Tort reform yields sharp drop in med-mal for TN; could be temporary
Tort reform yields sharp drop in med-mal for TN; could be temporary
Experience may hold lessons for other states seeking reform
Risk managers across the country cheered when they heard of dramatic decrease in the number of malpractice lawsuits filed in Tennessee after reform efforts there, wondering if the same experience might be replicated in their own states. The results are encouraging, say the analysts consulted by Healthcare Risk Management, but it still is not clear whether the decrease is temporary or will be a lasting effect.
The initial experience with Tennessee's malpractice reform has been positive for health care providers, says Craig Sanders, JD, a partner with the law firm of Rainey Kizer in Jackson, TN, where he represents health care systems in malpractice litigation. Statistics from 2009 suggest that the state is climbing back from the darkest days when the American Medical Association (AMA) declared the state to be a medical liability "crisis state."
On Feb. 14, 2006, the AMA announced that Tennessee was the 21st state designated by that organization as "in crisis" due to a deteriorating medical liability climate that was jeopardizing patients' access to care. The AMA urged state legislators to enact reforms, noting that from 1995 to 2005, Tennessee physicians saw liability premium increases as high as 127% to 212%. The high cost of liability insurance was pushing many physicians to relocate to other states, leaving many communities without needed specialists, according to the AMA.
State legislators listened and passed a tort reform bill in 2008. Rather than enacting caps on damages, which may have prompted more resistance from tort reform opponents, the legislature created provisions intended to make it more difficult for patients to sue health care providers, Sanders explains. Under the 2008 law, plaintiffs now must give 60-day notice before filing a malpractice suit, and they must provide a certificate of merit from a medical professional stating that the allegations are legitimate.
The reform provisions were in effect for the entire year in 2009, and the results indicate that they are indeed acting as speed bumps for plaintiffs. Though state agencies and legal organizations have reported conflicting numbers, with the most common statistic being a reduction of 60% in the number of suits filed, Sanders says attorneys in the state agree that the number of medical malpractice cases has dropped sharply.
"I've heard different numbers as to how much the filings have dropped, but I can tell you from the front lines, it has been a significant decrease," Sanders says. "I think plaintiffs' attorneys, some of them, saw the amendments and just said it's getting too complicated. They didn't want to make a mistake and get sued for malpractice themselves. So, I think some of the attorneys who were on the periphery, filing a malpractice case every once in a while, just stopped filing them altogether."
Sanders suspects that the requirement for a certificate of merit has had more impact than the 60-day notice rule. Previously, there was no impetus for plaintiffs' attorneys to seek a confirmation that the case had merit, so they waited until well into the litigation process to procure expert opinions.
"It would have been good practice to do that early on, but in reality, not all attorneys were doing that," Sanders says. "Those practitioners either got out of malpractice work or they saw the number of their cases decrease significantly when they started asking medical professionals if their cases had any merit. They started seeing the warts and the problems in cases they might have just filed without question before the amendments."
The drop in cases has not yet been reflected in the cost of malpractice insurance for health care professionals, however. Insurers may be waiting to see if the number of cases will remain low, he says. And their hesitation may be warranted, as Sanders explains that the significant decrease in malpractice suits could be temporary.
"We have to think about whether this is a permanent decrease. Many people assume it is, but I'm not so sure," he says. "I think there will be some increase, but the big unknown is how much. The numbers may not go back to the former levels, but I expect to see some increase."
Artificial dip in numbers?
A major reason Sanders expects some rise in the number of cases is that the extent of the decrease in 2009 may have been exaggerated by the way plaintiffs' attorneys rushed to file cases before the tort reform took effect. Attorneys filed all their current cases as quickly as they could in 2008, so they would not have to comply with the new rules in 2009, Sanders explains.
"That meant the numbers went up in the latter part of 2008, down in 2009, and the difference looks even bigger," he says. "I also suspect the number of cases may increase as plaintiffs' attorneys get used to the new rules. The amendments weeded out some who didn't want to bother with the added requirements, and probably more have put on the brakes temporarily. But I think over time they will get used to working with the rules, and they will get more aggressive."
Neil Ekblom, JD, a health care attorney with the law firm of LeClair Ryan in New York City, also questions whether courts in Tennessee will water down the tort reform rules over time. New York state also requires a certificate of merit, but court rulings have diminished the rule's impact, he notes.
"Courts took the teeth out of it, because it was interpreted as a ministerial or technical requirement, which if not followed to the letter did not warrant dismissal," Ekblom says. "We also had a dip in the number of suits when a certificate of merit was required, but then that number went back up to normal once the courts interpreted the statute in a liberal fashion."
New York state also requires a 90-day notice, similar to the 60-day notice in Tennessee, and Ekblom says that statute has been interpreted more strictly. There are still exceptions that weaken the impact, however.
"The courts here are very antsy about depriving plaintiffs of their day in court on a technicality, and you probably will see the same thing in Tennessee," he says. "Both of these provisions will lose their teeth over time, and the number of suits will come back up again. It is not enough to have these laws on the books. It's about how they are interpreted, and that can change over time."
Impact may be limited
Ekblom points out that the certificate of merit also has limited impact when, as in New York, any physician can declare the case to have merit, even if that physician is in a different specialty or otherwise has no expertise in the case at hand. In addition, the Supreme Court of the state of Washington recently struck down the statute requiring a certificate of merit there, causing some attorneys to wonder if similar rulings might follow in other states.
Stuart Ratzan, JD, managing shareholder with the law firm of Ratzan & Rubio in Miami, who specializes in medical malpractice cases on the plaintiff side, doubts that either of the Tennessee provisions will result in long-lasting declines in medical malpractice cases.
"Most cases, in almost every state, require the plaintiff to retain someone who can testify at trial that there was negligence. There is very little incentive for any lawyer to initiate and pursue a case for someone unless it is a merit-worthy case, particularly for those working on contingency," he says. "From a business point of view, it should be a good case with merit, or else he's going to lose his shirt."
At best, Ratzan says, the certificate of merit moves up the deadline for getting an expert witness who can certify the case is based on a reasonable allegation of malpractice.
"I don't see the certificate of merit being a trigger for a substantial decrease in the number of malpractice cases filed," he says. "It may be that Tennessee slowed it down as people had to get used to the new system, but I don't expect a huge impact in the long run."
Expecting to see a lasting effect, even if not as good as 2009, Sanders says the important lesson from the Tennessee experience is that damage caps are not the only way to enact tort reform. Other, less contentious strategies may be more effective.
"Sometimes reform ideas, like caps on damages, can't pass because of the politics in the state. But other ideas, like the certificate of merit, can get passed, because both sides of the political spectrum can get behind it," Sanders says. "I think what we've seen in Tennessee is that the less grandiose ideas can still have a substantial effect, and in the end, that is more productive than pushing for something that may never get through the legislature."
Sources
For more information on malpractice tort reform, contact:
Craig Sanders, JD, Partner, Rainey Kizer Reviere & Bell, Jackson, TN. Telephone: (731) 425-7955. E-mail: [email protected].
Neil Ekblom, JD, Attorney, LeClair Ryan, New York City. Telephone: (212) 430-8031. E-mail: [email protected].
Stuart Ratzan, JD, Managing Shareholder, Ratzan & Rubio, Miami. Telephone: (305) 374-6366. E-mail: [email protected].
Risk managers across the country cheered when they heard of dramatic decrease in the number of malpractice lawsuits filed in Tennessee after reform efforts there, wondering if the same experience might be replicated in their own states.Subscribe Now for Access
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