Avoiding a trial through arbitration or mediation

Alternative dispute resolution (ADR) involves alternatives to jury trials as a means of resolving legal disputes arising out of allegations of medical professional negligence. The two primary alternatives to jury trials in the medical liability arena are mediation and arbitration.

Why use ADR?
Comedian Norm Crosby once said, “When you go into court you are putting your fate into the hands of 12 people who weren’t smart enough to get out of jury duty.” He was right on several counts. In some locations, as many as half of those summoned for jury duty simply refuse to show up. Studies have shown that those who do appear are often angry at the inconvenience and the amount of time involved (especially in medical liability cases), and that their anger is often manifest in the verdict, producing widely variable and unpredictable results. Most jurors simply are not capable of understanding the medical issues involved in these cases.

As a result, cases are decided on peripheral issues that have nothing to do with the facts, the medicine, or the law. Additionally, a recent article in The Atlanta Journal reinforced what many of us have believed for years. During one jury trial, the judge learned that one of the jurors had been doing Internet research on the medical issues in the case, which, of course, is strictly forbidden. The judge intended to excuse that juror, replace the juror with an alternate, and allow the trial to proceed. Upon further inquiry, however, the judge discovered that seven other jurors had also been doing Internet research on the medical issues in the case. Despite strict instructions from the court, more jurors are choosing to become “experts” on the issues and are bringing into the courtroom information never presented within the rules of evidence.

The role of geography in determining the outcome of medical liability cases is another reason to choose ADR. Counties within every state have vastly different historic patterns in jury verdicts. Some counties are extremely conservative. In one Georgia county, only one medical liability verdict has been returned against a physician in the last 35 years, and that verdict was very modest. By contrast, in a nearby county, extremely large medical malpractice verdicts are routine and almost expected. Virtually identical fact patterns can produce extremely disparate results depending upon where the case is tried.

The cost of getting a medical malpractice case to trial is astronomical. Expert witness fees, deposition costs, the cost of securing and organizing voluminous medical records and medical illustrations, and other costs can result in out-of-pocket expenses that would be prohibitive for many plaintiffs, and a significant factor for malpractice insurance carriers. The plaintiff can pay these out-of-pocket costs only when and if the case has a successful result.

Time is an equally significant factor. In some jurisdictions, cases can be prepared and tried relatively quickly. However, it is not unusual to be trying a medical liability case 5 years or longer after suit is filed. If the verdict is appealed, the time can be extended an additional 18 months to 3 years. An appellate decision may require that the case be retried.

As a result, medical liability cases have become a gauntlet and an endurance contest that, when combined with the unpredictable results, make ADR an increasingly more palatable option.

The advantages of ADR
The ADR options remove many of these concerns. Mediation is participatory, meaning that the litigants not only have a voice, but an actual vote in the ultimate outcome. Likewise, mediation is voluntary, meaning that although mediators may and often do express their opinions, neither party can be forced to settle a case at mediation. Mediation is not perfect because usually one party leaves with less than they hoped to get, and the other leaves paying more than they wanted to pay. It is, however, quick, cost-effective, informal, and final.

Like mediation, arbitration also has desirable characteristics. It is cost-effective, typically final, and, although not as participatory, has mean results that are vastly more predictable than a jury trial.

Both mediation and arbitration eliminate the previously mentioned vagaries and pitfalls of jury trials. They eliminate the exorbitant costs to the plaintiffs and the years it often takes to get to trial. They also tend to weed out extreme results and those based on peripheral issues that have nothing to do with medicine.

Obstacles to implementing ADR
Both plaintiffs and physicians can find reasons not to participate in ADR. Plaintiffs may be agreeable to mediation because they are committing only to participate and listen. If the mediation is successful, the case is concluded. If the case is not successful, the plaintiff has lost very little in terms of cost or time.

