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Medical Malpractice Tort Reforms


Medical Malpractice Tort Reforms Group A: Mirna P Amaya Louis Daniel Velasco Gail Young Jingbo Yu William Walders Agenda Definitions Review of Medical Malpractice and ... – PowerPoint PPT presentation

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Title: Medical Malpractice Tort Reforms

Medical Malpractice Tort Reforms
  • Group A
  • Mirna P Amaya
  • Louis Daniel Velasco
  • Gail Young
  • Jingbo Yu
  • William Walders

  • Definitions
  • Review of Medical Malpractice and Tort Reform
  • Historic Legislation and Policy efforts
  • National, State malpractice reform
  • Republican Democrat Perspective
  • Policy and Fiscal Implications of various
  • Proposed Legislation
  • Rationale, Target Groups, Mechanism, Financing,

Basic Concepts
  • Medical malpractice
  • A physician's deviation from the applicable
    standard of care that a similar physician would
    exercise under the same circumstances.
  • Tort
  • A wrong or injury committed against a person
    or property.
  • How do they fit together?

Historic Legislation Policy efforts
  • 1768Sir William Blackstone
  • Commentaries on the Laws of England included
    under mala praxis (from which we derive the
    modern word malpractice)
  • "Injuries . . . by the neglect or unskillful
    management of physician, surgeon, or apothecary .
    . . because it breaks the trust which the party
    had placed in his physician, and tends to the
    patient's destruction."
  • Mohr, James C. American Medical Malpractice
    Litigation in Historical Perspective.
    JAMA. 20002831731-1737.

History Context of Establishment
  • 1830s-1840s
  • Marketplace professionalism
  • Physician competition, few quality control
  • Lawyer hustling for business of their own
  • Malpractice emerged as a tempting new growth area
    for aggressive lawyers.
  • Other factors
  • Sharp decline of religious fatalism
  • The nations first widespread efforts to improve
    physical fitness and its first great food reforms
  • Patients were no longer willing to dismiss
    unfavorable medical outcomes as either inevitable
    or normal.

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History Establishment
  • 1850Medical malpractice litigation was an
    established phenomenon.
  • Explosion of medical malpractice suits
  • 1840 -1860, the number of malpractice cases
    increased 950.
  • Effect
  • Did it drive charlatans and amateur hacks from
    the field?
  • No accepted standards
  • Physicians became victims of their own medical
    advance (orthopedic cases)
  • Cut deep chasm between physicians and lawyers

History continue to expand?(Two explanations)
  • Development in US medicine
  • Medical innovations fracture, X-ray tech
  • Benefit to patients
  • Medical mistakessource of malpractice actions
  • Standards
  • AMA(1847) tried to bring order to the medical
    marketplace (education, standard, licensing)
  • Drove unqualified healers from the field
  • Rendered physicians more vulnerable to
    malpractice suits
  • Liability insurance for physicians
  • Physicians not had to face the prospect of
    personal bankruptcy
  • Guaranteed the perpetuation of the existing
    system into the 20th century

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History continue to expand?
  • Development in US law
  • Contingent fee arrangement
  • Plaintiffs risked nothing in bringing charges
  • Lawyers gravitated toward cases
  • Ordinary juries
  • Gave every case a chance
  • The unique nature of tort pleading in the U.S.
  • Tort private civil wrongs that violate
    understood duties or social responsibilities
  • Malpractice a tort action or a contract action?
  • Physicians No contract relation between
  • Malpractice remained a tort vague, flexible,
    easily manipulated

History tort adjustment
  • 1900-1940s
  • states began to apply the res ipsa loquitur rule
  • the number of actions for medical malpractice
    increased sharply
  • 1960s
  • legitimated a quantum leap in the amount of money
    awarded in tort actions
  • 1975-1985 The average award in malpractice
    actions more than tripled
  • Today
  • physicians have joined insurers and businesses in
    an effort to curtail tort actions and to cap or
    reduce tort awards

Malpractice Liability Insurance
  • Physicians make up 7 out of 10 malpractice
    payments (NPDB Annual Report, 2005)
  • Physicians accounted for 52 of estimated medical
    malpractice premiums in 1999, followed by
    hospitals at 32 percent (source Conning Co.
    Allied health care, nursing homes and managed
    care organizations make up the remainder.)
  • Todays medical malpractice insurance market is a
    mix of
  • traditional insurers
  • provider owned
  • groups (physicians and hospitals) and
  • alternative risk transfer entities.

