The Malpractice Problem

(Weekly Standard)  Stanley Goldfarb, MD, is associate dean of clinical education at the University of Pennsylvania School of Medicine and a nephrologist.

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The extra imaging study, the extra day in hospital at the end of an admission, the repetitive laboratory testing, the admission to the hospital to be "sure" about the diagnosis are all inherent in the culture of American medical care. The avoidance of litigation has become ingrained into all aspects of medical care. Since physicians are not liable for the increased costs of care but are liable for any error or missed diagnosis, it would be foolish for them to act in any other fashion. The costs of this mindset cannot be easily assessed by surveys.

No one can identify how the current health care bills being debated and apparently continuously modified in Congress will reduce the cost of health care. They may produce a reduction in insurance premiums for some, but just paying less for health care does not magically produce a diminution in the actual cost of health care. The latter would only occur if there were large profits in the overall health care enterprise that could be trimmed without changing the basic character of the system. But no one has identified such profits. The president points to for-profit insurance companies, but for-profit insurance companies only make up 25 percent of the system and they are not that profitable, ranking 85th among all U.S. industries. "Reform" will redistribute the money, not reduce the overall cost. This is pretty much what the American Health Insurance Plans study, so denigrated by the president, concluded. Unless the costs of health care fall, lowering insurance payments in one segment of the populace will inevitably cause an increase for some other group.

There is much that can be done to make our system more efficient. Tort reform is a great place to start. Medical errors are common and fairness demands that compensation be paid when someone is injured. However, the price for the current system is enormous. The view from the left is that the direct costs of the current malpractice system -- the actual payout of dollars in lawsuits -- are pretty minimal compared to overall health care spending. The indirect costs, the use of tests and procedures to avoid lawsuits, are also said to be overstated in studies, as those who answer surveys about this issue are assumed to be biased. The view from the right is precisely the opposite and ascribes an important component of health care spending to malpractice costs. This view also blames the lawyers.

The experience in Texas, where there is a law capping payments for pain and suffering to $250,000, suggests some benefit. For example, as reported in the Wall Street Journal, malpractice suits have been dramatically reduced. The year before the caps on pain and suffering payments took effect, there were over 1,100 medical liability suits filed in Dallas. Only 142 cases were filed in 2004. In addition, there was a surge of physicians entering Texas to set up practice as malpractice premiums fell by about 50 percent. Texas also is actually a state with low health care spending. According to the National Center for Policy Analysis, although Texas is fifth highest in Medicare spending per capita, it is 43rd in per capita spending for the state's entire population. Whether the malpractice caps in Texas account in any way for these data is uncertain but the pattern is encouraging.

The problem for physicians is not only about the money expended in malpractice insurance premiums or about excess payouts to plaintiffs. It is also about the time and effort that defending against lawsuits requires. It is also about the potential for a trial and the stress associated with the experience. Avoiding these legal troubles is as much an influence on doctors as the desire to avoid a potential increase in insurance premiums following a malpractice suit.

New approaches that do more than simply reduce the direct payouts for patient injury and for insurance premiums are needed. Medical courts where experts decide the legitimacy of a lawsuit and assign responsibility for any errors are worthy of careful study as a potential answer to the problem along with control of malpractice premiums and payouts for pain and suffering. The current malpractice system has contributed to an overall health care system that is inefficient. The large awards to a few have contributed to the unsustainable costs for many. This should not persist. Cutting the cost of health care will require a real reduction in the costs associated with delivering care, not just the cost of health insurance premiums.


By Stanley Goldfarb:
Reprinted with permission from The Weekly Standard

[mcapek]

Anybody who is actually working in healthcare knows that countless billions are wasted in lawsuit prevention. People who quote here only 1% or 1.5% costs are either delusional or employees of Trial Lawyers of America. And if there are lot of incompetent and corrupt doctors, how come you don't make a stink about VA doctors, who as a group are clearly second rate, and yet cannot be sued (protected by the government)? My God, those poor suffering veterans!!!

Americans want it all ways, perfect care by perfect people, 100% of the time, somebody else should pay my heathcare bills, and I want the right to sue for millions for pain and suffering or anything that may go possibly wrong during my disease. That is a ridiculous and financially unsustainable demand!

[ChristopherMD]

I am a physician and this makes me so mad I can not stand it. This bill is beyond insulting. No tort reform any where in 1990 pages. Not a single one of my colleagues agrees with any of this madness. Make no mistake, we will be heard in the polling booths. Each and every one of those voting for this mess will be held accountable. So will the AMA for endorsing this.

