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Bad Medicine

Posted August 2, 2006

Opinion

Medical malpractice suits account for the tiniest fraction of health care costs. With more doctors than ever, politicians pushing tort reform are prescribing a bad remedy for an imagined disease.

By Blake Bailey

I am a personal injury trial lawyer in Texas. My clients’ access to the courts and their ability to fight large corporate interests, including insurance companies, depends on their ability to contract with me on a contingent basis. In other words, I don’t get paid unless I win their lawsuits. For pure economic reasons I have always been reluctant to take on an expensive, complicated case unless I determine it has strong merits. This has always been true in medical negligence cases because they are time-consuming and demand large cash outlay.

I decided to represent injured parties who need a champion in the courtroom because it seemed like a noble cause. I also felt I could do a public good by acting as a check and balance to encourage reasonably safe products, prudent conduct in the workplace and on the roads, and conscientious professionals. Trial by jury, I have always believed, should be the great equalizer.

Efforts to cap monetary damages and other “tort reform” measures, such as recent legislation in my home state, compromise this fundamental right. Supporters of tort-reform initiatives claim that special protection for medical providers is necessary to avoid a diminishing of the doctor population and to stop rising, outrageous medical costs. But on what evidence could anyone exercising intellectual integrity base such a claim?
There is no credible national study showing a decrease in doctors. The doctor population is increasing impressively. According to a 2004 American Medical Association report, the number of physicians practicing in the U.S. grew 203 percent from 1965 to 2003 — four times faster than the population growth. The number of high-risk practices grew dramatically during the same time period. Applications for residency training positions by medical school seniors hit a 20-year high in 2006, according to information provided by the American Association of Medical Colleges.

President Bush said in a speech in 2004 that lawsuits were “driving docs out of business,” yet it is undisputed that malpractice costs amount to only .0062 of our nation’s health care costs — less than two-thirds of a penny of a health care dollar. Ironically, the insurance industry tries to prove there is a crisis by citing the huge premiums it charges doctors and hospitals without any statistical basis justifying their rates. Historically, states that pass “tort reform,” including Texas, have not been rewarded by lower insurance premiums.

The lack of economic impact of medical negligence cases is not a new revelation. Texas has been no exception to the national experience. The Tonn study, in 1992, financed by the Texas Trial Lawyers Association, Texas Medical Association and the Texas Hospital Association, found no medical malpractice crisis and concluded that “changing the medical professional liability system will have minimal cost savings impact on the overall health care delivery system in Texas.”

Most recently, a study reported in the July 2005 Journal of Empirical Legal Studies entitled “Stability, Not Crisis: Medical Malpractice Claim Outcomes in Texas, 1988-2002” concluded that there was an overall picture of stability which did not justify legal reform in Texas.

Nevertheless, in 2003, voters here passed Proposition 12, which amended Texas’ constitution to allow the legislature to cap one type of damages in civil cases. The measure made constitutional the damage cap in medical malpractice cases that state lawmakers had passed earlier in the year. Since then, supporters of the reform have held it up as a model of tort-reform that other states and federal lawmakers can follow.

But the malpractice legislation is a classic example of power over reason, castrating the protection of Article I Section 3 of our state constitution, which mandates that no individual or group of individuals be allowed special rights or privileges over other citizens, and Article I Section 15, which guarantees the right to trial by jury.

Texas, as in other jurisdictions, tries to make a victim whole by allowing money damages if it is found that a doctor or hospital breached the recognized standard of care and foreseeably caused injury to the patient. The damages allowed in a medical negligence case are the same for which each of us is accountable if we negligently hurt someone, such as in an automobile accident.

One category of damages is economic. It can be figured by an accountant gathering some data and making projections of earnings, or earning capacity, and medical expenses.

The other category is “human damages,” or, as the insurance industry wants to call them, “noneconomic loss.” Human damages are pain, anguish, disfigurement, physical impairment or the loss of a relationship with a close family member killed or profoundly injured.

Under the current malpractice law in Texas this is capped at $250,000 in almost all cases. This cap doesn’t stop frivolous lawsuits. Its effect is on the meritorious ones with overwhelming human damages. The net good is for the insurance industry.

