Captain's Quarters -

Inflation accounts for a good bit of that, apparently. with most of the total dollar increase coming from the increased number of awards in that period..

According to the Inflation Calculator at http://www.westegg.com/inflation/infl.cgi , $163192 in 1991 becomes $242797 by 2006 - only an eleven percent rise per case - less than one percent per year per lawsuit.

Rather than focusing on the size of the awards, you may want to look into the issue of settlements. In the past, most med-mal cases were settled prior to trial, but with the various Medical Associations, etc. pushing to decline settlements, more cases are actually going to trial, raising the award total, but demonstrating a substantially lower percentage of cases won by plaintiffs.
In short, it's hard to win a case, but when a plaintiff DOES win, the award is often enormous.

Ed, you really should distinguish between economic damages (medical bills and lost income) and non-economic damages (pain & suffering, etc.). Not doing so renders the data meaningless.

California and many other states, perhaps most, have capped non-economic damages in medical malpractice cases by statute for about twenty years.

This means that most of the increase in verdict size may well be caused by (GASP!) the incredible across-the-board increase in medical expenses for the period you are measuring. Hack, hack, hack. Reboot!

You might also see how much of the increase is due to neo-natal injuries during labor and delivery, relative to non-neo-natal injuries. Life-time care can be very, very expensive. And infants who would not have survived 20 years ago are surviving now and requiring expensive life-time care.

I wonder how many settlements occur, too, before proceedings reach the lawsuit stage and awards are decided upon.

It's really hard to know what these numbers really mean though without knowing more about the type of injury and the relative size of various awards against particular defendants.

I think that as medical care has become more sophisticated, the expectations have likewise grown and the liability has of course increased.

Obvious cases of malpractice (taking out the wrong kidney, etc.,) usually settle quickly. I suspect (but don't know) that insurers are more likely to take cases to trial that involve causation issues (what really caused the harm and was it preventable?), or that involve comparative negligence, where liability should be apportioned amongst various defendants and possibly a percentage to the plaintiff as well.

In a mega-claim scenario you may also have the reinsurers to deal with and that can complicate settlement.

In other words, the numbers really don't tell us anything.

Well, that explains Edwards' really big house.

It also would be interesting to know what type of numbers there were before 1991...
We keep hearing the excuse that costs are rising due to a surge of lawsuits, yet I haven't seen any data to back it up...

Good thread though... I like the way it's open for discussion instead of stating a point and having people argue it.

Settlements are a much larger portion of the John Edwards pie. I won't try to recall the percentage so as not to give further credence to the old adage that 43.55% of all statistics are made up on the spot....(like that one). The ABA tries to hide that figure when they show that Awards are a small percentage of all malpractice premium dollars paid, conveniently skirting the settlement amounts and defense costs, both inside and outside the coverage limits. Even harder to figure is the cost of "CYA" tests and procedures performed by physicians trying to, well, cover their asses.

I must admit that I thoroughly enjoyed making a Trial Lawyer Association visitor doing the PR tour to my Rotary Club squirm when I asked that question. He feigned ignorance of course, but the audience got the point...and peppered him with questions. He must have thought he was going to speak to the Garden Club, not the Rotary Club. Most of us are business owners or management, at least in my club anyway.

Score one for the Rotarians!! A trial lawyer could never pass the 4 Way Test.

It's a piece of the puzzle. We need some more pieces.

Take this data, add to it the cost of salaries and benefts for medical practitioners. Look at the cost of malpractice premiums. Look at the number of physicians leaving specialties (you can't find an OB/GYN in some counties anymore). Look at the number of people - not necessarily MDs entering specialties (radiologic / imaging techs) - look at the growth in and waiting lists for training programs in these areas. Look at the change in number of attorneys specializing in medical malpractice lawsuits.

When a puzzle piece is missing, you can often get a sense of the missing piece by looking at what you DO have. While there may be no hard, easy-to grasp data on the direct contribution of malpractice awards, we can use the data we do have to see the the size and shape of that missing puzzle piece.

What we need to find out is how the 'lawyers' find the juries without the brains to know that the insurance companies don't 'lose' anything. It comes right out of our own pockets. It doesn't make sense to approve the outlandish awards when you have to pay it yourself. I guess it makes them feel important when the news? puts the award numbers (dollars) out in public. Limit all damage suits to actual damages and the numbers will drop, lose the case and you pay the legal fees of the defendent will limit them to those with actual proven injuries.