[doc_holliday76]

Healthcare system wastes up to $800 billion a year

"The good news is that by attacking waste we can reduce healthcare costs without adversely affecting the quality of care or access to care."
One example -- a paper-based system that discourages sharing of medical records accounts for 6 percent of annual overspending.
"It is waste when caregivers duplicate tests because results recorded in a patient's record with one provider are not available to another or when medical staff provides inappropriate treatment because relevant history of previous treatment cannot be accessed," the report reads.
Some other findings in the report from Thomson Reuters, the parent company of Reuters:
* Unnecessary care such as the overuse of antibiotics and lab tests to protect against malpractice exposure makes up 37 percent of healthcare waste or $200 to $300 billion a year.
* Fraud makes up 22 percent of healthcare waste, or up to $200 billion a year in fraudulent Medicare claims, kickbacks for referrals for unnecessary services and other scams.
* Administrative inefficiency and redundant paperwork account for 18 percent of healthcare waste.
* Medical mistakes account for $50 billion to $100 billion in unnecessary spending each year, or 11 percent of the total.
* Preventable conditions such as uncontrolled diabetes cost $30 billion to $50 billion a year.
"The average U.S. hospital spends one-quarter of its budget on billing and administration, nearly twice the average in Canada," reads the report, citing dozens of other research papers
"American physicians spend nearly eight hours per week on paperwork and employ 1.66 clerical workers per doctor, far more than in Canada," it says, quoting a 2003 New England Journal of Medicine paper by Harvard University researcher Dr. Steffie Woolhandler.
Yet primary care doctors are lacking, forcing wasteful use of emergency rooms, for instance, the report reads.

All this could help explain why Americans spend more per capita and the highest percentage of GDP on healthcare than any other OECD country, yet has an unhealthier population with more diabetes, obesity and heart disease and higher rates of neonatal deaths than other developed nations.

[miss_diagnosis]

So let's assume that tort reform has really lowered doctors' malpractice premiums and brought more doctors to Texas - a specious claim at best. What has it done for us, the patients? It hasn't lowered our health-care costs, hasn't lowered our health insurance premiums, and thousands of patients continue to die annually due to preventable errors, except now doctors don't have to worry about getting sued most of the time. The only thing that tort reform has done for the good people of Texas is to ensure that they won't get to see the inside of a courtroom if they become victims of medical malpractice. Tort reform's a great deal for doctors and insurance companies, but it's a raw deal for patients and their families.

[cin313]

I am a physician and I live in fear of a lawsuit all the time. I admit to practicing defensive medicine at times. Patients will blatantly say "If anything happens to me I will sue you." I have absolutely NO financial incentive to order tests. None. I do not get one dime for doing labs, x-rays, stress tests, CT scans, etc. We do not own a lab or X-ray facility, it is owned by the hospital, so I don't make ANY money whatsoever by doing tests. Only physicians who own their own lab or X-ray facilities can be accused of having financial incentive to do tests. Hospitals may charge a lot for the tests, but it's not the hospital administrators ordering the tests, it's the doctors, and there's nothing in it financially for them. People who say that defensive medicine doesn't exist clearly do not work in the medical field.

[sjc_1]

It may exist, but if the doctor wants to practice at a hospital then know the pressures to increase revenue as much as anyone else. The courts will throw out legal actions with no merit. It is about time that the AMA did something about bad doctors that cause problems. Instead those doctors just go to another state and continue causing problems.

[us_1776]

With the greedy private healthcare insurance companies finding more ways to deny coverage, reduce coverage, exlude coverage, or avoiding coverage altogether, it's no wonder that there are so many huge problems with the healthcare system. One of the side-effects has been that there is a huge amount of cost-shifting that goes on. Another is that patients routinely lie to doctors because they don't want a diagnosis which might be used against them by their insurance company. And doctors too knowing that a certain diagnosis might present problems for a patient may word a diagnosis in different terms than they would under a normal system. The whole system is a complete mess and needs to be reformed so that people can tell the truth to their doctors. Their doctors can tell the truth to the patient and the insurance companies. And that costs can be clearly identified as to where they are incurred.

[sjc_1]

Tort reform is a misnomer, that would mean all torts for harm from doctors to car crashes, so it would be best to call if malpractice litigation reform. Malpractice insurance premiums are 1% of health care costs. Malpractice court awards are 1/5 of 1% of health care costs. You do the math, but you come up with one huge profit for malpractice insurance companies. You hear about "defensive medicine" but at 1%, that is not really likely. What is more likely is that hospitals charge a lot for tests so the more tests you do, the more money you make.

[huegorgan]

Check out the 7th amendment to the Constitution. It is our God-given right as Americans to sue. Our fore fathers were a smart group of dudes!

Tort reform is akin to an assault on our automatic assault weapons. Where are the gun nuts on this one? Oh, that's right, they think there is only one amendment to the Constitution.

Insurance premiums will continue to rise regardless of litigation. It is the myth that allows the health care industry, from docs to LPNs and insurance companies to pharmaceuticals, to charge the outlandish prices they charge.

[kenhamlett]

Tort Reform is specifically to protect the incompetent and corrupt. The current malpractice insurance allows people to practice which would otherwise be out of business for good cause. If the incompetent would stop practicing then the insurance costs would be reduced for those worthy of continuing with the trade. Tort reform short circuits this by placing the penalty on the victimized consumer instead of the wrong doing practitioner and his insurance company.
Our medical system is pathetic. We do not need the incompetent but by legislation the government protects their butchery. That is the way it really is.

[jt92202]

Sorry grammer, typing too fast. Should say:

I am glad they are looking at all reasons for why the costs are so high.