People skeptical of awards for human damages say that money can’t replace quality of life and should not be considered by a jury. Yet compensation for the cost of burying your child wrongfully killed, and nothing else, does not meet the sense of justice that our courts should provide. Certainly the right to trial by jury should not be inhibited without compelling state or national interests. Where is the evidence that there is a crisis that justifies this attack on our civil justice system? Why should doctors and hospitals be afforded more protection than the rest of us?

Statistics show the disingenuous nature of the lawmakers, but it is the individual examples that explain the unfair impact of damages caps. True life examples such as a child transformed into a rag doll due to septic shock resulting from untreated infection at an IV site, a woman who loses her arm because of an inappropriate administration of Phenergan, and a mentally disabled woman raped by a nurse’s assistant in a nursing home, all are limited to a minimal recovery because of the preponderance of human damages in such cases.

Insurance companies will say they are pressured to take settlement offers from injured patients because juries tend to award patients more than their cases are worth. The reverse has been my experience. Defendants normally win their cases, and juries are much more likely to award a conservative amount than an excessive one. Many times good cases settle for less than their value because the injured patients are less able to afford the risk of trial than a large insurance company.
If a new medical malpractice client came into my office and I determined she was one of the people who deserved a day in court, I would have to hire an expert in the same field of expertise as the defendant and provide 60 days’ notice before even being allowed to file a lawsuit or conduct discovery. After I file suit, I must provide a detailed expert report within 120 days from the date of filing, armed with a maximum of two depositions. Peer review at a hospital of a negligent act of a doctor — regardless of how egregious — is forever secret. The doctor or hospital will automatically have colleagues who will assist in the defense. My fees and expenses must come out of the victim’s recovery and can not be mentioned to the jury.

In Texas, the professionals being driven out of the arena are not the doctors but competent attorneys who have the ability to represent someone injured in a sophisticated case. Many of my fellow attorneys refuse to look at any case if it is a post-tort reform medical malpractice case.

Do the vast majority of doctors who practice competently and ethically really want the last vestige of check and balance taken out of the system? The Texas Board of Medical Examiners is at best lax in weeding out the doctors who should not be practicing. Of doctors in Texas found to have provided substandard care, incompetence or negligence, 3 percent received a revocation or suspension of their license, according to a July 2002 press release by the consumer watchdog group Public Citizen.

In the 2003 campaign leading to the passage of the Texas medical malpractice tort reform, insurance campaigners promised a 17 percent to 19 percent reduction in premium costs. What wasn’t pointed out was profits of the insurance companies went up 225 percent between 2002 and 2003. After tort reform’s passage, Governor Rick Perry bragged about Texas Medical Liability Trust reducing its premiums 12 percent, but he neglected to mention the previous 140 percent in increases it pushed past the Texas insurance commissioner.
The function of insurance premiums is dependent on investments the insurance companies are making and the political power they have with the state insurance commissioners. The effect of lawsuits comes in a distant third.

After the passage of medical malpractice caps, the various insurance companies attempted to raise their rates again, flying in the face of their promise for a premium reduction if the measure passed. The Texas Medical Liability Insurance Underwriting Association sought a 35.6 percent increase, and GE Medical Protective filed for a 39 percent increase.

It wasn’t until after Bohn Allen, the new president of the Texas Medical Association, Dan Gattis, a Republican from Georgetown and vice chairman of the House Civil Practices Committee, and Dan Lambe of Texas Watch and others raised unmitigated hell that premiums were reduced marginally. The appearance of reduction was helped by taking some of the coverage off the table. If you talk to Texas doctors, they will probably tell you their premiums went down all right, but so did their coverage. Be assured that the rates will rise once the furor is over.

Now the federal politicians have been persuaded by doctor, hospital and insurance groups to violate the equal protection and right to trial by jury provisions of the Seventh and 14th Amendments to the United States Constitution by pre-empting what is left of rights of injured patients in favor of doctors and hospitals. That’s the bad news. The good news here is that patients’ rights have been so devastated in Texas by state law, there isn’t really anything else that can be done to hurt a victim of medical negligence by federal pre-emption.

Trial by jury is the American right Thomas Jefferson held in higher esteem than the right to vote. It is a right that exists only if we have a sense of fairness for all who come to our courts to be heard. Courts resolving issues of human suffering must be given the power to grant justice for all individuals and not just for the powerful.

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