What happens to the malpractice industry under Universal Care / Hillary Care? I don't think this part of the picture is being researched properly.

It's interesting.

skydaddy touched on my point -- wouldn't a graph of malpractice premiums be more relevant to the topic of escalating health care costs? Doctors and hospitals may be paying more for malpractice insurance either because they have an increased fear of litigation and want more coverage or because the insurers are charging more for the same old coverage.

For health care pros the number of payouts you're citing may be less important (and frightening) than the escalation in the dollar amounts. If I was a doctor I wouldn't want to risk losing my practice because someone found a sharp lawyer and a gullible jury.

Since 1975, medical malpractice costs have risen four times faster than consumer price inflation and twice as fast as medical price inflation.

Source: http://www.willisms.com/archives/2007/02/trivia_tidbit_o_415.html

One of the sources for economic information that I have come to trust is willisms. It provides readily understood graphs and accurate, objective data.

Willisms also has a good thread (Trivia 415) on how socialized medicine thwarts innovation, especially in pharmaceutical development.

The problem is that the NPDB does not include all malpractice payouts, and the proportion of non-responders has changed over time. There have already been numerous studies of the NPDB comparing them to various state legal regimes. But then there is the problem of measuring state legal regimes: do you measure it by when the law passes? By when the state supreme court upholds the law? Many studies distort results by counting states that do not have effective tort reform as states that have passed caps.

Very interesting, Captain. Perhaps if the medical society had done a better job policing its members, we wouldn't be here. On the other hand, the lawyers run the legislatures and have no interest in fixing the problem that feeds them.

In the end, it's a tax on medicine, paid by the same people who pay all the taxes.

I'm curious. When the government takes over the health care industry and all doctors and medical professionals work for the government, who are the ambulance chasers going to sue?

It has been said that the only malpractice crisis we have in America IS the malpractice that we have in America. According to the Harvard Medical School (not the law school, the MEDICAL school), over 100,000 people die each year due to malpractice and over a million are injured. Your chances of malpractice when admitted to a hospital is 1 in 3. It appears from your data that claims are significantly underreported. You also ought to look in to profits of malpractice insurance carriers over the time period. You will see their profits have skyrocketed, because they have justified huge rate increases by screaming "crisis." But, your data shows in fact that there is no crisis as the actual claims and dollar amounts have risen only slightly or been flat.

Please keep hammering away on this as it is a woefully misunderstood and manipulated subject. As that database shows, as well as anecdotal evidence, there has not been a mass exodus of doctors from certain states and from the profession because of a perceived spike in malpractice award and amounts.

That is not to say that there aren't problems. There are, and skydaddy is right that we need more pieces of the pie.

But in my experience a significant piece of the pie is the small minority of doctors who practice bad medicine, get sued (sometimes multiple times) but are seldom sanctioned by state medical boards and keep on practicing bad medicine.

There's the amount paid out in awards
There's the amount paid out in settlements
Both of those go to increased premiums, increasing the cost of practicing medicine, and passed on to the consumers.

Then there is the amount spend on defensive medicine, spending more on unneeded tests, just to keep from being sued for malpractice.

So while the jury awarded money may be a fairly small percentage of the increased cost of health care, malpractice suits (& the threat of them) have a far bigger impact than just the jury awarded money.

Keep plugging away, Cap'n.

I'm with you all the way. This is a real issue and you're looking at it the right way untile you say, in the last paragraph, "No, but the awards have become much more lucrative in the last fifteen years."

The person who was truly fouled would probably not agree with your characterization of his award as lucrative. He'd probably rather have his other kidney back than get a pile of cash.

Did you do a literature search? I don't know if you have access to the research facilities at a university, but that would be a good first step. I am currently working on a PhD in Sociology, and I know that a great deal of sociological research is in the area of health care. I would be stunned if someone has not already performed researched into this area.

Even if you don't agree with the conclusions, knowing the methodology of others can be a big time saver in research. There also may be other data sources that you might find useful.

