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Jan. 9, 2003

Medical Errors, Not Lawsuits, are Real Cause of Rising Malpractice Insurance Premiums

Statement of Public Citizen President Joan Claybrook

Three years ago, the Institute of Medicine released its report on patient safety in the United States. The report’s findings were shocking — that between 44,000 and 98,000 Americans die in hospitals each year as a result of preventable medical errors. The upper estimate is more than highway, breast cancer or AIDS deaths. The report made consumer advocates hopeful that policymakers would finally address what we know is a major public health problem.

Unfortunately, nothing has happened to make patients safer. Since then, the economy has soured, leading to investment losses and lower profits for malpractice insurers. To fill the financial void, insurers raised liability premiums for many insurance lines, including big hikes for doctors. In reaction to the steep increases, doctors and insurers have falsely blamed higher premiums on injured patients who exercise their right to seek remedy in the courtroom.

To divert attention from the real causes, physicians have declared war on the patients they took an oath to protect. That’s a sorry statement about the ethics of today’s medical profession. These tactics are deplorable. The first casualty in this debate has been the truth.

The fact is that there is no litigation crisis. There has been no sudden increase in claims. In fact, there was a four percent reduction between 1995 and 2000. But there is a health care crisis. The medical lobby should stop lying and look in the mirror rather than team up with the big insurance companies to deny injured patients the right to challenge malpractice doctors. According to a survey released in December in the New England Journal of Medicine, more than a third of the doctors surveyed said either they or members of their family had experienced medical errors, and most of those were serious.

Doctors and insurers claim that jury verdicts are skyrocketing, but they are not. They also claim that juries are out of control. Studies show they are not. Most people who are injured don’t even sue, and of those who file suit, many drop their claims during litigation. The legal system itself has checks and balances. Judges and juries, who hear all the evidence and arguments of a case, should decide the award – not politicians in Washington. And jury awards are subject to review in at least two levels of appeal.

Malpractice premiums are rising as a result of a business cycle wholly unrelated to tort claims. Liability insurance expenditures and victim compensation are barely keeping pace with overall increases in health care costs. Claims have not skyrocketed, nor have average award amounts.

Capping jury verdicts is not the answer. In California, which has done just that, insurance rates did not fall. Further, limits hurt those who have suffered the most harm – people who have experienced brain damage, spinal cord injuries, operations on the wrong part of the body and other life-altering conditions due to medical errors. It simply isn’t right to tell these people they can’t be fully compensated for their devastating injuries.

The economic costs of medical malpractice are between $17 and $29 billion annually. But we spend just $6.7 billion on the entire medical liability system. This includes all the litigation costs and court awards. That’s about what we spend annually on dog food.

It’s unconscionable that doctors have walked out of hospitals. This is a classic case of blaming the victim. Instead, doctors should be calling on medical boards to better police their own and demanding reform of the insurance industry. But state medical boards have been asleep on the job.

Equally unconscionable has been the doctors’ choice of battlegrounds. Doctors are first targeting the low-income, largely rural states like Nevada, Mississippi and West Virginia, which always are medically under-served. These states with fewer doctors provide the medical lobby with huge leverage, guaranteeing maximum national media exposure.

It would be a travesty of justice for Congress and state legislatures to take away patients’ legal rights in the name of protecting insurance company profits and doctors’ income. This is a prescription for even more medical errors and more suffering, because the legal system is all patients have to ensure just compensation for injury and to force improvements in patient safety. It’s clear that the current regulatory system is not up to the task.

*****

Our goal today is not just to refute the phony charges but to call on the medical establishment to do more to prevent malpractice and medical errors. Prevention is the cheapest remedy. That’s what will make patients safer, reduce lawsuits and bring down insurance premiums.

  • First, state medical boards should do more to discipline negligent and incompetent doctors. Doctors who repeatedly injure patients because of preventable mistakes should lose their licenses to practice.
  • Medical boards responsible for enforcement should sever links with state medical societies and be given more money and staff to investigate complaints.
  • States should require hospitals and other health care providers to institute meaningful risk prevention programs.
  • Doctors should be recertified based on a written exam and audit of their patients’ medical records.
  • The National Practitioner Data Bank should be open to the public, not be a secret docket that patients cannot use to check out their doctors.
  • Also, hospitals should implement measures to cut down on errors – such as using computers to order and track prescriptions, requiring proper hand-washing to reduce infections, addressing the nursing shortage, and reducing the long hours of medical residents.

For too long, doctors and hospitals have been able to shift the costs of their carelessness onto victims, most of whom never file a claim for their losses. This "compensation gap" has allowed the medical community to cover up the problem of medical errors.

It is time for Congress and state legislators to assume leadership in reducing malpractice. It is time for state medical boards to wake up and protect patients rather than bad doctors. It is time for doctors to demand better policing of their own profession.

If lawmakers are serious about addressing malpractice premiums, they should stop blaming the victims and enact measures to reduce medical errors, because that’s where the problem begins. If they don’t, we will again be facing drastic malpractice insurance rate increases.

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