America at Risk: The Crisis of Hope, Trust, and Caring

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The vast majority of awards against obstetricians involve poor outcomes at childbirth. As a result, payouts for poor infant outcomes account for the bulk of obstetricians' insurance costs.

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It is not surprising that expectant mothers are finding their doctors have left states that support litigation systems imposing these costs. In addition to premium increases for physicians, nursing home malpractice costs are rising rapidly because of dramatic increases in both the number of lawsuits and the size of awards. Nursing homes are a new target of the litigation system.

From to , the average size of claims tripled, and the number of claims increased from 3. These costs vary widely across states, again in relation to whether a state has implemented reforms that improve the predictability of the legal system.

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Demonstrating and exacerbating the problem, several major carriers have stopped selling malpractice insurance. Doctors Insurance Reciprocal stopped writing group specialty coverage at the beginning States that had not enacted meaningful reforms such as Nevada, Georgia, Oregon, Mississippi, Ohio, Pennsylvania, and Washington were particularly affected.

The insurance crisis is less acute in states that have reformed their litigation systems. As Table 6 below shows, there is a substantial difference in the level of medical malpractice premiums in states with meaningful caps, such as California, Wisconsin, Montana, Utah and Hawaii, and states without meaningful caps.


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In the early s, California faced an access crisis like that facing many states now and threatening others. With bi-partisan support, including leadership from then Governor Jerry Brown and now Congressman Henry Waxman, then chairman of the Assembly's Select Committee on Medical Malpractice, California enacted comprehensive changes to make its medical liability system more predictable and rational.

Shortening the time in which lawsuits could be brought to three years thus ensuring that memories would still be fresh and providing some assurance to doctors that they would not be sued years after an event that they may well have forgotten. Providing for periodic payment of damages to ensure the money is available to the patient in the future. California has more than 25 years of experience with this reform. It has been a success. Doctors are not leaving California.

Insurance premiums have risen much more slowly than in the rest of the country without any effect on the quality of care received by residents of California. Federal and state action is needed to address the impact of the medical liability crisis on health care costs and the quality of care. As years of experience in many states have proven, reasonable limits on the amount of non-economic damages that are awarded significantly restrain increases in the cost of malpractice premiums.

These reforms improve the predictability of the medical liability system, reducing incentives for filing frivolous suits and for prolonged litigation. Greater predictability and more timely resolution of cases means patients who are injured can get fair compensation more quickly. They also reduce health care costs, enabling Americans to get more from their health care spending and enabling federal health programs to provide more relief. They improve access to care, by making insurance more affordable and available.

The President supports federal reforms in medical liability law that would implement these proven steps for improving our health care system:. Provide for payment of a judgment over time rather than in one lump sum--and thus ensure that the money is there for the injured patient when needed. Informing the jury if a plaintiff also has another source of payment for the injury, such as health insurance. Provide that defendants pay any judgment in proportion to their fault, not on the basis of how deep their pockets are.

Legislation such as H. Enactment of this legislation with improvements to ensure that its meaningful standards will apply nationally, will be a significant step toward the goals of affordable, high-quality health care for all Americans, and a fair and predictable liability system for compensating injured patients. In addition, there are other promising approaches for compensating patients injured by negligence fairly and without requiring them to go through full- scale, time-consuming, and expensive litigation.

Just as states like California have demonstrated the effectiveness of litigation reforms, they should also adopt and evaluate the impact of alternatives to litigation. Early Offers is one innovative approach.


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  4. It would make it possible for injured patients to receive fair compensation quickly, and over time if any further losses are incurred, without having to enter into the litigation fray. Because doctors and hospitals would have an incentive to discover adverse events quickly in order to make a qualifying offer, it would lead to prompt identification of quality problems. The money that otherwise would be spent in conducting litigation would be recycled so that more patients get additional recovery, more quickly, with savings left over to the benefit of all Americans.

    It may also be possible to implement an administrative form of Early Offers as an option for care provided under federal health programs. A second innovative approach involves strengthening medical review boards.

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    An American Crisis: Who Will Care for the Baby Boomers? | Time

    Boards with special expertise in the technical intricacies of health care can streamline the fact-gathering and hearing process, make decisions more accurately, and provide compensation more quickly and predictably than the current litigation process. As with Early Offers, incentives are necessary for patients and health care providers to submit cases to the boards and to accept their decisions. The Administration intends to work with states on developing and implementing these alternatives to litigation, so that injured patients can be fairly compensated quickly and without the trauma and expense that litigation entails.

