Illinois Declares Med Mal Cap Unconstitutional

The Illinois Supreme Court struck down a State law that set caps on noneconomic (pain and suffering and mental anguish) damages.  That law placed a cap of $1,000,000 on noneconomic damage awards against hospitals and $500,000 against physicians.  The court held that the law violated the separation of powers article of the Illinois Constitution in that it was a legislative attempt to infringe upon the inherent powers of the judiciary branch to decide these cases on a case-by-case basis.

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Owning Up to Errors May Actually Benefit Hospitals

The Wall Street Journal (“WSJ”) reports on a medical error case arising at Baptist Children’s Hospital in Miami.  An 18-month old child suffered a severe brain injury when her breathing tube became dislodged while she was under sedation for an MRI.  The hospital quickly owned up to the mistake, settled the case with the family and immediately instituted new measures to prevent future similar mistakes.  Then, the hospital engaged the child’s parents in educational efforts with the medical staff to underscore he importance of patient safety.  They even went so far as producing a 15 minute video to internally educate the staff about the events leading to the child’s injury.  The mother of the child now serves as a community liaison on the hospital’s quality and patient safety committee.  The family did not sue the hospital.

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Federal Analysts Believe Rate of Medical Errors Increasing a Decade After Prominent Study

In November 1999, the Institute of Medicine (“IOM”) issued a comprehensive report, authored by 22 top medical experts, titled “To Err is Human” in which it  concluded that approximately 98,000 people die each year from preventable medical errors.  Recently, a national investigation led by Hearst Newspapers, including the San Francisco Chronicle, found that the federal government, most states and the hospital industry have failed to take the recommended steps in that report to lower these figures and provide safer hospitals. 

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The Synthesis Project Analyses Medical Malpractice Insurance

The Synthesis Project recently released a report entitled Understanding medical malpractice insurance: A primer.   The Synthesis Project is an initiative of the Robert Wood Johnson Foundation to produce relevant, concise, and thought provoking briefs and reports on today’s important health policy issues. This particular report, Report No. 8, is authored by Dr. Michelle M. Mello, of the Harvard School of Public Health.

In the report, the authors note that several important shifts in the liability insurance market affect the cost of malpractice insurance paid by health care providers. These factors include:


             -Exit of some commercial carriers and the advent of physician mutuals (physician owned companies)

            -Problems obtaining affordable reinsurance after September 11

            -The growth of hospital self-insurance

            -Shift from occurrence policies to claims-made policies

            -Increasing interest in hospitals buying insurance for doctors

            -The growth of joint underwriting associations

            -Relatively poor returns on investment since 2000


Conspicuously absent from this listing is the greedy insurance company mantra that trial lawyer medical malpractice verdicts are the reason these insurers are raising their rates on health care providers. In fact, the study reports that with regard to claims frequency there is no evidence that an increase in the number of malpractice claims has contributed to the current malpractice insurance crisis. Significantly, the source for this statement came from statistics obtained from The National Practitioner’s Data bank, a federally funded site that tracks every malpractice payout made by any entity on behalf of a physician. 


            Also noteworthy in this study is the analysis on how medical malpractice insurers actually go about setting their premiums. According to the report, insurers set premiums on a prospective basis based on four (4) separate criteria: (1) their expected payouts for providers in a particular risk group; (2) the uncertainty surrounding this estimate (3) their expected administrative expenses and future investment income; (4) and the profit rate they seek. 

The report notes that medical malpractice insurers do not set their premiums like those who provide automobile insurance. Automobile insurers use an experience rated basis to set premiums.


When an auto insured has a claim, his insurance goes up. Thus, an individual is accountable for his own claim’s experience and corresponding premiums. In the medical malpractice arena however, premiums are priced by the specialty, regardless of a particular physician’s claim’s history. Thus, good doctors pay for bad doctors’ mistakes. This inequitable basis for determining premiums is driven by the insurance companies’ profit motives. Past experiments with using a more equitable model like the auto insurers have used have resulted in a less stable estimate of the insurer’s risk, and thus correspondingly lower profits. 


Insurers always want to focus the medical malpractice insurance debate on only one of the four elements used to set rates: the one based on payouts for a particular risk group. However, since claims frequency has not risen in real terms over the past 10 years, the other three elements used to set rates account for increased premiums. Where is the debate concerning the unreasonably high profit rates, poor investing and high administrative costs of these insurance companies. 


The recent horror citizens have had to endure with their insurers following the natural disasters, including Hurricane Katrina, are finally exposing insurers’ profiteering at the consumer’s expense.

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Medication Errors Still Abound in U.S. Hospitals

Many recent articles and studies have been written about the ever increasing number of medication errors that injure patients each year. Recently,  U.S. Pharmacopeia, (“USP”), a private group that sets standards for the industry, released its MEDMARX report.  The MEDMARX report analyzed records from 1998-2005 for adults, geriatric and pediatric patients. MEDMARX was founded in 1998 and since then has received 1.2 million reports of medication errors from more than 870 healthcare facilities across the U.S. It utilizes an anonymous, Internet-accessible program to report, track and analyze medication errors.

The MEDMARX report  found that patients who undergo surgery face the greatest risk of becoming a victim of a medication error. According to the MEDMARX report, more than 11,000 medical errors in the perioperative setting revealed that approximately 5% of the reported medication errors resulted in harm, which included four deaths. Significantly, this percentage of harm is more than three times higher than the percentage of harm among all MEDMARX records. More significantly, children suffered the highest risk with nearly 12% of those medication errors resulting in harm. Most of the reported errors involved the use of antibiotics and pain killer medications. The most commonly reported medication mistakes involved giving the wrong amount of medication, giving the medication at the wrong time, omitting a dose of medication, or administration of the medication incorrectly. 