Arbitration is a somewhat harder sell for plaintiffs. Historically, plaintiffs have had a better chance of a “home run” with a jury verdict than with an individual arbitrator or a panel of arbitrators. Nonetheless, some movement toward arbitration in medical liability cases is occurring as cost and time become increasingly important factors.

Physicians may also be reluctant to agree to mediation or arbitration. Professional liability policies with “consent to settle” clauses require the physician to consent to any settlement that prevents the insurance carrier from unilaterally settling the claim. These clauses originated out of physicians’ concerns for their reputation and the desire to defend the care they rendered. Confidentiality agreements (clauses in the settlement document making the terms of the settlement confidential) have been of some assistance in reassuring physicians and securing their consent to settle. Because both the facts and the terms of settlement usually emerge, however, confidentiality agreements have not been very effective in reassuring physicians.

A larger obstacle involves reporting requirements. At the Federal level, any settlement by a physician of a medical liability case is reported to the National Practitioner’s Data Bank, which is accessible to the public. Reporting requirements and disciplinary structure of state medical boards vary from state to state. These mandatory reports are also accessible to the public and may result in hearings before medical board committees and the imposition of disciplinary measures.

A creative approach is needed that strikes a balance between the public’s “right to know” and the profession’s need to monitor the quality of health care on the one hand, and the physician’s concerns for privacy on the other.

The future of ADR in medical liability cases
Predicting the role of ADR in medical liability cases in the future is difficult. The obstacles are real, and the solutions elusive. The difficulties of resolving medical liability cases by jury trials are equally real and becoming more pronounced as the filings in an already overburdened court system increase.

A push to ADR is coming from the courts themselves, which are making mediation mandatory. Although this does not guarantee a resolution of the case, parties that initially appear at mediation under court order frequently buy into the process and resolve the case.

Although making arbitration the exclusive vehicle for resolving medical liability disputes has been discussed, it no longer seems politically feasible, leaving either voluntary mediation/arbitration or court-ordered mediation as the best alternatives to a jury trial for resolving medical malpractice disputes. One can be optimistic, however, considering the growth in both voluntary and court-ordered mediation.

Thomas E. Greer, JD, is a practicing attorney in Carrollton, Ga., who handles a range of civil jury trials, including medical liability cases. He is a member of the Georgia Academy of Mediators, and prepared this article at the request of the AAOS Medical Liability Committee.

The difference between mediation and arbitration
In mediation, the plaintiff and the defendant physician or physicians select a mutually agreeable individual (or individuals) to serve as the mediator. The mediation session convenes with the mediator, the plaintiff’s attorney, the plaintiff, the medical defendants, and the defendants’ attorneys present. The mediator explains the mediation process and the ground rules. The attorneys make a short version of what would be an opening statement in a jury trial setting.

The parties then move into separate rooms with the mediator moving back and forth to facilitate a resolution. In most states, if a pending suit exists and a mediated settlement is reached, once the agreement is reduced to writing and signed by the parties and their attorneys, it becomes binding and enforceable by the court.

In arbitration, the parties to the litigation, by mutual agreement, select an individual or panel of individuals (usually three) who decide the case. If a panel is used, each side will nominate one arbitrator, and those two arbitrators will select the third. In the arbitration setting, both sides are free to call witnesses and introduce documents and other exhibits, similar to a trial of the case. The rules of evidence are more relaxed, however, and the atmosphere is much more informal than in a jury trial setting.

Once both sides have presented their evidence, the arbitration is adjourned. Within a few days, the parties will receive a written decision from the arbitrator or the arbitration panel. Arbitration usually requires the parties to waive the right to an appeal, making the decision of the arbitrator(s) binding and final.

Editor’s Note: Articles labeled Orthopaedic Risk Manager are presented by the Medical Liability Committee under the direction of contributing editor Douglas W. Lundy, MD.

Articles are provided for general information and are not legal advice; for legal advice, consult a qualified professional.

E-mail your comments to feedback-orm@aaos.org or contact this issue’s contributors directly.