The Medical Malpractice Debate
VA hospital model demonstrates that Honesty is the best policy
|
While physicians, insurance companies, consumer advocates, and trial attorneys place the blame on one another for high malpractice insurance costs, a Lexington hospital’s full disclosure policy significantly lowered its liability costs and may be a model to replicate.
Physicians and consumer advocates in Kentucky and Washington are again doing battle over whether to limit damages in medical malpractice lawsuits. Doctors say that high liability insurance premiums resulting from frivolous lawsuits and high jury awards are driving them out of business.
Many favor a cap on how much money a jury or judge can order medical providers to pay in a malpractice case. The cap would limit how much a court could award in punitive damages (as punishment for serious negligence or wrongdoing), and for “non-economic damages (such as pain and suffering) which—unlike medical costs or loss of earning capacity—are not easily measured in dollars. Consumer advocates and trial lawyers maintain that the premiums are rising for different reasons, and that limits on damages effectively penalize the victims of medical errors.
Yet some say there is an effective alternative which could save money for medical providers and fairly compensate the families for loss of life or quality of life. What’s more, a leading example of it is right here in Kentucky. The Veterans Hospital in Lexington has received national attention for lowering its liability costs by changing its policy for dealing with families harmed by medical errors. Now its policy is being replicated by other hospitals across the country – though not yet in Kentucky. Back in 1987, the hospital began admitting errors up front and negotiating with the families for fair payments, said Dr. Steve S. Kraman, former chief of staff at the VA who is now Vice Chairman of the Department of Internal Medicine at the University of Kentucky Clinic. Over the next 16 years, its average payout per case was only $16,000. The reason the approach worked, Kraman said, is that grieving families are more interested in an acknowledgement of their suffering by the hospital than in filing suit. “They get angry when you refuse to talk to them,” he said. “That’s a pretty miserable way to treat people and … when they get angry enough they’re willing to go through all the hassle of a lawsuit.” Furthermore, Kraman said, the VA’s policy put it in a better legal position when families did file suit because it had a policy of addressing medical mistakes. Once the VA demonstrated in academic journals that its approach helped it dramatically reduce payments for medical errors the hospital’s “honesty policy” was picked up by other providers. Among them is the University of Michigan Health System, where legal expenses dropped from $3 million per year to $1 million per year, according to a news report. More recently, the Illinois Senate approved a proposal to create pilot programs based on the VA model in two Illinois hospitals (the pilot program is supported both by Illinois doctors and trial lawyers). A Republican legislator has just introduced a similar proposal in Tennessee. Proposing the Illinois law was the newly formed SorryWorks Coalition, which is promoting similar programs in 20 other states, including Kentucky. Yet the VA model has yet to get traction in its home state – in spite of national media attention in USA Today, MSNBC, PBS and other outlets.
Mongiardo expresses interest in VA model
That may soon change. State Sen. Daniel Mongiardo, a Hazard physician, believes that Kentucky lawmakers should look at the SorryWorks model along with other ways to resolve the liability insurance crisis, especially now that a bill to cap non-economic damages has again failed in the General Assembly. Mongiardo plans to hold a series of informal hearings between now and the next legislative session in January 2006. He said he anticipates that the hearings could result in support for some version of the SorryWorks proposal along with other reforms.
Of SorryWorks, the Kentucky Medical Association spokesman Marty White said, “We’re willing to consider any approach to keep doctors in Kentucky and help in recruiting them. This includes SorryWorks, insurance reform, patient safety protections and liability reform.”
|
(Officials with the Owensboro Medical Health System declined comment “at this time” on the use of such a model locally.) However it remains to be seen whether any version of SorryWorks would get the support of two of the state’s more prominent physicians, Gov. Ernie Fletcher and his secretary of Health and Family Services, Dr. James Holsinger.
Holsinger, formerly chief medical director for the Veterans Health Administration, said in a documentary about the VA program on PBS in 2000 that it would be impossible to use the same kind of approach outside the federal government’s hospitals. Holsinger said in a recent interview with the Public Life Advocate that the federally-run VA hospitals have ways of discouraging malpractice suits that other hospitals don’t. They include administrative procedures that plaintiffs must follow before filing a lawsuit and the fact that the lawsuits are tried in federal court, where the guidelines for lawsuits are tougher.
“Yes, I think marginally you may be able to reduce your costs, but you will not see anything remotely [like] the small number of malpractice cases filed in federal court against the Department of Veterans Affairs all over the country,” Holsinger said. Kraman disagreed. “It’s working in the private sector” at Johns Hopkins Hospital in Baltimore, the University of Michigan Health System, the Minneapolis Children’s Hospitals and COPIC Insurance Company, he said.