Insurers Losses Expenses Paid vs. Premiums
Over the period from 1996 through 2001, premium
earned rose 16.8 while losses and expenses rose
Source Computed from A.M. Best data by the
Insurance Information Institute
Increasing malpractice tort cost
  • Over the period from 1990 through 2000, medical
    malpractice tort costs rose 140, more than
    double the 60 increase in medical costs
    generally over the same period!
  • Over the period from 1975 through 2000, medical
    malpractice tort costs skyrocketed by 1,642
    while medical costs generally rose 449, nearly 4
    times as fast!

Sources Tillinghast-Towers Perrin, US Bureau of
Labor Statistics, Insurance Information Institute
Why do we need tort reform?
  • The cost of malpractice insurance rates has been
    skyrocketed in the past few years.
  • Medical Malpractice is a contributor to overall
    healthcare cost inflation
  • Doctors refusing to take on new patients, having
    to quit their practices, or relocating to other
  • If this trend continues, more and more doctors
    will be unable to practice, and as a result, more
    patients will have difficulty finding proper
  • Other concerns patient safety, quality control

Tort Reform
  • Since 2000, the issues of medical liability
    insurance costs and medical malpractice lawsuits
    have been prominent on both state and
    federal legislative calendars.
  • Medical malpractice liability is governed by
    state law, but Congress has the power, under the
    Commerce Clause of the U.S. Constitution (Art. I,
    8, cl. 3), to regulate it.
  • In the 108th Congress, the House passed virtually
    identical bills (H.R. 5and H.R. 4280) that would
    have preempted state law with respect to certain
    aspects of medical malpractice lawsuits

National malpractice reform
  • Key issue in 2004 Presidential election and other
    congressional races (due to keen lobbying)
  • In 2005 Proposed Federal Legislation regarding
    medical Malpractice
  • In 2006 President Bush reiterated a call for
    Congressional action on medical liability reform
  • Reform has been maintained at the State level

National malpractice reform
  • Since 1970s
  • After WWII Nixon ordered a study
  • Findings increase in claims led insurers to
    increase premiums charges to unaffordable level
    or to refusals to write malpractice insurance
    (Luce, 2994)
  • Every state except West Virginia passed some
  • California's Medical Injury Compensation Reform
    Act (MICRA) enacted 1975 considered model law
  • Source Insurance information Institute
    Insurance issues series http//

Listing of bills for Medical malpractice
  • 1 . Medical Malpractice Insurance Corporation Act
    (Introduced in House)H.R.3865.IH2 . Medical
    Malpractice and Insurance Reform Act of 2005
    (Introduced in House)H.R.3359.IH3 . Medical
    Malpractice Relief Act of 2005 (Introduced in
    House)H.R.2291.IH4 . Emergency Malpractice
    Liability Insurance Commission (EMLIC) Act
    (Introduced in House)H.R.2400.IH5 .
    Comprehensive Medical Malpractice Reform Act of
    2005 (Introduced in House)H.R.2657.IH6 .
    Improved Medical Malpractice Information
    Reporting and Competition Act of 2005 (Introduced
    in House)H.R.2399.IH7 . Comprehensive Medical
    Malpractice Reform Act of 2005 (Introduced in
    House)H.R.3378.IH8 . Medical Malpractice
    Insurance Antitrust Act of 2005 (Introduced in
    Senate)S.1525.IS9 . Freedom From Unnecessary
    Litigation Act of 2005 (Introduced in
    House)H.R.3076.IH13 . Informed Choice Act
    (Introduced in Senate)S.755.IS14 . National
    MEDiC Act (Introduced in Senate)S.1784.IS15 .
    Medical Malpractice Reform Act of 2006
    (Introduced in House)H.R.4838.IH16 . Medicare
    Physician Payment Reform and Quality Improvement
    Act of 2006 (Introduced in House)H.R.5866.IH17
    . National Health Insurance Act (Introduced in
    House)H.R.15.IH34 . National Insurance Act of
    2006 (Introduced in Senate)S.2509.IS35 .
    National Insurance Act of 2006 (Introduced in

