The End of Malpractice Litigation? Improving Care and Communications to Reduce Risk

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1 21 st Annual Health Law Institute March 13, 2015 Session #2 10:30 am 12:00 noon The End of Malpractice Litigation? Improving Care and Communications to Reduce Risk Charles J. Chulack, III, Esq. Linda Haddad, Esq. Horty, Springer & Mattern, P.C. Pittsburgh 1

2 2

3 Failure to come up with a solution is due to failure to agree on the problem. What Is The Problem? 1. Malpractice? 2. Insurance premiums? 3. Litigation? 4. Fear of litigation defensive medicine? 5. Communication 3

4 Our Premise Goals: Avoid harm Communicate effectively Identify problems early Investigate thoroughly Disclose timely Apologize Remediate Empathy 1. Malpractice 4

5 Studies are very consistent. Medical Injury, Malpractice Litigation, and Patient Compensation in New York Harvard Medical Practice Study (February 1990) 5

6 13.5% of Medicare admissions suffer adverse event. HCQIA 42 U.S. Code Findings The Congress finds the following: (1) The increasing occurrence of medical malpractice and the need to improve the quality of medical care have become nationwide problems that warrant greater efforts than those that can be undertaken by any individual State. 6

7 (April 15, 2010) Reducing the number of preventable patient injuries in California hospitals from 2001 to 2005 was associated with a corresponding drop in malpractice claims against physicians, according to the RAND Corporation, a non-profit research organization. 7

8 2. Insurance Premiums Doctors Plea for Tort Reform Some progress Addresses symptom, not problem 8

9 MICRA (Cal. 1975) 100% of economic damages $250,000 cap on non-economic damages Limit on lawyers fees (sliding scale) Double recovery disclosure Periodic payment of future damages Types of Reform Limitation on Damages Restriction on Attorneys Fees Periodic Payments Statute of Repose Venue Rule (Pa.) Mandatory Arbitration Abrogation of Collateral Sources Expert Review 9

10 In 2006: 26 states had some cap on damages 16 states limit attorneys fees 11 collateral source rule 31 states periodic interim payments 20 have pre-litigation screening panels State Approaches: Some Examples 10

11 Texas Malpractice Cap on Non-Economic Damages: $250,000 Praise for the Malpractice Cap in Texas: More docs coming to state to practice Reduction in frivolous cases 11

12 Criticism of the Malpractice Cap in Texas: Insignificant effect on loss savings because noneconomic damages are a small % of total losses paid Disincentive for docs to prevent medical errors Failure to compensate patients who were injured for egregious conduct No effect on practice of defensive medicine Growth of physicians commensurate with growth of population Are caps legal? NO! Lebron v. Gottlieb Mem l Hosp. (Ill. 2010) Cap on non-economic damages is a legislative remittitur which encroache[s] on [a] fundamentally judicial prerogative 12

13 Are caps legal? YES! Garhart v. Columbia/Healthone (Colo. 2004) Cap on non-economic damages constitutional. No right to jury trial in civil case. Sorry laws in 37 states. 13

14 Georgia s Sorry Law : Covers statements of apology, compassion, mistake, and error Pennsylvania s Sorry Law : Much narrower than Georgia s. Only covers statements of apology and compassion, not statements of fault. (More on this later ) 14

15 Effectiveness of Sorry Laws Questionable no empirical studies Some laws allow for evidence of an apology to be admitted for other reasons May encourage development of Communicate and Resolve programs Certificates of Merit 15

16 Certificates of Merit Generally, require, at the time of filing suit, certification by a medical expert that standard of care was not met. Certificates of Merit Praise: Reduces number of frivolous lawsuits 16

17 Certificates of Merit Criticism: Do not deter substandard care Do not address compensation of negligently injured patients Certificate of Merit Are they legal? Some states say no 17

18 Putnam v. Wenatchee Valley Med. Ctr. (Wash. 2009) Requiring medical malpractice plaintiffs to submit a certificate prior to discovery hinders their right of access to the courts. What about Pennsylvania? 18

