per 1,000, and far lower than the state with the highest rate of disciplinary action in the country, Wyoming, at 11.87 per 1,000.
Public Citizen also claims that of all the malpractice suits filed, five percent of the doctors are responsible for 54 percent of the payouts. A small number of doctors, in other words, are committing a majority of the malpractice.
Some disagree with this part of Public Citizen's report, but there are doctors with long records of malpractice -- doctors who, tort reform opponents say, jack up the price for everyone's malpractice insurance.
As a case in point, consider Robert Lehman, a former obstetrician-gynecologist in Spokane. As reported in the Seattle Times, Lehman has paid at least five lawsuit settlements or judgments, has a pending malpractice lawsuit against him and has been investigated eight times by the Washington State Medical Quality Assurance Commission. Despite his record, the commission never took action against him.
While that disciplinary commission found no wrongdoing, stating that his actions were within the boundaries of the standards of care, Sacred Heart Medical Center barred Lehman from practicing at the hospital, though he was free to continue with other hospitals.
Lehman stopped practicing medicine in Spokane because, he has told other media, his malpractice insurance was too high. Lehman has been featured in the daily newspaper in Spokane as an advocate for tort reform. He also appeared in an advertisement sponsored by Washington State Medical Association promoting tort reform. The WSMA reported being "chagrined" to learn of Lehman's past problems with medical malpractice.
Everybody's Problem -- Health care is now Spokane's leading industry, and the local economy could be damaged if doctors are forced to move or close their practices. Patients, too, should be concerned, as quality of care could suffer.
But if juries are limited, people with severe injuries from malpractice and low economic "worth" will suffer, too. The push to eliminate malpractice in the first place could lose steam, as well, if awards are reduced. And what precedent will be set (and has already been set in other states) by capping juries -- tipping the scales of justice that have 200 years of tradition behind them? Will a similar cap be sought by automobile manufacturers? Cigarette makers?
As legislators struggle with these and other questions, it's clear that whatever has caused it, this crisis is everyone's problem, not just doctors'.
On the Legal Front -- Idaho has just enacted tort reform to limit the amount juries can award starting July 1 for non-economic damages related to medical malpractice to $250,000. But in Idaho, victims of malpractice can seek punitive damages -- something Washington citizens cannot do. Still, the Washington State Legislature is working on a law of its own to address what doctors and insurance companies are calling a crisis. Meanwhile, a law favored by the White House to set federal limits is also in process. If enacted, it could trump state laws, although the current bill would allow states to adapt it in some ways.
Washington Bill 1928 -- Up until late last week, Washington state had two major bills in the works for tort reform: House Bill 1928 and Senate Bill 5209. But as of Friday, SB 5209 is now technically dead, after failing to pass through a hearing.
A new provision was recently attached to HB 1928 that adds a $500,000 cap on all damages, both economic and non-economic. This cap only applies to public hospital districts that have geographical boundaries of 30,000 of fewer people. House Bill 1928 would cap, or limit, a jury to a maximum award of $350,000 for non-economic damages.
The bill requires an injured patient to file the malpractice claim within one year of knowledge of injury, or within three years of injury. It would also limit a trial lawyer's compensation according to the amount won by the plaintiff. Opponents argue that by limiting a trial lawyer's compensation percentage, the bill will greatly reduce a plaintiff's chances of obtaining qualified legal counsel. However, proponents of the bill argue that trial lawyers can take up to 40 percent of an injured patient's award money, contributing to the increase in doctors' malpractice premiums.
U.S. Bill HR 5 -- The federal tort reform bill, HR 5 caps juries at just $250,000, but allows each state to determine its own cap, either higher or lower. Opponents of the federal bill say that HR 5 is written not only to benefit doctors, but also for nursing home operators, medical device manufacturers, pharmaceutical companies, hospitals and even HMOs; all are covered by the bill's definition of "health care liability claim" and would be equally insulated from liability. Proponents insist the cap would not hinder justice for injured patients, but limit "astronomical" awards, thus lowering premiums. However, representatives of insurance companies say they can't promise that such a cap on jury awards will actually lower premiums.
Publication date: 04/10/03
