Remember the regular hand wringing about New York’s medical malpractice “crisis”?  Doctors were said to be leaving the state in droves.  OB/GYNs were dropping the OB.  Neurosurgeons were retiring early.  Hospitals and medical liability insurance companies in the state suggested they were close to bankruptcy…all because of the dreaded plaintiff’s lawyers and the “jackpot justice” they achieved for clients who were never really victims of medical negligence, but of unfortunate “complications” (such as operating on the wrong limb).

As it turns out, New York has been and remains a very physician-friendly state, and this has been reaffirmed by the latest news from Albany.  After two years of medical liability insurance rates remaining frozen in place, the new rates just announced by the state’s insurance commissioner amount to a 5% increase for most physicians.

And yet, Superintendent of Insurance James Wrynn concludes his delivery of the good news with even more fear mongering.  Yes, according to Mr. Wrynn, we are still in the midst of a “crisis” from which his leadership will extricate us (read to the end of the press release).

So, two years with no increases, followed by this year’s 5% increase, is indicative of a “crisis”?  I’d like to suggest that the only “crisis” taking place in this subject area is the one that involves the credibility of our state’s insurance executives.  It would be nice if that received some attention in the press.

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The State of New Jersey has taken an innovative approach to addressing a longstanding concern of physicians in high-risk practices.  According to the New Jersey Star-Ledger, a recently passed bill would require the state’s doctors and lawyers to each contribute toward a state fund that would ease the relatively higher medical malpractice insurance premiums paid by the state’s OB/GYN’s.

New York is about to implement an experiment involving NYC hospitals that aims to cut costs and time from the process of resolving medical malpractice claims.  The Times-Albany Union reports that the program calls for immediate admission of errors to victims of malpractice, followed by early, and apparently real offers of settlement from the hospitals’ insurance companies, under the guidance of specially trained judges. ( Here is the Healthcare Association of NY State’s take.) The program is based on the practices of Bronx County Supreme Court Justice Douglas McKeon, who has utilized similar principles while handling all Bronx cases generated by NYC’s Health and Hospital Corporation’s hospitals.  If a malpractice victim feels the offer is unfair or unrealistic, he or she can always opt out, and commence a standard medical malpractice case.  The program is being funded by a $2.9 million dollar grand from the U.S. Dept. of Health and Human Services, and is part of a nationwide pilot program.

Interestingly, not all shortages of physicians in particular fields can be blamed on high premiums and greater exposure to the threat of lawsuits.  There is a shortage of primary care physicians in this country, and according to the LA Times, it stems from the desire of medical school graduates to pursue more lucrative specialty areas.

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Yesterday, I gave a presentation to a roomful of medical records adminstrators at a conference put on by Lorman.  The topic was Medical Records Law in New York, and I spoke about handling requests for records, via HIPAA-compliant authorizations, subpoenas, and otherwise.

As I prepared for my talk, I thought back to the barely fathomable amounts of time and money that are wasted on the simplest of tasks:  obtaining medical records in the lawsuit context.  Here are the highlights of my rant on the topic:

The Costs of Not Providing a Timely Response When Records Are Requested.

 Know what really created the “medical malpractice crisis” in this country?

 Doctors’ failure to turn over records when asked!

Watch how this works….

 A plaintff’s lawyer requests records.  Many of you, and the doctors you work with, cringe.  You think…”They’re suing a Dr.???  They can wait!”

 And so it takes 10 “reminder” letters to your office before the records are sent.  Never mind that the sooner the plaintiff’s lawyer gets the records, the sooner he becomes fully educated about the merits of his case, not least because his experts get to review them sooner.  This may cause him to discontinue against the doctor.  It may also bring about an early & reasonable settlement demand.

 This, in turn, may mean less litigation costs for the insurance company, and less heartache for the doctor. 

But the truth is, requesting records when you’re defending these cases does not improve your chances of a timely response.  I know. I’ve been there.

It would take me, when I defended medical malpractice cases,  up to 10 letters also.  Know how much each of those “reminder” letters cost?  Think of it this way.

A defense lawyer bills the doctor’s medical malpractice insurance company  for every task he/she does, usually in increments of 6 minutes.

 The more time they bill for a given task, the happier their managing partner becomes. 

The defense lawyer managing the case on a day-to-day basis has to mark his calendar, every month:  “Check on Dr. Smith’s records.”

