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Medical Liability Reform Crisis 2008

  • Symposium: Clinical Risk and Judicial Reasoning
  • Published:
Clinical Orthopaedics and Related Research

Abstract

The crisis of medical liability has resulted in drastic increases in insurance premiums and reduced access for patients to specialty care, particularly in areas such as obstetrics/gynecology, neurosurgery, and orthopaedic surgery. The current liability environment neither effectively compensates persons injured from medical negligence nor encourages addressing system errors to improve patient safety. The author reviews trends across the nation and reports on the efforts of an organization called “Doctors for Medical Liability Reform” to educate the public and lawmakers on the need for solutions to the chaotic process of adjudicating medical malpractice claims in the United States.

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Authors and Affiliations

  1. Department of Orthopaedics and Rehabilitation, University of Iowa Hospitals and Clinics, 200 Hawkins Drive, 01008 JPP, Iowa City, IA, 52242, USA

    Stuart L. Weinstein MD

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  1. Stuart L. Weinstein MD
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Correspondence to Stuart L. Weinstein MD.

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The author certifies that he has no commercial associations (eg, consultancies, stock ownership, equity interest, patent/licensing arrangements, etc) that might pose a conflict of interest in connection with the submitted article.

Appendices

Appendix 1

First published by Texas Medical Association (2008). Reprinted with permission. (Available at: http://www.texmed.org/Template.aspx?id=5238.)

Proposition 12 Produces Healthy Benefits

Improving access to medical care is critically important to all Texans

  • This is especially true for children, pregnant women, the aged, the poor, those in an emergent condition and those in rural Texas.

Charity care has greatly increased since the passage of the 2003 reforms

  • Charity care rendered by Texas hospitals rose 24% in the three years following the passage of Prop. 12. But for the 2003 reforms, this $594 million increase in charity care expenses would have left many Texas hospitals with the stark choice of turning away charity care patients or closing their doors altogether. The state’s non-profit hospitals saw their charity care costs increase 36% in this same time frame.

HB 4 (the 2003 medical liability reforms) has a track record of improving access to medical care

  • Texas licensed a record 3324 new doctors this year; 808 more than last year.

  • Since the passage of the 2003 reforms, the state has improved its national standing from 48th to 42nd in the American Medical Association’s measurement of patient-care doctors per capita.

  • The physician growth rate in El Paso is 76% greater than pre-reform.

  • The physician growth rate in San Antonio is 55% greater than pre-reform.

  • The physician growth rate in Houston is 36% greater than pre-reform.

After years of decline, the ranks of medical specialists are growing

  • After a net loss of 14 obstetricians from 2001 to 2003, Texas experienced a net gain of 186 obstetricians.

  • Texas experienced a net loss of nine orthopedic surgeons from 2000 to 2003. Since tort reform, the state experienced a net gain of 156 orthopedic surgeons.

  • Texas has experienced a net gain of 26 neurosurgeons since Prop 12, including one each in the medically underserved communities of Corpus Christi and Beaumont.

  • If the pending applicants are approved, the statewide total of pediatric intensive care, pediatric emergency medicine and pediatric infectious disease specialists will double.

Doctors are bringing critical specialties to underserved areas

  • Since the passage of reforms, the Rio Grande Valley has added 189 physicians. That represents a robust 16.6% increase in Cameron County and an even greater 17.9% increase in Hidalgo County; both growth rates exceeding the state average.

  • Jefferson, Nueces and Victoria counties saw a net loss of physicians in the eighteen months prior to tort reform. Currently, all three counties are producing impressive gains; adding much-needed specialists and emergency medicine physicians.

Hospitals are upgrading equipment, expanding their emergency rooms, launching patient safety programs and expanding their level of charity care

  • Monies have also been freed to expand outpatient services, improve salaries for nurses and increase payment to on-call physicians.

Premiums are stable and reduced

  • All major physician liability carriers in Texas have cut their rates since the passage of the reforms, most by double-digits. Texas physicians have seen their liability rates cut, on average, 24.3%. Two-thirds of Texas doctors have seen their rates slashed a quarter or more.

  • Seventeen rate cuts have occurred in Texas since the passage of the 2003 landmark reforms.

Reductions in premiums since the passage of Prop. 12 and respective savings:

  • Texas Medical Liability Trust: 31.3%, and $200 million in savings plus three renewal dividends totaling an additional $75 million.

  • APIE: 17.4%, and $14.8 million in savings

  • Medical Protective: 25.7%, and $12.6 million in savings

  • Joint Underwriting Association (JUA):10%, and $6 million in savings)

  • The Doctors Company, 25.3%, and $4.2 million in savings

  • Advocate MD: 29.5%, and $5.34 million in savings

Cumulative liability cost savings since January, 2004: $327.94 million.

  • Roughly half of the state’s doctors are now paying lower liability premiums than they were in 2001.

Competition in the Health Care Liability Market Increasing

Since the passage of Proposition 12, Texas has added:

  • Four new admitted, rate-regulated carriers: Advocate MD of the Southwest, Medical Liability Insurance Company of America, Medicus Insurance Company and the Physicians Insurance Company.

  • Twenty six risk retention groups, captives, surplus lines and other unregulated insurers.

  • Texas physicians can competitively shop their policies.

  • Thirteen percent of the commercial physician liability market is being insured by companies new to Texas since February 2003.

Claims and lawsuits in most Texas counties have been cut in half

Changing HB 4 will hurt access to medical care.

  • CHRISTUS Spohns’ Westside Corpus Christi clinic serving the indigent and its Diabetes Excellence Program are funded by the hospital’s medical liability savings. Take away the savings and the programs are jeopardized.

  • Driscoll Children’s Hospital in Corpus Christi used its liability savings to open satellite clinics in the border cities of Brownsville and McAllen. Take away the savings and the programs are jeopardized.

  • Kelsey-Seybold Clinic in Houston is using its liability savings to fund an electronic medical record. This electronic medical record will eliminate sources of medical error due to illegibility, monitor for medication allergies and alert the prescribing physician about drug interactions. It will also allows results to be graphed to show doctor and patient trends over time and will reduce the cost of health care through more efficient handling of medical information. This $20 million electronic medical record investment would not be possible without the savings achieved by medical liability reform. Kelsey-Seybold treats 1.1 million patient visits a year in the Houston area.

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Weinstein, S.L. Medical Liability Reform Crisis 2008. Clin Orthop Relat Res 467, 392–401 (2009). https://doi.org/10.1007/s11999-008-0603-y

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