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Arguments for/against Reform
  • Against
  • Financial problems in the medical malpractice
    line are caused by poor investment returns and a
    cyclical insurance market, rather than by rising
  • Source Insurance information Institute
    Insurance issues series http//
  • Reform would dismantle state judicial authority
    and preempt all existing state laws governing
    medical malpractice lawsuits (National conference
    fo state legislatures, 2007)
  • For
  • Effects of the medical liability systems foster
    defensive medicine--medical practice based on
    fear of legal liability rather than on patients'
    best interests (Kessler, 2006)
  • Medical associations claim that rapidly
    increasing premiums the declining number of
    insurers often lead physicians to stop practicing
    medicine or to relocate shortage of physicians,
    especially high-risk specialties eg. neurology.
    (McKinley, 2005)

State Reform 2005
  • 48 state legislatures introduced over 400 bills
    to address medical malpractice reform
  • 32 states enacted over 60 bills
  • 2 states had Supreme Court rulings on medical
    liability lawsuit statutes

State Reform 2006
  • 36 state legislatures considering some type of
    medical malpractice legislation (as of May 1)
  • 9 states enacted malpractice bills (as of May 1)
  • 13 states are carrying over or reintroducing
    legislation from 2005

2005 2006 Reform Issues
  • Limits to non-economic damage awards
  • Allocation of plaintiff attorney fees as
    percentage of damage awards
  • Expert witness standards
  • Inadmissibility of apology statements by
    healthcare practitioners

State Reform 2007
  • Addressing and facing same issues as 2005 and
  • Greater focus in 2007 on
  • More accountability for insurance companies by
    requiring reports from medical liability
    insurance providers
  • Proposing various state controls on premium rates
  • Exploring litigation alternatives

California Liability Reform
  • Medical Injury Compensation Reform Act (MICRA) in
    1975 often cited as the model for legislative
    reform at the state level
  • 250,000 cap on non-economic damages while
    keeping economic compensation as unlimited
  • Shortened time lawsuit could be brought to 3
  • Periodic payment of damages to ensure money is
    available to patient in future
  • Positive consequences
  • Physicians not leaving, actually coming to CA
  • Premiums rising much slower

California Positives
  • 2004 study on MICRA
  • 30 reduction in damages paid by physicians
  • 15 reduction in compensation to injured patients
  • 60 reduction in attorney fees paid by plaintiff
  • Premium increases 1976-2000
  • California 167
  • US average 505
  • Florida over 2000

Consequences in Critical States
  • Effects on physicians
  • retiring early
  • relocating to states with better conditions
  • refusing to administer high-risk medical
  • Most affected OB/GYN, rural family physicians,
    neurosurgeons, other high-risk specialties
  • Effects on patients
  • losing access to care
  • safety is jeopardized
  • high costs

Stories from Critical States
  • Nevada
  • UNLV Medical Center closed trauma center for 10
    days in 2002 as a result of surgeons quitting for
    not being able to afford premiums increased from
    40,000 to 200,000
  • Dr. Cheryl Edwards closed her 10 yr. old OB/GYN
    practice in Las Vegas after her insurance premium
    jumped from 37,000 to 150,000 she now
    practices in west LA
  • Dr. Frank Jordan "I did the math. If I were to
    stay in business for three years, it would cost
    me 1.2 million for insurance. I obviously can't
    afford that. I'd be bankrupt after the first
    year, and I'd just be working for the insurance
    company. What's the point?"

Stories from Critical States
  • Pennsylvania
  • 44 physicians in Delaware County outside of
    Philly left the state or stopped practicing in
    2001 because of high insurance costs
  • 65 of physicians in Chester County said they
    were considering moving their practices to
    another state
  • Frankford Hospitals three facilities in Philly
    had all 12 orthopedic surgeons leave after their
    malpractice rates almost doubled to 106,000 in

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Florida Malpractice Situation
  • Florida Dept. of Insurance reported an increase
    in total indemnity payments of 3074 from 1975 to
  • 2002 malpractice insurance premium comparisons
  • Miami ? 106,497 avg. for specialists and
    212,994 avg. for cardio surgeons
  • Los Angeles ? 16,148 avg. for specialists and
    42,292 vg. for cardio surgeons
  • Between 2000 and 2002, more than 30 malpractice
    insurance companies left Florida, leaving fewer
    than 10, thus reducing competition

