WWL>Topics>>11-6-13 1:10pm Angela: on medical malpractice insurance

11-6-13 1:10pm Angela: on medical malpractice insurance

Nov 6, 2013|

Angela discusses medical malpractice insurance with AMA delegates Dr. Floyd Buras and Dr. Van Culotta.

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Automatically Generated Transcript (may not be 100% accurate)

Will welcome everybody and a happy Wednesday in it is a happy Wednesday and we've got a great day planned three I think very interest in shows beginning with. One that I think we all need to pay much closer attention to. The cost of health care in America is made up of various factors and are certainly becoming more aware of all of them. As we have this national conversation. About the Affordable Care Act. Where does the health care dollar go. To the doctors of the hospitals the pharmaceutical companies the insurance industry. And to what isn't discussed very often malpractice insurance. So that's what we're gonna talk about today the price of malpractice insurance to the doctors and two months the patient or consumer. And joining us to discuss this is doctor Floyd bureaus a pediatrician in private practice and recent past president of the State's medical society. And doctor van colada and OBG lying in in private practice he is also -- past president of the state medical society. And both are delegates to the -- I'm thrilled to have you both back you're very good sports -- your regulars now -- -- -- thank you you. If they're first of all very interesting to me doctor -- that you comment and that you don't even like the words medical malpractice insurer -- would rather call it medical liability insurance. Right liability in the in the parent the word malpractice assumes that -- -- -- something wrong or created -- -- Most of the liability suits have to do list with outcomes that are not good. But everybody did everything right. It's just the illness itself was of such -- nature that the patient had an unfavorable -- -- So there's no Ed treatment if they were bad treatment with the medical society would wanna -- that mountain. And and take care internally in and deal with positions you don't do good job most of these are just their liability issues that car because. Medicine in and of itself is a very dangerous business. And not every time does he go like one would want it again. I think you bring a very important part a moment. Sometimes outcomes. Don't turn out as we would want them. But what you're saying is that is not malpractice that is just inevitable outcome are you an example I mean if a mother elects its very. Popular and -- to deliver -- home. And not in -- hospital -- suppose something goes wrong at home and you now -- guy in an ambulance and rushed to the hospital. You're going to have perhaps an unfavorable dot com. But it was because of the decision to deliver at home and not in hospital where resources were mailed. So there's probably going to be some liability issues they come out of that but it all comes back to the state to the fact that that patients make decisions that are sometimes. Not in the best interest. Would both of you agree that. There have been acts of incompetence. And no question about it. And I've been on review panels that hospice program on staff where. If a physician is identified as being. Subject to a great number there is there actually called before the state medical that -- did not statements at the hospital medical staff. And there's a due process. -- system in place where. They are charged or accused of performing that Madison and they have to you appear before the the medical staff committee. And explain what happened to him and why they're there issues are not unfavorable but the hospitals themselves have the duty. To credential each and every member of the staff and someone's not doing a good job hospital. And the medical staff have a duty to police themselves. That's the first line. It should be Jersey now the plans attorneys are gonna argue that. By by having liability. Issues come up there actually protecting patients. And that's the argument about having tort system to handle. -- favorable outcomes. I'm not so sure that decisions of this nature should be made violate jury. But that's the system we have in this country. And that's where the difficulty comes in because the jury may not have the expertise to really make inaccurate this determination. Where as a medical staff panel or -- Orleans parish medical society as a Judiciary Committee. Where physicians who don't practice good medicine has to appear and and explain themselves and things are found unfavorable on those committees we report that's straight to the state Board of Medical Examiners. Which ultimately has the duty to license or remove the license of incompetent practiced practitioners not doctors had lost yes. Let's go back and history. Was there always this sense of the risk of malpractice. Or is this a more -- in modern earning fifty years ago was this fear among -- I think it really eager to crisis proportions in the mid seventies. Late sixties early seventies. Prior to that many states -- -- -- or immunities doctrines. That prevented. Lawsuits. They begin to remove these in Louisiana. Oscar decision against too many years ago was one of the early ones. But also what happened in Louisiana in the early seventies -- we had a constitutional convention. And in that constitutional convention they removed stripped away that your community stuck to charity hospital. And many of the other hospitals so that was really the end of it and that's when -- began to see real crisis. In Louisiana. And in response to that we're