19 Medical Care Availability and Reduction of Error Act ( MCARE ) Three-pronged approach: Improvement of patient safety MCARE and Patient Safety Patient Safety Plans Medical error reporting Notification of Serious Adverse Events 19

20 MCARE Three-pronged approach: Improvement of patient safety Legal reforms MCARE and Legal Reforms Stringent qualifications for expert witnesses Sanctions for frivolous claims Seven years SOL 20

21 MCARE Three-pronged approach: Improvement of patient safety Legal reforms Insurance restructuring MCARE and Insurance Replaced the CAT Fund Provides for insurance in excess of primary/basis insurance Funded through an assessment on providers 21

22 Venue Shopping Prohibition In Medical Malpractice actions, plaintiff must file with the complaint, a certificate of merit signed by the attorney or party. 22

23 Benevolent Gesture Medical Professional Liability Act (2013) benevolent gestures are prohibited from introduction as evidence of liability. Includes: statements that convey a sense of apology or compassion Does not include: statements of negligence or fault How is Pennsylvania s system working? Big reduction in the number of med mal suits filed: , , , ,546 23

24 How is Pennsylvania s system working? Continues to be high success rate at trial for the defense in med mal cases: Jury trials (2013) -77.3% Non-jury trials (2013) 40%* *But, only 5 non-jury trial verdicts Why are these not the answer? 24

25 CBO 2009 Study Tort reform might cut costs by 0.5%, saving roughly $11 billion out of a $2.5 trillion budget. AHRQ, January 4, 2010 Review of Reforms to our Medical Liability System 22 /$1.00 in tort system to consumer compensation 2% of negligent injuries resulted in a claim 17% of claims involved negligent injury 25

26 Health Affairs, September 10, 2010 National costs of medical liability system $55.6 billion in 2008 dollars 2.4% of total health care spending Indemnity payments Administrative expenses Insurer overhead Defensive medicine Other 3. Litigation 26

27 40 cents of every dollar spent on litigation reaches injured patients. Money Spent on Litigation (1990 Report) 60% to 75% cases closed with no payment to claimant. 27

28 Average Length of Litigation months average time from claim to resolution Range up to 11 years Fear of Litigation 28

29 Malpractice As Dread Risk, Health Affairs, 29, No. 9 (2010): 1585 Most significant, least measurable cost: Anxiety about being sued 1. Fear disproportionate to risk (plane crash vs. car crash) 2. Not assuaged by tort reform 29

30 5. Communication Desired outcomes: 1. Reduce errors 2. Compensate patients promptly/ fairly 3. Reduce/eliminate litigation 4. Create safe harbor 30

31 Clinical protocols as defense: Levine vs. Rosen Washington vs. Washington Hospital Center REDUCING ERRORS/IMPROVING CARE IS ATTAINABLE!!! 31

32 HHS reports a 17% decrease in hospitalacquired conditions from 2010 through 2013 We estimate that approximately 50,000 fewer patients died in the hospital as a result of the reduction in HACs, and approximately $12 billion in health care costs were saved from 2010 to

33 Physician mentorship program for new attending physicians at Magee-Womens Hospital in Pittsburgh Preliminary findings: Mentored physicians had less serious medical events Mentored physicians followed established hospital protocols at a higher rate Mentored physicians had higher rates of patient satisfaction 33

34 But, bad things happen. Investigate Disclose Apologize (Sorry laws) Remediate And, Back to Communication 34

35 What Is the Cause of Litigation? Bad outcome Injury Anger Sense of unfairness Vengeance Patient/family wants to know what happened (cases withdrawn at conclusion of discovery) PHTS Experience A. Steps: 1. Prompt reporting of incidents 2. Prompt investigation, including interviews 3. Preserving records 4. Meet with injured party/family 5. Discuss facts openly 6. Offer remuneration commensurate with injury 35

36 B. Results: PHTS Experience 1. Financial savings 66% ($8 million from mid-2012 to mid-2014) 2. EVERY SINGLE INCIDENT avoided litigation 3. Average cost of early resolution case: $16, Average cost of one progressing to lawsuit status : $143,000 Human benefits, too: Sterile pack case Picasso 36

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