Early Florida Malpractice Attempts
  • In 1986, Florida legislature passed a reform bill
    including a 450,000 cap on non-economic damages
  • In 1987, the Florida Supreme Court declared the
    cap unconstitutional
  • 2003 rates and claim numbers at all time highs
    had driven all but 4 insurers out

Current Florida Malpractice Legislation
  • Original House bill during regular session
    included a 250,000 cap on non- economic damages,
    but failed to move through Senate
  • Three special sessions called by Jeb Bush in
    summer 2003 where final bill passed
  • 500,000 cap on non-economic damages which could
    be increased to 1,000,000
  • 150,000 cap on ER cases which could increase to

Florida Current Legislation
  • Three-strikes law
  • Voters approve trial lawyer backed three-strikes
    amendment on physicians in Nov. 2004 election
  • Judge rules for temporary injunction of
    three-strikes rule late in 2004 giving lawmakers
    more time to decide how law would work
  • Gov. Jeb Bush signed final bill on three-strikes
    law in June 2005
  • Final form
  • Single incident counts as only one strike
  • Florida Board of Medicine has final say on what
    is or is not a strike
  • Out-of state and civil case settlements do not
    count as strikes

Florida Current Legislation
  • Adverse incidents law
  • Voters approve trial lawyer backed adverse
    incidents amendment on physicians in Nov. 2004
  • Amendment was also challenged and changed
  • Final form signed by Gov. in June 2005
  • Only records created within four years of request
  • Only patient can request record of pertaining
  • Hospital or physician decide which records to
    turn over
  • Patient pays cost of providing the records

Florida Current Legislation
  • Attorney fee limitations law
  • 3rd amendment approved by voters in Nov. 2004 was
    physician backed
  • Signed into effect June 2005 without any changes
  • Limits attorney contingency fees
  • Patients get 70 of the first 250,000 awarded
  • 90 of any money awarded above 250,000

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Medical Malpractice statistics by U.S states
  • http//

  • http//

Trends in Premiums for Physicians Medical
Malpractice Insurance, by Type of Physician,
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Parties Perspectives
  • Republican
  • Caps on attorney fees
  • Caps on awards
  • Punitive
  • Pain Suffering
  • Certificates of Merit
  • Insurance
  • Assistance Funds
  • State Provided
  • Tax Credits
  • Reform
  • Reporting
  • Expert Witness Standards
  • Patient Information
  • Periodic Payments
  • Democrats
  • Evidence admission of
  • Doctors Apologies
  • Collateral Source
  • Arbitration
  • Mandatory Mediation
  • Emergency Liability
  • ER (Good Samaritan)
  • Volunteer Liability
  • Peer Review
  • Loss of License after X guilty verdicts
  • Revision of Statue of Limitations

Used or considered by Florida
Republican Trends
  • Limits to attorney fees
  • Lawyers can only collect X
  • Limited to first X thousand or some thereof
  • Capping awards given to defendants
  • Punitive Awards
  • Punishment for wrongdoing
  • Non-economic (Compensatory) damages
  • Pain and Suffering
  • Certificates of Merit
  • Expert reviews case prior to claimants

Republican Trends
  • Malpractice Insurance
  • Assistance funds
  • Insurance subsidized by state
  • Reporting
  • Required to be transparent
  • Expert witness standards
  • Define the appropriate qualifications of expert

Republican Trends
  • Information disclosure
  • Patient information
  • Release of information without violating Pt/MD
  • Doctor information
  • Public access to all doctors information
  • Amendment 7 Patients Right to Know about Adverse
    Medical Incidents
  • Periodic Payments
  • Dispersed via a payment plan
  • Stops when Defendant dies or is well

Does Florida List MD Information?
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Democratic Trends
  • Allowing more evidence
  • MD Apologies
  • Collateral Source
  • MDs insurance coverage admissible
  • Coverage
  • Limits

Democratic Trends
  • Arbitration
  • Binding
  • Requires 3rd party (judge-like person)
  • Mediation
  • Voluntary
  • Overseen by an independent 3rd party

Democratic Trends
  • Waiving Unintentional Liability
  • Emergency Situations
  • Volunteer Setting
  • Peer Review
  • Panel Review
  • Determines if action should be taken

Democratic Trends
  • Loss of license
  • Lose privilege to practice after so many guilty
  • Floridas Three Strikes
  • Amendment 8 Revision of Statues of Limitation
  • Statue of Limitations
  • Lengthen
  • Remove

