Medical Malpractice Reforms

This is the next of a series of columns on how the law can impact your life. Each month we will focus on various aspects of the law relating to personal injuries, those that happen both on-the-job and otherwise, including mishaps which occur in driving vehicles, using products and receiving medical care. The column will also respond to legal questions relating to personal injury that are sent to us.

Healy Scanlon Law Firm is comprised of eight trial attorneys, two of whom are from Ireland. We are located downtown at 111 West Washington Street, Suite 1425, Chicago, Illinois 60602 (800-787-5431 or 312-324-0409). www.HealyLawFirm.com. The firm concentrates in the representation of injured victims of all types of accidents.

Readers are encouraged to call or write with questions concerning personal injury law.

THE FACTS BEHIND MEDICAL MALPRACTICE "REFORM"

Last month, we discussed the decision of the Supreme Court of Illinois invalidating caps on non-economic damage awards in medical malpractice cases. The Court's decision, the third time it has found damage caps unconstitutional, noted that a jury must decide the amount of damages on a case-by-case basis, and that the trial judge who hears the case must decide on a case-by- case basis if a verdict is excessive.

Some have criticized the Court's decision using the same arguments that were used to induce the legislature to pass damage caps in 2005. In this article, we will discuss these arguments and look at the statistics behind the arguments. Many of the statistics discussed below were cited by a group of about 25 law and social sciences professors from colleges across the country who filed a "friend of the court" brief in the Supreme Court opposing the caps.

Doctors are not leaving Illinois

One of the principal arguments in support of capping medical malpractice cases is that there is a "doctor flight" or "doctor exodus" from Illinois. Statistical data actually shows that Illinois has been gaining doctors and has never seen a decrease in licensed doctors in the over 40 years since the American Medical Association began keeping such data. Even after the Supreme Court struck down caps in 1976 and 1995 there was no "doctor flight" from Illinois. Instead, the number of doctors increased.

Significantly, Illinois has a higher rate of physicians per 100,000 residents than nine of its neighboring states, each of which cap malpractice awards.

Neither the number of Medical Malpractice cases nor the amount of Medical Malpractice Verdicts are Rising

Advocates of the cap also argue that the number of medical malpractice suits filed and the amount paid to resolve malpractice cases have been on the rise. Contrary to these assertions, available data shows that in 2003, two years before caps were imposed, the average jury award in medical malpractice cases tried in Cook County dropped to a three-year low. From 1999 to 2003, the number of Cook County claims paid by ISMIE, the state's largest malpractice insurer, dropped from 220 to 160.

In Illinois' southern Madison County, touted by cap advocates as a "judicial hellhole," there were only 11 medical malpractice verdicts from 1996 to 2003. Only 4 verdicts were in favor of the plaintiff and only 1 of those verdicts exceeded $1,000,000, awarding $1.8 million.

After the caps were imposed, ISMIE was called upon to support its claim that the number of malpractice claims was on the rise. The reason for the alleged increase in claims turned out to be caused by the way the insurance companies chose to report claims: prior to 2003, if one lawsuit was filed against an insured doctor and an insured clinic it was reported as one claim. After 2003, the same scenario was reported as two claims. Why did insurance companies change their reporting methods? Apparently they wanted everyone to incorrectly conclude that lawsuits were increasing.

ISMIE also increased its claims reporting by including other "incidents" such as when a doctor's medical records are subpoenaed, a doctor is subpoenaed to give a deposition, and when a doctor self-reports a medical error even though no lawsuit is ever filed. In 2006, the Illinois Director of Insurance ordered ISMIE to cease categorizing such contacts as claims.

ISMIE executives also admitted to the Director of Insurance that they had no data to support their claims that the amount of claim payments was increasing. Instead, the data demonstrates that the average claim payment peaked in 2003 and has leveled off ever since. In fact, the average claim payment, when it increases at all, increases below the rate of medical inflation. In 2004, the year before caps were imposed, claims payment was lower than both 2003 and 2002.

Medical Malpractice claims do not greatly increase the cost of healthcare

Many are concerned that medical malpractice claims, and the cost of "defensive medicine" to avoid such claims, can cause an increase in the cost of healthcare overall. However, the Congressional Budget Office (CBO) found in 2004 and again in 2008 that reducing medical malpractice insurance premiums would have little, if any, effect on healthcare spending. In 2008, the CBO characterized the effect as less than half a percent.

Turning to the concern over "defensive medicine," the CBO found that any evidence that "defensive medicine" increases the cost of healthcare is "weak or inconclusive" and "at best ambiguous."

The CBO's findings were further confirmed by the fact that malpractice insurance rates for physicians in states with malpractice caps were virtually the same as for physicians in states without caps.

Medical Malpractice cases are already subject to significant legislative protection

Often absent from the debate surrounding medical malpractice caps is that in Illinois, medical malpractice cases are already subject to significant legislative restrictions. For instance, fees charged by a plaintiff's attorney are restricted to certain maximums unless a court allows for more. Fees charged by defense attorneys representing a doctor or hospital are not limited by statute or by courts.

Punitive damages, damages which are awarded when an individual's or corporation's conduct is more than just negligent, but is willful and wanton, are not allowed in any medical malpractice claim under any circumstances. Finally, in order to even file a medical malpractice lawsuit, an injured plaintiff must attach a report by a physician who has reviewed the allegations and found that they have merit. All of these provisions have existed in Illinois for some time, and have been found constitutional.

Georgia acts on its damage cap

It is interesting to note that while writing this article the Supreme Court of Georgia considered that state's cap on non-economic damages. That Court, like the Illinois Supreme Court, found that the determination of damages rests "peculiarly within the province of the jury. The right to a jury trial includes the right to have a jury determine the amount of damages to be awarded to Plaintiff." Georgia, like Illinois, found the caps unconstitutional.

Conclusion

When the arguments advanced by damage cap advocates are analyzed with the actual statistical data, it is clear that the data does not support the arguments. Medical malpractice cases already have unique restrictions and limitations unlike any other personal injury lawsuit. Finally, medical malpractice damage caps, even if found constitutional, would not result in any significant lowering of the cost of medicine. In a future article, we will address insurance industry reforms that can help to reduce medical malpractice premiums for doctors.

By: Martin Healy, Jr.
Dennis M. Lynch