    The best protection for patients can be provided by medical professionals, not lawyers. High quality care that achieves the best possible patient outcomes makes litigation unnecessary. The Administration is already taking many steps to improve quality of care. The ability of Americans to work with their doctors to choose and control their own health care is an important ingredient of quality.

    The people who are most affected by the quality of care--patients and their families--should be the ones deciding how they obtain their health care. To do so, they need helpful information. The Administration is undertaking a number of activities to promote quality by increasing and improving the information available to patients, and taking other steps to make the system safer and better. Some specific activities include:. Providing quality information about nursing homes on the Internet to enable families to make comparisons and informed judgments.

    Promoting the introduction and use of bar coding for dispensing prescription drugs to reduce errors. Examining model disease management programs that can improve the quality of care for people with asthma and diabetes. Developing computer software that hospitals can use to identify quality problems, assisting in quality improvement activities. The Administration will work to expand these efforts, to give patients and their doctors the information they need to make informed and appropriate medical decisions, while protecting the confidentiality of sensitive information from inappropriate uses.

    We must do a better job of helping them and other experts to identify problems before they result in injury and to develop better ways of providing care.

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    Researchers have found that most errors are system failures, rather than individual faults. Doctors could do their job correctly, and most errors would still occur. Continuous quality improvement processes, which have been effective in many other "high-risk" sectors, focus on finding ways to design work processes so that better results and fewer errors can be achieved. This requires measurement and analysis of the ways health care is provided, and the results of care for patients. By encouraging the experts to work both inside their own organization and with outside groups to share information on how medical errors or "near misses" occur and ways to prevent them, health care organizations have begun to develop tools to prevent injury and increase knowledge of how errors occur.

    Success in improving health care practices to prevent errors and deliver high-quality care, however, requires a legal environment that encourages health care professionals and organizations to work together to identify problems in providing care, evaluate the causes, and use that information to improve care for all patients. A principal obstacle to taking these steps is the fear by doctors, hospitals, and nurses that reports on adverse events and efforts to improve care will be subject to discovery in lawsuits. A number of states have enacted peer review statutes that protect the confidentiality of information reported to hospitals and other health care entities.

    States that have such laws have found that they improve reporting of adverse events, thereby facilitating efforts to identify problems and improve quality. These protections do not take away from the ability of plaintiffs to succeed in lawsuits: all of the medical information currently available to pursue a lawsuit is still available. Confidentiality protections provided by law for specific activities also have proven successful in identifying problems and reducing medical errors:. The National Nosocomial Infections Surveillance System, operated by the Centers for Disease Control, receives voluntary reports from hospitals on hospital-acquired infections.

    The system works because federal law assures participating hospitals that information supplied by them will be kept confidential. Adverse events concerning medical devices and drugs may be reported to it to identify problem areas. Names of the reporting doctors and hospitals, and the name of patients involved, are not releasable under the Federal Freedom of Information Act.

    To encourage reporting, federal law provides that reports relating to new safety ideas, close calls, or unexpected serious injury are confidential and privileged. This is based on the successful system operated by the National Aeronautics and Space Administration for aviation safety reporting. Adverse events are reported to it.

    For example, these laws typically apply only to a single institution and do not reflect the systemic nature of health care as it is now provided. They do not provide a way to obtain data from various providers at one time and to compare results.

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    Many states, moreover, do not have any peer review statutes at all. The IOM, therefore, recommended legislation to ensure that peer review proceedings and reports remain confidential.


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    The President believes that new, good-faith efforts to improve the quality and safety of health care should be protected and encouraged, not penalized by new lawsuits. In his speech in Milwaukee on February 11, President Bush urged Congress to do something about this problem by enacting legislation that will give health professionals the confidence necessary to expand their reporting of problems in the health care system. Following the President's request, and with assistance from the Administration, legislation was introduced in both Houses of Congress that would provide protection from discovery in lawsuits for reports made to Patient Safety Organizations and for their collaborative efforts to improve care.

    Chairwoman Johnson and others have introduced a similar Bill in the House H. Enactment of this legislation will ensure that patient safety and quality reports are given the protection they deserve. Information developed or used as part of Patient Safety Organizations' activities would be protected, and would not be available for trial lawyers to exploit in order to find new opportunities for litigation.

    The assurance of confidentiality is a proven approach to increase reporting by doctors, nurses, and other health care providers.