Some Glimmers of Hope on the Tort Reform Front

Sandra Yin

May 31, 2011 (Washington, DC) — Despite a challenging national landscape for tort reform, 2 speakers at a session on resuscitating liability reform here at the American College of Emergency Physicians 2011 Leadership and Advocacy Conference offered some glimmers of hope.

Although it might not be a good time to push for tort reform at the national level, Matt Fullenbaum, director of legislation for the American Tort Reform Association, told attendees that he's "more bullish on the states," citing several states, including Wisconsin, that have passed significant tort reform. Tennessee's legislature has established caps on noneconomic damages of $750,000. "Things are moving in the right direction," he said.

Such caps can help rein in growth in premiums. In the 1970s, Mr. Fullenbaum pointed out that noneconomic damages were capped at $250,000 in California. Between 1976 and 2009, the total malpractice premiums in the United States rose by 945%, while in California premiums grew much more slowly, by 261%.

"If you can pass medical liability reform in West Virginia, Mississippi, and Illinois, you can do it in your state too," Mr. Fullenbaum said. But he warned that doing so "requires the single-minded focus that the other side brings to the table." It took 15 years to achieve tort reform in Texas, he noted.

To make headway in liability reform, it's important to learn how the opposition thinks, Mr. Fullenbaum said. "All they care about is more lawsuits," he said.

"Trial lawyer algebra," which plaintiffs' attorneys use to evaluate whether to take a case, reflects that priority. According to Mr. Fullenbaum, the variables they consider are the cost of bringing a case, the potential for success, and the size of recovery (damages).

The next presentation in the panel offered a different approach. "Maybe it's time we stopped banging our heads against the wall and tried something new," said Peter Smulowitz, MD, FACEP, an emergency physician at Beth Israel Deaconess Medical Center in Boston, Massachusetts.

"The current medical malpractice system is an impediment to patient safety," he said. "The status quo is not working."

Dr. Smulowitz discussed a fresh approach to medical liability reform, known as "Disclosure, Apology, and Offer" (DA&O). Its main tenets are to disclose to patients and families when unanticipated bad outcomes occur, to apologize when a mistake is made, and offer compensation when appropriate. But it shouldn't be construed as a payout to mollify patients or a handout given every time an adverse events or outcome occurs, he said.

In 2006, the Veterans Affairs healthcare system in Lexington, Kentucky, was the first to use this approach. The University of Michigan Health System has also adopted the DA&O model. In the Michigan approach, before any claim is filed, when an adverse event is discovered, it is disclosed to the patient. Findings from the investigation are shared with the patient and their family. Simultaneously, a separate claims process begins the traditional analysis of the risk and value of the case. Within 3 months, final conclusions are shared with the patient and, from that point, either all sides agree there is no claim, a settlement is made, or if they can't agree on a settlement, the case may go to court.

Skeptics often wonder whether telling patients about bad things happening will boost the number of lawsuits and liability costs. But after full implementation, the total number of claims dropped, Dr. Smulowitz said. Total liability costs decreased by almost 60% after implementation of the program. Even when cases did go to court, the average amount spent on each lawsuit decreased by almost half.

From a patient safety perspective, promoting a transparent program that's not intent on assigning individual blame led to a dramatic increase in incident reports.

A broad range of stakeholders in Massachusetts seem receptive to the DA&O concept, Dr. Smulowitz said. As part of a planning grant, he was part of a team that interviewed 27 stakeholders. They included state agencies; the secretary of health and human services and key legislators; physicians, physician groups, and hospitals; attorneys — both plaintiff and defense bar; malpractice carriers; patient safety organizations; and a business organization.

"The main take-home message we heard time and time again from across the spectrum of stakeholders was that this approach was indeed the right thing to do, and that this program had the right components for an ideal system by which to resolve disputes and improve patient safety," Dr. Smulowitz said. "Yes, even the attorneys felt this was the right approach."

"I think it's promising," Mr. Fullenbaum told Medscape Medical News. "We're certainly supportive of anything that we think will bring fairness and balance to medical liability reform."

But he isn't convinced that personal injury lawyers might actually support civil justice reform. "I just can't imagine a scenario where they would line up to see their bottom-line cut," he said.

Dr. Smulowitz and Mr. Fullenbaum have disclosed no relevant financial relationships.

American College of Emergency Physicians 2011 Leadership and Advocacy Conference (ACEP-LAC). Presented May 23, 2011.