As part of its program, USP even offers tips for consumers to help avoid medication errors in the surgical setting. Among these tips, USP advises patients to inform the surgical staff of known food or drug allergies (no matter how insignificant); bring a list of prescription and over the counter medications that you are taking on the day of your procedure; mark your surgical site with your healthcare provider; make sure your chart goes with you to the operative suite. 

USP also provides recommendations to the healthcare providers to help reduce the incidence of medication errors. Some of these recommendations in the operating room include:

  • Requesting that institutions and professional associations call upon manufacturers to produce drug products in ready-to-use packaging with sterile, duplicate labels to avoid errors with labeling. As soon as commercially available, hospitals should obtain as many products as possible in sterile, ready-to-use packaging;
  • Forming a multidisciplinary team to periodically examine preference cards (physician requirements for a particular procedure) to ensure appropriate use of abbreviations or acronyms, ensure clarity of medications intended for the procedure, and affirm instruments and equipment needed for the case; there should also be evidence of the last date the card was reviewed;
  • Providing practitioners with access to accurate patient information, standardized dose charts, and/or assistive technologies with proper medication calculations and formulations so no patient will be at risk of receiving the wrong dose;
  • Expanding the “time-out” standard to allow sufficient review of the preference card and confirmation of the medication directions, patient allergies, and preprocedural antibiotics; and
  • Ensuring that practitioners adhere to the safe medication practice of “repeating back and visually identifying the product” during hand-off between the circulating nurse, scrub personnel, and surgeons.


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Insurance Regulators Usually Come From Within The Insurance Industry

In a recent article in the Kansas City Star, the author found that Insurance Regulators and Insurance executives routinely trade jobs through a "revolving door."  In an informal nationwide survey conducted by the newspaper, One-third of the new insurance commissioners came from the insurance field.  Moreover, more than half of the 35 insurance commissioners who left their jobs in the last three years procured new jobs with the insurance industry or groups that work for the insurance industry.

According to the Kansas City Star:

"Insurance companies have far deeper pockets, and far greater political pull, than consumers might ever dream of -- and their influence is considerable.  The reason is simple.  Big money is at stake.  Insurance premiums now equal roughly 10 percent of the U.S. gross domestic product."

Doug Heller, director of the Foundation for Taxpayer and Consumer Rights, a non-profit California advocacy group was quoted

"The industry (insurance) gets what it wants across the country"

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Medical Malpractice Caps are Unwarranted by the Payout of Claims Data

Each year, the debate in state legislatures around this country regarding the so called need for tort reform and caps on medical malpractice cases intensifies. Big medical corporations and insurance companies, who are only motivated about increasing premium revenue and decreasing payments to victims, lead the fight with big dollar lobbying campaigns.  Unfortunately, these lobbying efforts rarely contain accurate facts and figures and in the end, leave innocent victims of malpractice with little or no recourse for even blatent acts of malpractice.

One of the favorite arguments of the proponents of caps of damages is the alleged increased cost of physician premiums which they erroneously suggest  are caused by big money payouts.  However,  published statistics for state health facts and figures debunk this myth.  The website, sponsored by the Kaiser Family Foundation, reports that in the year 2005, the average medical malpractice payment totalled only $290,982 for the 14,021 reportedly paid claims.  Highlights of this state by state breakdown on the number of paid claims showed that New York led the nation with 1,768 paid claims and was followed by California (1,117), Florida (1,095), Pennsylvania (1,061), and Texas (1,018). 

Many states were well below the small national $290,000 payout.  Louisiana, which had 299 paid claims in 2005, only averaged $185,897 per paid claim. Similarly, Texas only paid an average of $182,795.  Michigan, which paid 451 claims averaged $130,412 per payout.  South Carolina averaged $161,092 on 171 paid claims.

These documented facts and figures, compiled by an independent and reliable source, certainly dispell the notion that medical malpractice payouts in this country each year are not "runaway verdictsor payments" that require special legislation to "reel in the trial lawyers." 

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Studies Show That Hospitals Can Do More To Avoid Infections

The Washington Post has recently reported on three new studies relating to infections acquired in hospitals.  In its article Studies: Hospitals Could Do More to Avoid Infections, the Post states that the studies show new evidence that hospitals could prevent many of the growing number of infections that afflict patients nationwide each year.  The studies were published in the American Journal of Medical Quality.  Its editor, David B. Nash commented on the findings: 

"These three groups independeltly found that despite hospitals'claim that in the sickest patients it's inevitable that someone is going to get a hospital-acquired infection, that's just not the case"

Nash, who is also the Chairman of the Department of Health Policy at Thomas Jefferson University in Philadelphia, states:

"[H]ealth professionals should do more to promote hand-washing among medical staff, take greater care in donning gowns ans other infection-preventing clothing during medical procedures, reduce traffic in and out of operating rooms ,isolate patients when necessary and use antibiotics more selectively."

The three studies reported in the American Journal Of Medical Quality were from Allegheny General Hospital in Pittsburgh, Cardinal Health, Inc, in Massachusetts, and Professor Christopher Hollenbeak, surgical department, Penn State College of Medicine respectively.  Dr. Hollenbeak's study examined Pennsylvania's data for more than 180,000 surgical patients and found that hospital practices such as hand-washing, the duration of surgeries and traffic through the operating room played a greater role in hospital based infections.  The Allegheny Hospital and Cardinal Health  studies respectively demonstrated that there are financial advantages of reducing infections and the severity of the effects of the infection could not be attributed to how sick the patient was at admission.

Nancy Foster, vice president for quality and patient safety at the American Hospital Association agreed that more hospital infections are preventable:

"[t]he new wave of research is showing that our previous expectations around what was preventable underestimated what we could actually achieve."

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