I come down strongly on the side of the doctors. No other profession does more for us all than they do. First, they must endure 4 college years where they must take the most difficult courses and earn high grades to then compete for medical school entrance (less than half who apply are accepted). Then there are 4 horrendous years of med school, accumulating great debt, taking extremely difficult board exams, etc. Then comes an even more demanding residency from 3 to as many as 7 years in length with pay in the 40 to 50K range, 60 hour weeks or longer, and more board and licensing exams. Then they can actually practice medicine if they can find insurers and begin to pay back their average debt of about $150,000 or more. The wonder is that we have so many wonderful people willing to do this for all of us. The bad apples are few. Most doctors I know are noble.

Ed:

Med Mal is so heavily regulated in many states, including Florida, that the courthouse door is effectively shut to all but the most high-value cases. Thus, you can expect that, the greater the constraints on med mal lawsuits, the higher the average jury award will be.

What a great thread! Thank you Ed.

You're research was better then mine in the last thread; I appreciate the link to the data.

Upon initial review, it would seem that the rises in awards don't match the rises in health care costs - there's some correlation in inflationary costs, but it doesn't seem as if med. malpractice is causing the prices we see today, as is claimed by many.

Cap'n:

I work for a firm that specializes in this type of analysis. You can find our website here: www.elawforum.com.

I'd be more than willing to add my expertise to your project as I have been analyzing endeavours such as this for the last four years.

Some general observations:

1. Remember that the plaintiff's bar get roughly a third of the awards. A Med-Mal case generally relies heavily on highly-paid experts. The capping of payouts means that plaintiff's lawyers are more cautious in the cases they litigate, which has some impact on the upward trend.

2. Med-Mal insurance premiums increase each year of a doctor's professional career, irregardless of the claims made against him/her. This is because the malpractice claim generally has no "statute of limitations" attached to it. Therefore, the longer you practice, the more likely it becomes that a claim (or multiple claims) will be filed against you.

3. You don't capture defense cost in this data, although you're right to wonder about them. My experience tells me that for this docket of cases, I would expect a 4:1 ratio. That is to say, four dollars of settlement/award for each dollar of defense cost.

Maybe one of our congresscritters will provide an earmark to turn the 'data bank' into a true searchable database.

yes bio mom they are nearly ready for sainthood, all they need is one more miracle.

but tell me please:

why do the ones that tell me with a straight face that i need to walk more to lose weight (its like smoking used to be), then fight to the death for a parking place at the hospital nearest the door to their office?

C

Some other vectors that should be considered.

Can we break out med-mal with private insurance v. med-mal for Medicare patients? I am wondering how that will affect things - are Medicare docs driving up the rates for everyone?

I have indirect experience with poor care from Medicare patients. A young couple of my acquaintance recently had a baby girl born with an extremely rare birth defect.

Literally, the girl's spine was incomplete, and was delivered in a U-shape - bent backwards, with the backs of her ankles touching the back of her head.

The parents were completely blindsided at delivery - they had no idea this was coming.

However, several doctors in the process of treating this girl noted that this could be diagnosed from ultrasounds, but the couple's doctor apparently never bothered to look at them (he never performed the ultrasound, apparently a nurse did, and the nurse either didn't want to stick her neck out or couldn't do the diagnosis either).

But it's not really a good med-mal claim - the doctor could not have prevented the birth defect, and so the only real arguments is that the couple suffered emotional distress at delivery and never had the chance to abort the child.

Incidentally, nurses hate this pediatrician - several encouraged the couple to sue (off the record, of course).

The point - he's a Medicare doc - would never be able to keep a private practice going (bad bedside manner among other things) so he takes patients who don't have any other choice.

My understanding is that Medicare is now seriously underpaying for services in comparison to what even the most pushy HMOs will agree to, so just getting access to a doc on Medicare is pretty tough. Anyone else have relevant detail on that?

there is another aspect of preventive medicine to avoid litigation.

that is preventitive maintainence to avoid litigation in the building and equipment areas.

there are thousands of smaller machines in a modern hospital. some of them take over breathing for a patient, some of them take over kidney function for a patient, some of them take over heart function for a patient.

there are literally gadgets by the thousands.

every one of these gadgets has to be maintained on a regular basis (the timing has to be figured out by a formula somewhat like throwing chicken bones in a circle on the ground)by a technician who is certified to maintain the particular gadget and records kept of that maintainence for many years.

detailed records of each and every instrument, gadget, machine, you name it.

some stuff is looked at every couple of years (yup the water tower is still standing), other stuff more often (some brands/models of defilibrators had to be checked every time they were used).

this kind of stuff is a major cost driver for high medical care costs but its absolutely necessary for defense in court.