seeing physicians who being unable to fine companies that would write an insurance. The cost of insurance was rising precipitously. And so the difficulty was we could not find enough insurance in the marketplace for the doctors it's important for the doctors to have this professional liability insurance. So that they can continue to practice. What do you all -- Well it depends upon the specialty we've predictive medicine spectrum down and roughly seven categories. Are sometimes eight depending upon. People would do -- respond -- -- -- maybe prize quest and come out to traditions. And then moved down the way -- of primary care physicians and we dual office were an absurd class one. And in between you know be the cardiologist invasive cardiologist into east general surgeons the best surgeons and depending upon where they fall they get a rate based upon that national spectrum. Specialties. It can be as high as 89000. Dollars a year foreigner surge -- -- sponsor Valero or will be -- and but the rates have been coming down because of actions of the patients compensation fund which is a unique system in Louisiana which will be happy to talk about. So so the average Doctor Who is not a primary care but that's a specialty. 5250. Denying it could be anywhere from from 45 hits in 90000 depending upon the surgical special. You know what I was reading an article about a study that that Harvard. Some years ago but it was really looking at. That the the whole. -- -- fear factor that's unfair but. What the study showed was that 93% of the doctors in Pennsylvania who studied. We're doing preventative medicine I mean protective Madison. So that. With the idea of doing these various calling -- -- story even avoiding their own words certain patient because of their concern. For malpractice. Glad that's a concern because one unfavorable outcome without a system in place to protect positions. Could threaten you for the rest of your life I mean if I had a ten million dollar judgment against me. As a pediatrician I'm never going to earned ten million dollars in my career. The pediatricians just don't get a lot of income from the practice is the lowest paid specialty a law. So that one judgment would mean I would never be able to hold the job because my wages would be honest against the judgment I would never be able to on house. How would never had any personal life because all of the income. If I ever had any income would be directed towards that judgment. So it's a liability issues that that would not be something I'll be willing to undertake without a system in place to protect. And that's where the liability insurance issue comes in and we don't have that we have that on our -- -- in the -- trips on you sidewalk. You know if you don't have insurance on your house he could lose your house in a judgment against -- You know we required in Louisiana and have liability insurance on -- will be. If you would hit somebody and have said they would suffer severe injuries that he didn't have that insurance. Then you would lose your livelihood your wages your house or whatever else he can't. So EU EU have the insurance to protect yourself. So that removes the fear factor because if I am involved in a situation I know that the insurance is actually there to protect me. Louisiana has a good system because the whole system is designed. To protect that the maintenance of medical practice in the state that it that the Supreme Court has ruled. That the legislature has a duty to make sure there -- enough positions in the state. And so they use that as the jump off point to make sure that we have a workable liability system. OK stay with us were gonna continue this talk on malpractice and what it's costing every one. And we're gonna hear about our system in Louisiana right after this I'm Angela and I didn't do well. Well we're talking about the price of health care and one element of it is. Not just medical malpractice insurance which -- when -- try to get away from calling it an animal medical malpractice. We have doctor Floyd bureaus and doctor -- lauded as our guest. Very interesting discussion on. First of all how lucky we are as a state which we're gonna get into -- with our situation for doctors. And perhaps is an example to other states but prior to that. It wasn't an easy road. Doctor -- you -- your first day while my first day which was July 1 of nineteen 76 when I was a brand new intern assigned to cherry hospital. And I showed up for work there was an attorney for the State's standing in the doorway saying do not -- there and -- patients. Because of the state did not have liability coverage for the entire class coming in. The years before that the two or three years before that the private insurers from the state left the state there was no one in the state writing medical liability insurance. So the residents and interns had no liability insurance. The state would be the next deep pocket to go after if there had been problems of the state attorneys did not want to bear that liability. And for five days we stood in the doorway charity watching people and a but -- forbidden by the state attorney. Two to see or touch and talk to a patient finally on the sixth day we've -- an attorney general Billy das throughout the latter. Without that letter saying the state have now agreed to cover. Liability issues and we are allowed for the first time to see patients for for five days surgeries were canceled and patients in the ER just -- because there was no one's seen him. Well at this as a reflection of what was going on at the time. This was the big change in the system -- started my internship and residency you