Exposing Myths About Medical Malpractice

Steve Klearman
Attorney
(866) 735-1102 Ext 535
Posted by Steve KlearmanNovember 17, 2009 11:15 AM
Tags: None

The American Association for Justice, in its efforts to promote health care reform, has attacked health care reform opponents' arguments that reform will be a heavy financial burden on the health care system.

“All the facts and evidence show that tort law changes will do practically nothing to lower costs or cover the uninsured,” said AAJ President Anthony Tarricone. “It’s no wonder the tort reformers, insurance lobby, and other corporate front groups have to gin up lies and phony stats, since no legitimate data or research supports their claims. Our focus should be on reducing the 98,000 deaths by medical error that occurs every year, not limiting patients’ legal rights.”

The American Association for Justice takes a look at the misconceptions behind the most common positions of health care reform opponents in its Five Myths About Medical Negligence:

  • Myth #1: There are too many “frivolous” malpractice lawsuits.

Fact: There’s an epidemic of medical negligence, not lawsuits. Only one in eight people injured by medical negligence ever file suit. Civil filings have declined eight percent over the last decade, and are less than one percent of the whole civil docket. A 2006 Harvard study found that 97 percent of claims were meritorious, stating, “portraits of a malpractice system that is stricken with frivolous litigation are overblown.”

  • Myth #2: Malpractice claims drive up health care costs.

Fact: According to the National Association of Insurance Commissioners, the total spent defending claims and compensating victims of medical negligence was just 0.3% of health care costs, and the Congressional Budget Office and Government Accountability Office have made similar findings.

  • Myth #3: Doctors are fleeing.

Fact: Then where are they going? According to the American Medical Association’s own data, the number of practicing physicians in the United States has been growing steadily for decades. Not only are there more doctors, but the number of doctors is increasing faster than population growth. Despite the cries of physicians fleeing multiple states, the number of physicians increased in every state, and only four states saw growth slower than population growth; these four states all have medical malpractice caps.

  • Myth #4: Malpractice claims drive up doctors’ premiums.

Fact: Empirical research has found that there is little correlation between malpractice payouts and malpractice premiums paid by doctors. A study of the leading medical malpractice insurance companies’ financial statements by former Missouri Insurance Commissioner Jay Angoff found that these insurers artificially raised doctors’ premiums and misled the public about the nature of medical negligence claims. A previous AAJ report on malpractice insurers found they had earnings higher than 99% of Fortune 500 companies.

  • Myth #5: Tort reform will lower insurance rates.

Fact: Tort reforms are passed under the guise that they will lower physicians’ liability premiums. This does not happen. While insurers do pay out less money when damages awards are capped, they do not pass the savings along to doctors by lowering premiums. Even the most ardent tort reformers have been caught stating that tort reform will have no effect on insurance rates.

For Five Myths About Medical Negligence in its entirety, click here

8 Comments

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Jim O'Hare AIC AIS VP med mal claims
Posted by Jim O'Hare AIC AIS VP med mal claims
November 19, 2009 10:39 AM

Several comments from a med mal claims guy since 1985
- Aetna and BC/BS do not provide healthcare, they are just brokers with a 35% overhead.

- There is too much med mal. I dont buy 98000, as I dont believe that only 5% of med mal turns into litigation. Can the plaintiffs bar really allow 90000 claims go un attended?

- RE the 5 Myths:
1 - There arent too many frivelous suits, as it costs money for you to bring them. Some are better than others.

2 - Healthcare costs is the problem with HC costs. There is a license for them to steal. Med mal is a distant cousin to the cost of HC. Who would care about defensive medicine if it was cheap?

3 - Doctors do flee. Ill and Tx and Pa had huge problems til tort reform brought them back. There are counties in Fl w/o neurosurgeons and OB's.

4 - Of course the # of claims drives up premiums. This is true for all lines. i.e.- find me cheap hurricane insurance in Florida. Not there. Why? - the # of claims. See what happens to juniors auto premium when he reports his 3rd accident.

