Rhode Island Replaces Texas on Crisis List
AMA eVoice: May 26, 2005:
FROM THE PRESIDENT
Two states are seeing changes in their medical liability climates.
First, the good news. We've created a new category for states where effective reforms are halting the crisis. Texas is the first state to enter this category.
In September 2003, voters passed a constitutional amendment that allowed the state legislature to pass good reforms that can't be challenged in the courts.
Since then, Texas has seen all five of its largest insurers cut physicians' medical liability insurance rates. Physicians - especially high-risk specialists like neurosurgeons and obstetricians - are back in practice. And that means access to care for our patients is headed in the right direction.
Unfortunately, the opposite is true in Rhode Island - which joins 19 other crisis states. Soaring jury verdicts are driving medical liability insurance premiums beyond the reach of Rhode Island physicians.
Fully 49 percent of Rhode Island physicians say these costs have caused them to stop or consider stopping certain services. And 48 percent say they're thinking about leaving the state or giving up their practice.
Rhode Island and the other crisis states need to follow Texas' lead - and enact proven reforms. And once we've got good reforms in place - whether it's state by state or through federal legislation - it's not game over. It's game begun. From there, we need to look at stronger expert witness standards, stronger arbitration requirements and even medical court systems. Nothing should be off the table.
The AMA remains committed to medical liability reform. Together we can work with each state to make it a reality for patients across America. Because together we are stronger.
John Nelson, MD
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Another negative trend for all physicians trying to cope with uncontrolled escalations in medical liability premiums is significant income reductions produced by the continuing reductions in payment for their services from private and public third party payers, especially the federal Medicare program.
How will Medicare cuts affect your state?
Projected reductions in Medicare physician payment rates of 26 percent over a six-year period starting next year will affect all 50 states.
Visit http://enews.ama-assn.org/UM/T.asp?A40.442.2339.34.271796 and select your state in the drop-down menu to see how your state will be affected.
Visit http://enews.ama-assn.org/UM/T.asp?A40.442.2339.35.271796 to contact your members of Congress to support legislation to stop the cuts.
********************************************************************************
A PERSONAL INJURY COMPENSATION SYSTEM BROKEN BEYOND REPAIR?:
Over the last 50 years, tort costs in the U.S. have grown more than 100-fold from less than $2 billion in 1950 to $246 billion in 2003. This translates to a cost of $845 per person in 2003, compared to $12 in 1950. At this growth rate, tort costs could approach $1,000 per person by 2006. Gross Domestic Product, by contrast, has grown by a factor of 37; population by a factor of less than two.
The cost of the entire U.S. tort system increased 5.4 percent to $246 billion in 2003. About 9 percent of this total (over $21 billion) represented total medical liability costs.
Paradoxically, the majority of dollars moving through the U.S. tort system never reach the plaintiffs who suffered damages. Overall, just 22 cents of the tort dollar compensates victims for economic loss; 24 percent pays non-economic losses. More than half of every tort dollar—at least 54 percent—never reaches the victims.
A recent essay in the op-ed section of the May 30, 2005 Providence Journal reviewed the national statistics that help explain the intransigence of the problem.
According to Edward A. Kent, MD, President of the Rhode Island Society of Anestheseologists, entitled "Trial Lawyers Waste Taxes, Eject Doctors", 80 percent of cases alleging malpractice are dropped after they have burdened the tort system. Of the remaining 20 percent, 80 percent are settled with costs to the plaintiff's insurance company and 20 percent proceed to trial by jury. The physician is found not guilty by the jury 80 percent of the time.
It would be useful if all of the stakeholders in the medical tort system, especially members of the tax-paying public, were aware of the implications of these national statistics.
For example, based on these figures, for every 100,000 alleged malpractice claims filed by trial attorneys, 80,000 are dropped after they have burdened the tort system with significant expenses and adjudication delays, without any payments to the plaintiff or their lawyer.
Of the 20,000 not dropped, 16,000 are ultimately settled by the insurance company and defendant's lawyer with costs in the form of out-of-court settlements paid to the plaintiff and his or her lawyer (generally, the trial lawyer receives 20 percent of the total payment minus his or her itemized expenses).
The remaining 4,000 proceed to trial by jury. Of these cases (4 percent of every 100,000 claims), 3,200 receive an innocent verdict and 800 (0.8 percent) are found guilty resulting in awards to both the plaintiff and his or her lawyer (generally, the trial lawyer receives 30 percent of the jury award minus his or her itemized expenses).
Based on these statistics, the end result is that only about 17 percent (16,800) out of every 100,000 claims are being settled with cash awards paid to both the plaintiff and their lawyer.
The key number, however, is that a super majority of 83% of all alleged medical malpractice claims in the United States are settled without remuneration or financial costs to the party alleging a physician negligence-related personal injury.
Any unbiased, non-partisan view of these facts would suggest that, in its current configuration, the U.S. healthcare's personal injury adjudication system is analogous to a rapidly expanding $21 billion national lottery with two main features:
FROM THE PRESIDENT
Two states are seeing changes in their medical liability climates.