could buy. A three million dollar professional medical liability insurance policies a resident for 300 dollars. The next year that policy disappeared you couldn't get at any price and the only available policy at the time was a 500000 dollar policy cost. Point 5000 dollars and as an intern you're making that kind of money you can -- afford to pay that. So what was actually happening was the attorney general's office was. Giving it suit against the physician. That had been suits called third party demand. So basically if they lost to the physician at cherry lost the case and the state had to pay they would ensued that doctor to get the money back. And that basically led to what was the first shut down the backdoor charity hospital in the history of cherry hospital. Because there was no liability the state finally passed the -- made the changes in the state attorney general's office reformed its ways. And we now have a system. Where we have coverage system. That provides for a truly injured and on limited dollar recovery for as long as that person lives. -- all or they wanna take your -- on settlement they canned it. The uniqueness of our system is that we will compensate. The severely problematic injury forest -- that patient and pay all of their medical's. Now we often hear that there's a limit of liability -- -- -- liabilities for everything but the medical's that it needed to take care of that person for the rest of their life. And right now the state of patience compensation fund which manages that treatment. Pays about twenty million to 2.2 million dollars a year for about 200 patients. To pay for their medical's every year ever their cost is and that could be a new van to transport a new wheelchair additions to their house. Modifications to showers -- ways whatever the court says is an applicable medical. The -- this -- pace for this for those patients so that they have no out of pocket expense for medical care for the rest of their. But then there's also the limit. The limit is really for for the everything but knuckles. So the economic damage whatever it may be the loss of income. On the loss of consortium all of the things that would be covered in 151 500000. But the real boon to our system in the new businesses. We can treat and care for those patients they get all the medical care they need for as long. But for for those people who think and and there are those people and let's not. Kid ourselves there are those people who think they can make a buck off of this I'm not talking about the severely injured that -- need medical care that is a beautiful thing that. They're going to be taking care. But there are people. In society who have their suit. As a college and so this. Is limiting them. What we have some steps in Louisiana that seem to ameliorate that problem. You first do not get into the courtroom until you go through what is called the review panel process. In Louisiana when you file a claim against what's called -- qualified healthcare provider whether that -- hospital a doctor or whatever. That then. Sets up the review process and what happens is that three experts. Review written testimony actuaries medical records. And render an opinion based upon. Unique language in the statute that says that this person fail to meet applicable standard care -- the person. Did meet the applicable standard of care and then we also have to say was the failure to meet the applicable standard of care a cause of the patient's injury. Perhaps the doctor didn't meet the applicable standard of care but that's why they had a problem. So all of these things have to be -- done and reported. And at that point the insurance companies the -- force the defense council's all get together look at that decision decide -- ago. And basically the system tends to weed out. About 90% of the suits that we would call frivolous and some -- basically keeps those people from just tried to make money off of and the bad outcome that really was nobody's fault. Okay. We're gonna come right back we have many more questions on the issue of malpractice. But first let's go to the newsroom and Chris Miller. We're talking about malpractice and that the cost not only to doctors but an infected patients because your fees are somewhat based on -- cost -- Where -- whether we want a -- not medicine is also -- business. So in essence we're all paying for this I think the good news you're telling me is that the state Louisiana really is doing it right. With our malpractice laws. Analyzer are there good. -- you know there's a system in place by the patients are protected. And because number one there's still. Liability issue which is for general. Damages which is up to 500000 dollars but more importantly. The patients compensation fund which is a separate fund to which all physicians hospitals and medical providers contribute. We pay into that system he pays the patient's medical damages all the damages for the rest of their lives. So if the patient has an unfavorable outcome because at that actions on the part of -- physician or hospital. Those damages -- carpet there compensated. Or as best you can made whole financially. By the patients compensation fund. More importantly by fixing the numbers. Of liability at 500000 dollars he allows the actuaries to be able to compute. Reasonable. Now practiced premiums because they know with the damages if we have an unlimited damages. A provision an actuary it would never be able to tell you what insurance should cost because you don't know what the damages -- The problem with those systems in this kinds of things we saw on you study from Pennsylvania when -- orthopedic doctors -- the state. And patients -- a drive across state lines to get orthopedic surgery or the example in Las Vegas. Where no obstetrician could deliver babies in Las Vegas so the woman showed up in not in labor in -- from Las Vegas she was put in an airplane. And flown to Phoenix or Los Angeles and of course it was a risk that she delivered in the plane or some other risk just from the transportation. However susceptible patient but because now hospitalized Vegas -- while deliveries to take place because of the unknown risks. When you fix the risk. And actuaries can compute a premium our coverage limit and that makes the system work. But we -- about a Louisiana system is now does it fix the risk. But it also provides an unlimited funds for patients who are truly -- that seems to be compromised that addresses both sides of the issue. I'm just curious if -- were doing right by our other states. It's really working. Well it has to do with the fact that professional medical liability uses state entities in each state has different rules and different. Consoles in it's constitution. For example -- Pennsylvania we're talking. The Pennsylvania constitution mandates against any kind of limits of liability. Off the California system which was enacted about the same time as a system has continued to do well it's different. But it does set some limits of liability. Recently Texas just -- alluded to earlier. Put in some constitutional changes -- it caps world legal and then they went and put together these series of rules and caps that are different from -- But they seem to work very well and taxes. I think the big issue is each state has to do this on its -- There was some lip service and they are Affordable Care Act to address the problems of medical liability insurance. But basically amounted to fifteen million dollars that we're going to be spent by the federal government for all fifty states. To look at alternative resolutions systems for the conflicts that arise in professional medical liability. To give your frame of reference the state of Louisiana at the patience compensation front. Pays out between 500 to one you know 130 million dollars every year and claims. And yet Affordable Care Act only dedicated fifteen million for the entire country so really that was mostly lip service and that record attempt to fix the system. So wasn't a million per state to look into how to do it it was a million per state. But that's what would be paid out -- But let me ask if you as an individual doctor are sued. And you win the case do your rates go won't even though he won. Well depending upon the company most companies do not raise the rates if you prevail in the suit however there is a cost of defense. And that cost of defense can be very expensive it can be. Somewhere it's up in the neighborhood of 10250000. To bring very complicated case. To a jury where in the trial handle the appeal and then that cost has to be borne by all of the members of the group -- by the insurance from the company. So it necessarily don't have an individual's rate increases but because the insurance has to be the cost of doing that defense system expert about everybody. Everybody gets a little. It is possible those today that the carrier could either put a deductible on your policy or are charges surcharge. If you have an excessive numbers of suits and it is possible that. Individuals position might be penalized. If saying paralyzed numbers -- it's it's one of the frustrations because. He can be suit have been sued many confrontations than ever sought because as the primary care physician. When a patient checks into hospital any hospital one of the questions they put on the facies who's your primary care doctor. Well the child or patient goes into the ER they've seen by the ER physician and the whole case is handled within the hospital itself. But because my name is on the cover sheet as the primary care. Every name in the chart its suit and he got to spend money to get yourself out of the -- even though you never saw the patient. And those add up after a loss prevented and and so it begins to head against your -- that year carriers are looking. You know it's like the Florida insurance issues even fly it three times. They're really looking at the fact that you leadership mover ranger house otherwise you're not Kabila had the insurance anymore. So it's assimilation of the total number of cases can affect an individual but the general fact is the more suits there are the more of the rates go up for Africa. OK stay with -- we're gonna continue our talk on malpractice right after this while we -- back talking with doctor Floyd purist and doctor meant a lot about. Malpractice insurance and and really that world that has changed quite a bit and yet in Louisiana for the most part it is. It's been done very well and I'm always happy to -- when we do something right. Before we go to the next thing I wanted to as I think we all understand it. More and more. Your fees are dictated either buying government. It's Medicare Medicaid or insurance agent insurance companies. And I'm just wondering if they are if I have that much influence. But essentially on your income. Why are they responsible for paying -- malpractice insurance. Well it's an individual issue and that's that's one of the problems with. Particularly physicians who take Medicare Medicaid. -- and and really it's a reimbursement -- let's fix by the government exactly charge a million dollars -- visit and I'm gonna get fifty because the government says you're gonna get. Fifty. On the way out here. -- if the reimbursement is fair -- its fixed by the government but the race