Envelopes Please!
  • Open envelope
  • Look for your outcome
  • If Good Outcome then do nothing
  • If your facility messed up, then you have two
  • Disclose your mistake and pay the money to the
    patient (me)
  • Cover it up and keep the money

How do we fix it?
Our Proposed Legislation
  • Amend the Florida constitution to remove
    Amendment 8
  • This will be voted on in 2008 as Keep
    neurologists and OB/GYNs practicing medicine in
  • Propose legislation that includes
  • Removal of Volunteer Liability
  • Peer Review prior to trial

Proposed LegislationRationale
  • To ensure the state of Florida is considered as a
    place to practice, by frequently sued
  • Remove the fear of litigations from MDs who
    desire to volunteer their time.
  • Identify frivolous lawsuits before they enter the
    court system.

Proposed LegislationTarget Groups
  • Health care consumers/users
  • Health care providers
  • Hospital risk management
  • Insurance companies
  • Legal field (lawyers)

Proposed LegislationMechanism
  • These Amendment and new legislation will
  • Remove the barrier for prospective existing
    specialists to practice in Florida
  • Improve access to care for uninsured
  • Enable defensible lawsuits to enter the court

Proposed Legislation Outcomes
  • Physician will put patients first instead of fear
    of lawsuits
  • Stewards of healthcare resources
  • More throughput through free clinics
  • Drop in amount of frivolous lawsuits

Smile we are done!
Useful Websites References
  • Medical Malpractice Implications of Rising
    Premiums on Access to Health Care, Report
    GAO-03-836. Washington, DC Government
    Accountability Office, August 2003. (no author
    given) Also see http//
  • Mello, M.M. Medical Malpractice Impact of the
    Crisis and Effect of State Tort Reforms, Robert
    Wood Johnson Foundation, Research Synthesis
    Report No. 10, May 2006. Also see
  • CBO (Congressional Budget Office). 2004. The
    Effects of Tort Reform Evidence from the
    States. June. http//
  • Bovbjerg, R.R. and R.A. Berenson. Surmounting
    Myths and Mindsets in Medical Malpractice, The
    Urban Institute, October 2005. Also see
  • AHRQ (Agency for Healthcare Research and
    Quality). 2005.Medical Errors Patient Safety
    (AHRQ online resources, periodically updated.)
  • American Medical Association. 2005. Medical
    Liability Reform (Web page with links,
    continuously updated.) http//
  • http//
  • 2005 State of the States Malpractice Reform
  • http//
  • Floridas Practitioner Lookup

Useful Websites References
  • Florida Three-Strikes Law Targets Doctors, Nov.
    2004, http//,2933,139533,0
  • Florida courts take up two tort reform ballot
    measures, Jan. 2005, http//
  • Medical Malpractice Crisis Floridas Recent
    Experience, June 2004, http//www.circ.ahajournal
  • Florida bills limit scope of liability
    amendments, Aug. 2005, http//
  • Last insurance 'fix' hasn't slashed rates, Mar.
    2007, St. Petersburg Times
  • Confronting the New Health Care Crisis
    Improving Health Care Quality and Lowering Costs
    By Fixing Our Medical Liability System, July
    2002, U.S. Dept. of Health and Human Services
  • Medical Malpractice, Feb. 2007, Insurance
    Information Institute
  • Medical Malpractice Tort Reform, Feb. 2007,
  • U.S. medical liability trend showing strong
    signs of improvement, Dec. 2005, Healthcare
    Financial Management
  • Medical Liability Reform, Jan. 2006,

Useful Websites References
  • Posner KL, Domino KB, Polissar NJ, Conrad DA,
    Cheney FW Trends in Anesthesia Malpractice
    Lawsuit Payments. Anesthesiology, 101 A-1405,
  • Medical Malpractice statistics by U.S states
  • National compensatory Jury award median
    medical-malpractice cases http//www.juryverdictr
  • Trends in Premiums for Physicians Medical
    Malpractice Insurance, by Type of Physician,
    1993-2002. http//
  • Manhatan Institute for Policy Research.,Medical
    Malpractice Awards, Insurance and Negligence.
  • Mayeda et al. BMC Medical Ethics 2005 68  
    doi10.1186/1472-6939-6-8 Law cases of medical
    malpractice and results of principle component
    analysis of disclosure of medical records.
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