Holsinger suggested the approach still might be too risky. “The biggest problem is what happens if it doesn’t work” after an administrator has “developed an entirely different culture in the hospital as far as dealing with medical errors is concerned,” he said. “How do I put that genie back in the bottle?” On the other hand, Kraman asked, where is the evidence that “concealment, deny-and-defend strategies have been a satisfactory method of risk management? “Decency does not have to be proven and yes, it is affordable.”
How does the VA model work?
The VA’s experience with an “honesty policy” began back in 1987. “We discovered a case where a patient had been killed by a medication error,” Kraman explained. “The relatives had already come and claimed the body. There was really no way for them to know it.” The VA’s risk management committee considered filing the case away and forgetting it, Kraman said. Instead, the hospital set up a meeting with the relatives and suggested they bring an attorney.
|
“We disclosed the whole thing,” Kraman said. “We told them we felt they were owed compensation and we wanted to negotiate that with their attorney. Then Ginny Hamm, our attorney, sat down with their attorney, and after a few weeks, they came up with a mutually acceptable settlement.”
The approach worked so well, “we decided that was going to be our model from then on,” Kraman said. Along the way, the Lexington hospital tracked its results. After 10 years, it compared them to similar VA hospitals. Even though the Lexington VA was voluntarily disclosing and thus had more cases, their payouts proved to be much lower than average. Kraman and Hamm published those findings in the Annals of Internal Medicine and Fordham Urban Law Journal. Since then, a number of other hospitals “have started quietly doing this on their own,” Kraman said.
More recent comparisons bear out the VA’s early experience. In 2000, the average payouts for pre-trial settlements among all VA hospitals was $98,000. Settlements at trial averaged $250,000, and the average judgment when cases were tried and lost was $450,000. By comparison,the Lexington VA’s average settlement for all cases in 2000 was $26,000. Kraman emphasized that the hospital does not offer compensation for bad outcomes that are nobody’s fault. “We would fight that, even if somebody was threatening to sue us.” At the same time, the hospital does not require families to waive their right to sue, and encourages them to involve attorneys in the negotiations. Besides the savings, Kraman said, the program has proved to have other benefits:
A malpractice insurer tries the VA model
A private insurer in Denver has been running a variant of the VA plan as a pilot program. So far, COPIC Insurance Company’s “3Rs Program,” now in its fourth year, has produced encouraging results, according to Dr. Richert Quinn, its director. The three Rs stand for Recognize, Respond, and Resolve. Physicians who sign up for the program must agree to report errors and stay in personal contact with the patient if at all possible.
As with the VA, patients accepting settlements need not waive their right to sue. Of the 435 qualifying incidents handled this way in the first three years, COPIC reimbursed only 153 patients. None of the payouts exceeded $27,000 and the average 3R settlement was $1,820. (By comparison, the average payout for other settlements by the insurer was $78,741). Not one case went to litigation. What accounts for the results? When an unanticipated incident occurs, Quinn said, “The patient experiences three kinds of trauma, all at once: emotional, physical, and financial.” Keeping the doctor/patient relationship intact, he said, makes patients less likely to attribute every bad outcome to substandard care and more likely to see what happened as “a forgivable mistake.”
What’s happening in Illinois
Kraman’s VA program also caught the attention of Doug Wojcieszak of Illinois, whose 39-year-old brother died during surgery after doctors repeatedly misdiagnosed his heart attacks. Afterward, Wojcieszak’s family could get no information from his brother’s medical providers. “They just cut the family off. Nobody talked to us. Records were not forthcoming. Nothing. Until after the case was settled a year and half later and money had changed hands. Then they talked.” Wojcieszak, however, was not just another angry relative. He was a staff member of the Illinois General Assembly, accustomed to working on public policy issues.
He understood the pressures that made doctors unwilling to talk to his family about their mistakes. Determined to relieve those pressures, Wojcieszak first lobbied for limits on damages from malpractice lawsuits along the lines now proposed by the Bush administration. But Kraman’s approach, he decided, was much better. Wojcieszak launched the SorryWorks Coalition, and it succeeded in convincing the Illinois Senate to pass the bill for pilot programs at two hospitals.
If the bill becomes law, the participating hospitals could try the SorryWorks program with no financial risk. The state would pay the difference if settlement costs during the trial period exceeded the hospitals’ average for the past five years. At present, the Illinois Medical Association and the Illinois Trial Lawyers have introduced bills pushing competing plans for medical reform. Both contain provisions for funding the SorryWorks pilot programs.
|
||||||||||||||||||||||||||||||||||||||||||||||