 He’ll have to go to the file room, find the file, bring it to his office, locate the medical records section, go through it carefully, making sure, for instance, that Dr. Smith’s records did not come to the file under a different name, say, that of his PC, South Shore Spinal Surgeons.

 He’ll see it hasn’t come in, so now, he has to write a letter, and make a phone call to your office.  And, he’ll diary it again for 4 weeks later to see if the 30 minutes worth of time he just charged the insurance company has paid off.  That’s about $100 at many firms.

 Now, imagine that the same defense lawyer has 15-20 other medical providers that he needs records from, on the very same case.  It’s the same time-sucking, bill-generating process.

And, it just drags things out. How?

 The first big event in the litigation of the case—plaintiff’s deposition—can’t go forward.  Why?   Under most circumstances, the plaintiff, like any other witness, is presented ONCE for deposition.  No competent defense attorney is going to want to attend plaintiff’s deposition without knowing everything possible about plaintiff’s past medical history, the care at issue in the case, and the care plaintiff needs now as a result of the alleged negligence.

And of course, dragging out the litigation means more day-to-day litigation expenses for the insurance company bankrolling all of this.

And now, back to today’s post…

And so, here is what I recommend to the medical liability insurance companies.  Penalize those of your insureds who fail to provide timely responses to requests for medical records.  Make it a condition of coverage that the healthcare provider sends out a response the FIRST time he/she/it receives a properly formed request.  If that’s too harsh, impose financial penalties on the providers for each instance of ignoring a legitimate records request.  Don’t rely only on the billing records you get from the partners at the defense law firms.  Actually go to the firms periodically, and leaf through the correspondence files to see how many times the same letter has been written.   Actions such as these will go a long way toward cutting the costs of medical malpractice litigation.

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While conservatives, and the GOP in general, continue to clamor for tort “reform,” the reality is that medical malpractice payments are not only not “out of control”–they are at their lowest level since 1992, according to an analysis by Public Citizen.

So it was surprising, to say the least, that a long-time liberal and former Clinton White House lawyer would speak out in favor of tort “reform.”  Yet, as Ashby Jones, of the WSJ Law Blog  wrote, that is exactly what Lanny Davis has done.  But interestingly, Jones’ telephone interview with Davis reveals something disturbing.  For a lawyer of his sterling status (current partner at McDermott, Will & Emery), he is out of touch with the day-to-day business of personal injury law and its subset, medical malpractice.

He starts out fine, speaking of the competing interests of providing for victims of medical malpractice, on the one hand, and taking care of the doctors, who, in his opinion have been forced to practice “defensive medicine,” and are close to being “push[ed] over a precipice.” 

After briefly touching on the jury’s role in determining non-economic damages, he advised that “[t]he problem in the system comes when you move beyond compensatory damages and into the realm of punitive damages…to deter bad behavior…How do we know that an out-of-whack penalty is going to deter the next doctor from being negligent?”

Well, speaking of being “out-of-whack,” Mr. Davis might be interested to know that punitive damages are rarely, if ever, awarded in medical malpractice cases.  It happens “only where the actions of the alleged tortfeasor constitute gross recklessness or intentional, wanton or malicious conduct aimed at the public generally or activated by evil or reprehensible motives.” Matter of Gravitt v. Newman, 114 A.D. 2d 1000 (2d Dept. 1985).  I think we can all agree, and I include non-lawyers here, that this type of conduct is not seen in the usual medical malpractice case.  And therefore, when Mr. Davis refers to such damages as being “the problem,” he immediately and permanently loses credibility.  “The problem,” instead, is that people like Mr. Davis feel free to speak on issues about which they are not knowledgeable.

He goes on to make certain that we know, and won’t forget, the extent to which he is a dilletante in this arena.  He “really believe[s] that some plaintiffs’ lawyers misuse the courts with frivolous lawsuits…There’s no cost to filing a frivolous lawsuit. And there’s no reason not to do it.  The bogus lawsuits that [he's] seen–the false claims cases, the securities fraud cases…[have] proven to be enormously lucrative…you can get a settlement and retire forever.”

Really?  And here I thought we were talking about medical malpractice lawsuits.  But, no need to stay on subject.  And as everyone knows, any lawyer can file a “bogus” case, and hit the jackpot, because the insurance company and its lawyers will not scrutinize the claim, will not conduct discovery, and will definitely not try the case.  No, according to Mr. Davis, the insurance company will simply throw money at you.   And naturally, all of that money the trial lawyers get from such bogus claims is pure profit, because when things are as Mr. Davis says they are, there is no need to invest tens of thousands of dollars of the trial lawyer’s money into obtaining roomfuls of medical records, conducting days of depositions, and retaining sometimes multiple expert medical witnesses.

