Malpractice! A Consumer View

Malpractice insurance is a cost to medical doctors and other practitioners. It is an expense to consumers when its cost is passed along. As a cost of doing business it comes off the bottom line: reduces profit. Some costs of providing a product or service can be and often are absorbed by producers. Since all providers in a given industry, business or service will have the same cost centers Adam Smith’s ‘Invisible Hand’ sometimes appears to make this happen. It has a parallel in religion when prayer is ascribed to cause a positive effect. Or it forces the producers to reduce those costs through less costly substitutes and complements. An example of a compliment is the use of gasoline to provide energy to an automobile. An example of a substitute is the use of public transportation in lieu of using a private car.

When it comes to malpractice and its insurance coverage there are few compliments or substitutes. But there are simple ways to avoid lawsuits! The field of malpractice insurers in many state markets over time was reduced to a few suppliers. In economics a few suppliers or supplier oligopoly means less competition, less innovation and a captive consumer market. In some states physicians attempted to establish malpractice companies that its profession owned and operated. In a few states several insurers created risk pools and a few states created a government owned insurance company. None of these efforts corralled the horse that was out of the barn and remain so until the level of malpractice was reduced. Innovation, alternatives, and efforts to minimize malpractice insurance were as with primary prevention of illness, disease and injury ignored. The pattern of reactive thinking as applied to illness, disease and injury carried over to malpractice. And as medical practice increasingly faced illness and disease that seemed to have no rhyme or reason and continued to be intractable to medical products and services so was the issue of medical malpractice.

The issue again boiled down to money. When there was avoidable malpractice, there were actual damages due to the malpractice, the malpractice and damages were not the fault of the patient and there was an ability to calculate an amount of money to offset the damages, a lawsuit is one method to correct the medical malpractice impact. A lawsuit means money is being sought to compensate the person claiming malpractice and damages. In addition many lawsuits sought punitive damages and payment of intangibles as mental distress, inconvenience and loss of sexual or other favors.

This issue of Health Perspectives sought to provide the many voices involved with medical malpractice an opportunity to express their concerns, viewpoints and sometimes solutions. To the medical doctor facing a substantial insurance premium bill or a notice of litigation, the issue is real and personal. To a family member experiencing the pain, suffering or death of a family member due to alleged malpractice is also real and personal. To a medical insurance executive the matter is one of dollars and cents and is real but less personal. To a lawyer representing people who have been injured or died due to alleged malpractice the issue is real and less personal but potentially very financially rewarding. To elected representatives the issue is important for re-election. But which side to support is dependent on the relevant electoral weight of special (i.e. hospitals, doctors, lawyers, insurance companies) versus the public (i.e. people who seek just or in the eyes of some excessive compensation for malpractice damages) interest.

Many solutions have been offered. As with medical cost controls in general, all fall short of the goal. The best scenario is to avoid malpractice, to not cause unjustified expectations of successful outcomes and avoid malpractice lawsuits. Court decisions over the years have defined heavy burdens for litigants. Malpractice suits can run for years and are expensive to develop and argue successfully. Yet, when claims reach the courts there are factors that support litigants including a jury that while totally convinced that malpractice occurred patients with a hideous outcome after medical care received have a sympathy factor in their favor.

Another solution is to cap the monetary damages. This concept has proven workable in other areas of damages including workers’ compensation. However, ingenious counsel can almost always get around the limits set in rules and regulations. And often out-of-court settlements are arranged for reasons other than the fear of a loss. Public exposure accompanied by threats of new regulations and enforcement as well as the expense of defense with no assurance of victory all plays a part in the drama. Exposure that is to be avoided at all cost includes the systemic error or structural defect that can excite a class action. Faulty equipment, misuse or failure to apply standard procedures has led to multiple suits being galvanized into one multi-million or billion dollar action. One recent example was the over diagnostic radiation of patients at one hospital that led to skin burns and cancers. Needless to say the state involved had to move quickly to avoid a CCAHS type revelation in the New York Times. Instead of the Times exposing lethargy and cover-up the story reported quick action to identify the patients and prompt notice of the potential damage.

While even the best of the best can perform malpractice the best of the best have shown that the way to avoid malpractice suits is to confront the family with the fact that an error occurred. The physicians and hospitals taking this open transparency (i.e. honest and truthful) approach have been rewarded by fewer suits and less costly settlements. Their honor was not impeached and their reputations were not tarnished; in fact enhanced.

Unfortunately, CCAHS did not effectively connect the issue of hospital inspections reports of failures to comply with state and federal laws and the (today) is called ‘best practices’ of the medical profession.

Malpractice is still a hot button issue. As seen elsewhere in this description of CCAHS publications, as doctors took on the role of employed medical care givers with paid malpractice insurance, their opposition to patient litigation has dramatically decreased. The types and numbers of malpractice claims, suits and settlements is a very gross measurement of quality. Malpractice claims vary by class, education, the degree of the damage and most importantly how the provider responds and reports the malpractice to the patient and family. One thing is clear: the solution to this problem is not capping damages but as with other aspects of medical care delivery preventing and reducing malpractice.