for insurance -- variable linking a lot based on numbers of claims. I have no mechanism. By which to. Pay that increased premium. -- it as opposed to sand gas station with the price of gasoline goes up the the gas station owners simply puts a high number up on the pomp that you pay. But that price of malpractice insurance could double. And yet I would not yet higher reimbursement from the government for the -- that something has to be cut. And what has to be cut his service -- if he can't get more revenue for what you're doing all you can do is cut cost. And that's where this fixed fee schedules are fixed reimbursement tables that the government uses. Are are not conducive to a good malpractice environment. Because. If the premiums go higher and higher and higher in the reimbursements don't go higher -- gonna squeeze physicians now. And that's a number of physicians use that as the reason -- retire. Is they just can't close that gap. The between what their compensation is for the services that they. Provide and the cost that it is to provide the services. We talked about that earlier on another show just talking about. I just. Feel like the government is telling you too much. About what you should be the one value you should be able to say this service that I do Kostis. Not a third party entity telling dictating. The government would tell us that in the formulas that they use. To determine -- payments forgiven procedure. They build in and part of it is the cost of professional medical liability. The problem is is that we've been having the sword of damocles hanging over the heads of the president's position. Profession. Because they've got potentially 21%. Cut coming because of the budget neutrality acts under the first Bush Administration. And we have not been able to implement them because if congress implements those cuts they know they'll be a wholesale death. Defection from the Medicare rights and then mount more and more of the private insurance is our being are paying us a percentage. Of Medicare rates they're basing their reimbursements on the Medicare reimbursement so it's all tied in together. Again I think it was out of Pearson said -- are we gonna see the march of the white coats a Pennsylvania Avenue I still envision it. But let's talk about one area in when we speaking about the commercial very briefly. What is the problem. With our system. Well I think it depends on how you look at it and I think that if you were appointed attorneys that we shouldn't have a cap which it emblems of what bill. But I think as as a person I'm personally have set on the patience compensation fund oversight board since 2011. And and and that worked very hard for them to make this viable and -- we've closed the gap we have no unfunded liability. We have the assets to pale claims the problem we sees that we are not fairly compensating people because of the delay. We opened and closed about 16100 claims a year at the patience compensation fund. And we have about 4800 open claims right now. Well that would tell you that the bulk of those claims are very old -- actually we have claims going back into the eighties. And the problem is is that those victims of medical negligence. Those claims where if their ballots have not been eight. It's very difficult to be able to do that because. In the state system the first 100000 is either by self insurance or buy insurance policy. And the patients compensation fund can -- get involved. Until that his first 100000 is resolved. Then the patience compensation front can move in settle the claim a fairly. With the delays with the problem is and we have no real solution to that is totally caused. It can be caused by the plaintiff attorney wishing to not settle the case eminently. He can because by -- Plaintiff who doesn't cooperate with the plan for turning. It could be caused by the defense -- many defense council states just let this case on -- the patient die and we disclaim logo like. Nonetheless these open claims. Patients and if cameras and not being compensated. For their injuries if there very valid but the problem is if they don't settle claims at -- 100000 dollar level. The payments that need to be made it in me. Of those about the -- yes now that's a trend just stay with us we're gonna continue our conversation right after that. We're talking with that two doctors -- know an awful lot about malpractice and and really for the future what -- hoping hoping for. To sort of fine tune things would be what you just mentioned. Well we've talked about some some as a solutions which might have put more reasonableness and our predictability in the cost. Wanted to be for example to -- to fix. Compensation. Fees for for the attorneys and work off of the schedule as opposed to a percentage of the award. Right now the bigger the award the bigger the amount of dollars an attorney could saddle. Could get in India as fees whereas if they worked -- of a fixed compensation -- They might be motivated to settle these cases faster and that addresses the problem and then run -- and -- haven't been fighting hand with the best earnings. -- most successful contingency fee limiting noise the California medical liability act. And at the -- micro MI CR right. And there is a scale sliding scale as the award goes up the percentage of recovery in the contingency fee goes down. And that's been the most success. Well I cannot thank you both enough for talking about this we only to be educated at this this is a very interesting time -- -- lives with -- Changing and health care we need to know about these dollars I think both the view. We're now joined our newsroom with. -- --