First, the good news. We've created a new category for states where effective reforms are halting the crisis. Texas is the first state to enter this category.
In September 2003, voters passed a constitutional amendment that allowed the state legislature to pass good reforms that can't be challenged in the courts.
Since then, Texas has seen all five of its largest insurers cut physicians' medical liability insurance rates. Physicians - especially high-risk specialists like neurosurgeons and obstetricians - are back in practice. And that means access to care for our patients is headed in the right direction.
Unfortunately, the opposite is true in Rhode Island - which joins 19 other crisis states. Soaring jury verdicts are driving medical liability insurance premiums beyond the reach of Rhode Island physicians.
Fully 49 percent of Rhode Island physicians say these costs have caused them to stop or consider stopping certain services. And 48 percent say they're thinking about leaving the state or giving up their practice.
Rhode Island and the other crisis states need to follow Texas' lead - and enact proven reforms. And once we've got good reforms in place - whether it's state by state or through federal legislation - it's not game over. It's game begun. From there, we need to look at stronger expert witness standards, stronger arbitration requirements and even medical court systems. Nothing should be off the table.
The AMA remains committed to medical liability reform. Together we can work with each state to make it a reality for patients across America. Because together we are stronger.
John Nelson, MD
************************************************************************************
Another negative trend for all physicians trying to cope with uncontrolled escalations in medical liability premiums is significant income reductions produced by the continuing reductions in payment for their services from private and public third party payers, especially the federal Medicare program.
How will Medicare cuts affect your state?
Projected reductions in Medicare physician payment rates of 26 percent over a six-year period starting next year will affect all 50 states.
Visit http://enews.ama-assn.org/UM/T.asp?A40.442.2339.34.271796 and select your state in the drop-down menu to see how your state will be affected.
Visit http://enews.ama-assn.org/UM/T.asp?A40.442.2339.35.271796 to contact your members of Congress to support legislation to stop the cuts.
********************************************************************************
A PERSONAL INJURY COMPENSATION SYSTEM BROKEN BEYOND REPAIR?:
Over the last 50 years, tort costs in the U.S. have grown more than 100-fold from less than $2 billion in 1950 to $246 billion in 2003. This translates to a cost of $845 per person in 2003, compared to $12 in 1950. At this growth rate, tort costs could approach $1,000 per person by 2006. Gross Domestic Product, by contrast, has grown by a factor of 37; population by a factor of less than two.
The cost of the entire U.S. tort system increased 5.4 percent to $246 billion in 2003. About 9 percent of this total (over $21 billion) represented total medical liability costs.
Paradoxically, the majority of dollars moving through the U.S. tort system never reach the plaintiffs who suffered damages. Overall, just 22 cents of the tort dollar compensates victims for economic loss; 24 percent pays non-economic losses. More than half of every tort dollar—at least 54 percent—never reaches the victims.
A recent essay in the op-ed section of the May 30, 2005 Providence Journal reviewed the national statistics that help explain the intransigence of the problem.
According to Edward A. Kent, MD, President of the Rhode Island Society of Anestheseologists, entitled "Trial Lawyers Waste Taxes, Eject Doctors", 80 percent of cases alleging malpractice are dropped after they have burdened the tort system. Of the remaining 20 percent, 80 percent are settled with costs to the plaintiff's insurance company and 20 percent proceed to trial by jury. The physician is found not guilty by the jury 80 percent of the time.
It would be useful if all of the stakeholders in the medical tort system, especially members of the tax-paying public, were aware of the implications of these national statistics.
For example, based on these figures, for every 100,000 alleged malpractice claims filed by trial attorneys, 80,000 are dropped after they have burdened the tort system with significant expenses and adjudication delays, without any payments to the plaintiff or their lawyer.
Of the 20,000 not dropped, 16,000 are ultimately settled by the insurance company and defendant's lawyer with costs in the form of out-of-court settlements paid to the plaintiff and his or her lawyer (generally, the trial lawyer receives 20 percent of the total payment minus his or her itemized expenses).
The remaining 4,000 proceed to trial by jury. Of these cases (4 percent of every 100,000 claims), 3,200 receive an innocent verdict and 800 (0.8 percent) are found guilty resulting in awards to both the plaintiff and his or her lawyer (generally, the trial lawyer receives 30 percent of the jury award minus his or her itemized expenses).
Based on these statistics, the end result is that only about 17 percent (16,800) out of every 100,000 claims are being settled with cash awards paid to both the plaintiff and their lawyer.
The key number, however, is that a super majority of 83% of all alleged medical malpractice claims in the United States are settled without remuneration or financial costs to the party alleging a physician negligence-related personal injury.
Any unbiased, non-partisan view of these facts would suggest that, in its current configuration, the U.S. healthcare's personal injury adjudication system is analogous to a rapidly expanding $21 billion national lottery with two main features:
- a 17 percent chance of winning, and
- no need for either of the two parties seeking remuneration to buy a ticket.
May 31, 2005:
posted by Bob Coli, MD at 11:18 AM
