Physician Characteristics Prone to Malpractice Claims

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2 Responses


    Beginning in the 1970s, according to my friend and colleague ROBERT JAMES CIMASI; MHA, ASA, FRICS, MCBA, AVA, CM&AA, CMP™ [Founder and CEO HEALTH CAPITAL CONSULTANTS LLC]; the perception of malpractice claims as a growing problem emerged. Eighty percent of the total number of medical malpractice suits filed between 1935 and 1975 were filed between 1970 and 1975. Along with the rise in the number of claims during the 1970s, malpractice insurance premiums also increased. As a result of these increases, several states passed tort reform legislation in the mid-1970s, while, during the same period, several physician-owned insurance companies were created in an effort to contain premiums. After a brief respite, the 1980s experienced new premium increases and an increase in large jury verdicts.

    Although there were increases in large jury verdicts, the insurers’ monetary losses did not amount to what was predicted by their actuaries, resulting in high reserve rates entering the 1990s. Insurers used these high reserve rates to engage in high investment returns that allowed insurers to increase their income profitability and grow their market share at the expense of their reserve rates. Further, the growth in market share allowed insurers to keep their premium rates growing at a flat rate, sometimes even decreasing, throughout much of the 1990s. However, these behaviors by insurers kept an increasing amount of losses hidden. By the mid-to-late-1990s, much of the excess reserves of insurers were depleted, with income from investments falling below expectations and profitability declining.

    A common theory the 1990s was that the influx of frivolous lawsuits, and the concept that insurers had to settle them to make them go away, were causing premium rates to increase at a rapid pace. However, to this day, many insurers insist that they do not settle “frivolous lawsuits.” Additionally, the high cost of litigation has served as an entry barrier to the justice system, since patients may find it difficult to secure legal representation if there is not a reasonable expectation of a large payment. In a 2014 survey published in the Vanderbilt Law Review, lawyers stated they cannot accept claims that do not have the potential to earn $250,000 or more because it is not economically feasible. The predicted result of this epidemic is that roughly 95% of potential medical malpractice plaintiffs will have a difficult time finding legal representation unless their anticipated damages are substantially more than what is typical for their type of injuries. Data from Physician Insurers Association of America (PIAA) has reinforced this concept, specifically showing that the number of payments to defendants that were below $250,000 in 2010 was less than half the number of payments that occurred during the 1980s, when there was a peak in the number of litigation payments. Similar the decrease in the number of lower payments, the volume of tort cases declined 25% between 1999 and 2008.

    Despite the decrease in medical malpractice cases and frivolous lawsuits, insurance premiums have continued to rise and fall at uneven rates. Using data compiled from the Medical Liability Monitor’s Annual Rate Surveys from 1991 to 2014-15, the increase in premium rates across all types of plans; however, the overall increase in price is also marked by periods of year-to-year price decreases followed by steep price increases.

    While factors such as large jury verdicts, frivolous lawsuits, and inadequate physician practice typically receive the bulk of media and public attention, other less documented factors – most notably the behavior of medical liability insurers – significantly contribute to the fluctuation in the price of malpractice premiums. The critical stakeholders in this debate (e.g., medical liability insurers, physicians, and consumer advocacy groups) have firmly entrenched positions that give the tort reform debate its current focus; however, this entrenchment may also limit the focus from discovering the underlying influences on malpractice premiums and how new stimuli can influence prices. Arguably, by turning away from the “headline” causes for tort reform and focusing instead on the complex, multivariable nature of medical malpractice, more sound policy perspectives might be developed and considered in the tort reform debate.

    Your thoughts are appreciated

    Dr. David Edward Marcinko MBA CMP™


  2. Email Does Not Toll the Statute of Limitations for Malpractice: NY Court

    In Caesar v. Brookman, 800004/15, NYLJ 120275458584903, at 1 (Sup. Ct. New York County March 30, 2016), Justice Alice Schlesinger was faced with the sole question of whether advice contained within emails constituted “continuous treatment” as applicable to the statute of limitations in podiatric malpractice actions. She answered this question in the affirmative.

    Plaintiff presented to defendant, a podiatrist, with a possible foreign body in his right heel; defendant found a shard of glass in the heel which he removed, and then cleansed and dressed the resulting wound. Two days later, plaintiff sent defendant an email detailing various symptoms he experienced since his office visit. Defendant responded by email that same day advising that “plaintiff could leave the wound uncovered, it was unlikely his fever and chills were from the wound, and recommended he take antibiotics.” Two days later, plaintiff was admitted to the hospital with an MRSA infection. Justice Schlesinger’s holding in Caesar clearly conveys to physicians aiming to decongest their waiting rooms by treating patients in cyberspace that there will be consequences of doing so.

    Source: Ellen H. Greiper and Scott P. Eisenberg, New York Law Journal [5/31/16] via Dr. Phil Obiedinski


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