5 - tort reform does lower rates. In 2004 there were 3 med mal writers in Fl, now there are 30+. A cap for P&S allows underwriters and raters to plug a real objective number into the premium equation, as protection against an open ended concept as what pain is worth. You cant rate infinity and make an equation work. WE can discuss the amount of the cap , but not the necessity. Rates in Florida have decreased 5 years in a row due to tort reform and competition. The same would work for healthcare.

regards Jim

Mike BryantInjuryBoard Attorney Member
Posted by Mike Bryant
November 19, 2009 10:51 AM

Interesting that you would use a hurricane and a third at fault accident as the examples. If a doctor gets to that level of malpractice shouldn't their rates go up? Should they even be treating anyone? Also you use the myth that things are better in Texas. Have you seen the list of most expensive places to find care? Caps only shift the burden to society and let those at fault do cost benefit analysis on peoples lives.

Jim O'Hare med mal claims guy
Posted by Jim O'Hare med mal claims guy
November 19, 2009 11:11 AM

Dear Mike- My point was that the number of claims are a direct cause of premiums going up, this is always true for any type of claim. Hurricane insurance would be dirt cheap in Kentucky- no claims.

Things are better in Texas, evidenced by doctors moving there, strictly due to a better litigation climate due to reforms. They didnt go there because the HC is expensive. The cost of the healthcare in Texas is completely unrelated to the med mal climate. Healthcare costs are not set by the physicians are they? The Healtcare brokerage megagiants are driving that bus. How do you connect med mal reforms to the cost of healthcare. Kinda like blaming Ford for the price of a gallon of gas.
regards Jim

Mike BryantInjuryBoard Attorney Member
Posted by Mike Bryant
November 19, 2009 11:49 AM

Sure, people with more claims should pay higher premiums. So your doctor with hurrican type damge shouldn't be shocked. Actually shouldn't be practicing medicine.

I'm not the one making the link. You are. I understand what you wrote as calling for caps to make a differance in this healthcare bill. It simply won't. Texas still has high costs with caps, they may have attracted bad docters and in the end the consumer suffers. The practice of medicine is not safer in anyway what's so ever.
Minnesota has low rates, low number of cases and great heathcare. No caps. We have a system that works.

Jim O'Hare AIC AIS VP med mal claims
Posted by Jim O'Hare AIC AIS VP med mal claims
November 19, 2009 12:06 PM

Dear Mike - I think that you missed my point all together. The cost of healthcare has nothing to do with med mal costs. Med mal, litigation and PL premiums are in one bucket, and the cost of getting your broken leg fixed is another bucket for the price of an arm and a leg, is in the other bucket.

You can say the cost of HC causes medical mistakes, as most cases are related to fatigue, poor staffing and bad communication due to fatigue. All staffing issues due to the cost of HC.
regards Jim

Mike BryantInjuryBoard Attorney Member
Posted by Mike Bryant
November 19, 2009 12:14 PM

I agree with everything there. So why are you calling for caps? They don't work for the consumer. We do need real reform, and we very much need a health care bill that not only provides coverage, but protects people.

Jim O'Hare AIC AIS VP med mal claims
Posted by Jim O'Hare AIC AIS VP med mal claims
November 19, 2009 1:50 PM

Dear Mike:
Math guys, actuaries, raters and underwriters get together and come up with complicated calculations to arrive at a premium for a specified amount of insurance. Policy limit is = to a cap of sorts.

So you know what you are selling for the price. A cap or policy limit is just an upper end, worse case scenario, to make all the equations work to justify the premium. If you place a zero or infinity in any equation, it yields no result.That is why we need a cap and speed limits.

As I said- we can argue the amount of the cap but not that they arent needed., if only to make the math work.

For every other cause of compensible action there is a formula. Lets say, my insured kills your client , he is 60 earning $50k/yr. What are the economics here and how did you determine it? You objectively determined the value of an objective loss. What is it worth if he was to work forever?

Pain and suffering is a subjective concept that cant be measured, seen, tasted nor weighed. Alot is always a good response for what pain is worth. One guys pain cant be measured against another to determine a value. A cap is just an upper limit. I have seen $1mil awarded for pain, suffered for 3 minutes, as well as a lifetime worth.

You cant buy happiness nor pain and suffering.
regards Jim

Yes fix healthcare, the #1 problem

Mike BryantInjuryBoard Attorney Member
Posted by Mike Bryant
November 19, 2009 9:02 PM

Actually you talk of damages as if they are mystical. In reality they are affected by experienced lawyers that know how to work up a claim, ask the right questions, and prove the case. I've never had an issue with arguing pain and suffering. But I deal with real people and not just numbers.

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