C

As a practicing radiologist, I am the unwitting beneficiary of at least a part of defensive medicine. Medical imaging is increasing dramatically, in an effort to avoid being accused of "doing nothing" in the face of patient concerns. I just read 'em, with a few exceptions (mainly mammography) I don't order 'em.

Texas passed Prop 12 a couple of years ago, capping non-economic damages, similar to but not as effective as California's MICRA. The complaint now is that children (without an economic history) and retired people (with no income) are effectively locked out of the court for all but the most egregious mistakes.

The Texas State Medical Board is now as much as 12 months behind in processing applications for licensure, in part because Texas has a good economy and med-mal reform.

The statement that liability is open-ended is not true. At least according to my Texas Medical Jurisprudence exam, the statute of limitations is 2 years, with the exception of children, when it is age 18 plus 2 years. My med-mal rates increased for the first few years of practice, but have been steady (or declining) after that. Med-mal policies now are "occurence" policies that cover you for suits filed during the period of coverage, usually a year at a time. To cover yourself in retirement or when leaving a job, there is either a "tail" policy to cover any remaining liability, or continuation of your occurence coverage with another med-mal provider. With the exception of children, you don't have a lifetime backlog of liability, you really have maybe 3-5 years of liability. Things that go badly wrong tend to do so rather quickly.

Ed, if you want a good med-mal control state, Indiana has been the most doctor-friendly state for years. They have a three-doctor panel review suits to certify that there is merit prior to going to trial.

If it's any indication of the changes from medical malpractice reform, our rates from Texas Medical Liability Trust have dropped by 31% from 2003 to 2008, the years following the damage cap. There was a pulse of suits in 2003 before the cap slammed down (thank you, Texas voters), but med-mal defense lawyers have had a hard time of it in the years since.

From down here in the trenches, it's not liability per se that drives the cost of medicine, it's the "emanations and penumbras" of true liability (i.e., defensive medicine) that are the major effect on overall medical costs. That, and unreasonable expectations. We aren't perfect, there's a reason we "practice" medicine.

And BTW, did that Harvard study control for severity of condition? Getting a medication order wrong on a terminal patient is still an "error", and one to be avoided -- but people DO die, eventually. This fact is often lost on people. The "100,000" number is excessive, IMO.

As for the 1:3 chance of malpractice, I have serious doubts about that number.

And just to second PK's comments above, the cost of all of our disposable items is undoubtedly increased by liability issues for medical device manufacturers. The core biopsy needles we use to get little pieces of tissue for pathologic review are $250-350 every time we open a package.

If you're going to examine liability, consider the costs of medical liability coverage incurred by companies like GE, Siemens, Philips, Cardinal Health, J&J, Stryker and the many smaller companies that supply the devices we use in medicine. The larger ones may not have outside insurance and may use set-asides for self-insurance purposes, but that's a cost borne by the consumer in any event.

Darren Duvall:

You're comments on med-mal insurance are insightful. I've have been told by clients in Maryland that the statute of limitations is virtually forever. I'm glad to see that my statements on that don't carry for the entire country. It might just be Maryland; in fact, given that a third or more of the General Assembly are trial lawyers, it probably is. It is my understanding from doctors here that there are very few med-mal insurance providers in Maryland, so that might account for the constant increase in rates.

I love the idea of the three-doctor certifying panel and wish a few other states would try it.

I'd be careful about the implication that a drop in rates indicates a drop in liability payouts, especially with a newly established trust. Your rates will inevitably drop as the trust earns interest and hopefully gets a little larger each year. That doesn't necessarily mean that the trust is paying out less to plaintiffs. Is there any way to see the trust's balance sheet? That would give a good indication of whether the drop in your rates is from good trust management or decreased payouts. Beyond that, I haven't had time to play the Captain's data source, so I don't know whether it has a breakdown by state or not. That would be the ideal way to check the correlation of reform measures in various states to liability payouts.

Also, I don't see where the 1:3 number came from, but I assume that it is was me. I never said that you had a 33% chance of being sued. I was suggesting that since we lack the defense cost data on this data set, that a 4:1 ratio of liability to defense costs might be a good proxy. To be honest, I have no idea how many doctors get sued every year, although I'd be surprised if every doctor in America doesn't get hit with at least one claim (founded or unfounded) sometime during their professional career.