I, for one, am certainly glad that Mr. Davis took time to weigh in on tort “reform,” because it reaffirms what most of us in the trenches know quite well.  Tort “reformers” are generally out of touch with the type of law involved and the realities of day-to-day practice, and have no appreciation for what it’s like to be the victim of medical negligence.

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You know, doctors don’t like to admit it, but even they turn to us trial lawyers now and then, as they have this week in California.  The reason? The Governator, a/k/a Arnold Schwarzenegger, exempted state hospitals from the requirement that an anesthesiologist be present when a nurse anesthetist administers anesthesia to a patient, without consulting the state’s medical board and board of nursing.  Pursuant to Medicare rules, he was requirerd to do so.

California’s medical societies have spun this as a patient safety issue, i.e., the supervision of an actual doctor prevents mistakes and injuries, and can better correct them if and when they occur.  But it is hard to ignore the fact that if doctors must be present in every case in which a trained, certified nurse anesthetist administers anesthesia, those doctors are going to make more money.

So who did the doctors call when they felt that their rights were being stomped on?  That’s right. Trial lawyers.  With their help, they have filed suit against Gov. Schwarzenegger.  Which is a little odd, since most of the time, when doctors or their medical societies use “trial lawyer” in a sentence, it is coupled with words like “greedy,” “evil,”  “opportunisitic,” and the like.

Of course, the reality is that trial lawyers may have saved your life, particularly if you were lusting after that cute little Ford Pinto some years back.  And even now, if you think Toyota is taking the action it is with regard to accelerator pedals on its own, you are probably in another galaxy.  It was trial lawyers, and the legitimate threat of lawsuits that would cost the company big money that was the ultimate motivator.

Perhaps if people had a natural tendency to take action to right wrongs they become aware of, we would not need us trial lawyers.  But history teaches us otherwise.  In yesterday’s NY Times, we learned some good news: that radiologists were finally taking the dangers of radiation therapy seriously by forming a safety task force and a central data base of errors that harmed patients.  But the disappointing news was this.  Such a step would never have been taken if the NY Times had not written two recent articles on the dangers of such therapy, and the lack of any safety systems that might help regulate such treatment.  You don’t think the radiologists envisioned a law suit or two, do you?

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There’s been a lot of public hand wringing by the GOP’s best spin doctors about those “runaway medical malpractice verdicts,” and their deleterious effects on the cost of healthcare, all done in the name of limiting victims’ rights to fair compensation, and helping doctors and hospitals avoid accountability for their errors.

In GOP World, the answer to the problem of “jackpot justice” –surely you’ve seen all those severely injured plaintiffs who have won law suits riding around in specially-outfitted Rolls Royces–is to impose caps on medical malpractice awards given by juries.  This would inject some much needed common sense into our broken jury trial system, and let doctors get back to the business of helping people, so the rhetoric goes.

And if you are not a lawyer, you might have given a second thought to such histrionics.  But if you are a lawyer, and particularly a New York State lawyer, you know that the tort “reformers” have neglected to fill the rest of the public in on a little secret.  Are you ready for it?  Good.  There is already an effective tool in place in our court system that limits outrageous jury awards, and it works both ways:  lowering the award when it is exessive; and increasing it when it is too paltry.  That tool is actually twofold.  It consists of the common sense of our appellate judiciary, as well as precedents set with regard to the exact issue of compensation.

After any verdict in New York State, any party can move for a reduction, or an increase in the amount of the verdict, based on what is reasonable compensation under all the circumstances.  In Ross v. Mandeville , 45 A.D.3d 755 (2d Dept. 2007), an OB/GYN allowed a medical student to make the incision enabling a C-section to be performed. The student ended up lacerating the forehead of the as-yet-undelivered baby, causing minimal, but permanent scarring.  When the trial jury awarded $200,000 for the infant’s past pain and suffering, and $350,000 for future pain and suffering, the defense moved to set aside the verdict as excessive.  The Appellate Division agreed with the defendant, and reduced past pain and suffering to $45,000, and future pain and suffering to $80,000.  It found that the initial damages deviated from “reasonable compensation.”  And they did so by looking to comparative values–that is, what other courts had awarded under similar circumstances.

So much for “runaway verdicts.” And so much for the urgent call for caps on medical malpractice damages, at least here in New York.

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