Published 11/1/2009
Stuart L. Weinstein, MD

Medical liability reform: Back on the table

President Obama, AAOS take steps in the right direction

In his speech to Congress on health care on Sept. 9, 2009, President Barack Obama recognized that medical liability issues were leading to increasing healthcare costs. In this public forum, the president stated, “I have talked to enough doctors to know that defensive medicine may be contributing to unnecessary costs. So I am proposing that we move forward on a range of ideas on how to put patient safety first and let doctors focus on practicing medicine.”

The president directed the Secretary of Health and Human Services to award demonstration grants for the development, implementation, and evaluation of alternatives to the current medical liability system. Subsequently, other Democratic party leaders—including Senate Majority Leader Harry Reid (D-Nev.) and House Majority Leader Steny Hoyer (D-Md.) have both talked about the problems of the current system, including excessive jury awards and frivolous lawsuits.

The issue of medical liability reform has traditionally been a wedge issue between Republicans and Democrats. During the previous administration, medical liability reform was a high priority. Medical liability reform legislation passed the House of Representatives several times, but never successfully negotiated the hurdles necessary to pass in the Senate.

Currently, the Senate Finance Committee’s proposal for healthcare reform (the one most likely to be the “blue print” for the final legislation) includes only a “sense of the Senate” on medical liability reform, stating that state demonstration projects should be considered.

The economic impact
More information on the wasted healthcare dollars spent on defensive medicine is becoming available. Consider the following facts:

  • According to a recent PricewaterhouseCooper’s Health Research Institute Survey, defensive medicine practices added up to nearly $210 billion per year in wasteful spending, the highest amount of waste in healthcare spending.
  • The average American family pays an additional $1,700 to $2,000 per year in healthcare costs simply to cover the costs of defensive medicine.
  • Excessive litigation and waste in the nation’s current tort system impose an estimated yearly tort tax of $9,827 for a family of four and increases healthcare spending in the United States by $124 billion.
  • If the average obstetrician/gynecologist (OB/GYN) delivers 100 babies per year and pays an annual medical liability premium of $200,000 (the rate in Florida), $2,000 of delivery costs for each baby goes to pay for the cost of the medical liability premium.

Although recognition by the president and congressional leaders is a step in the right direction, neither the “Sense of the Senate” verbiage in the Senate Finance Committee’s healthcare reform document nor the President’s request for demonstration project grants is enough. States have already been engaged in “demonstration projects” on medical liability reform for years. Many have already enacted reforms that have a proven record of success.

Revised AAOS Position Statement
The AAOS Medical Liability Committee, under the direction of Douglas W. Lundy, MD, has been constantly monitoring the medical liability playing field on both the federal and state levels. A subcommittee under the direction of S. Jay Jayasankar, MD, recently revised the AAOS Position Statement on Medical Liability Reform, which was approved by the Council on Advocacy and adopted by the AAOS Board of Directors in September.

The current medical liability system poses many challenges including the following: failing to compensate injured patients in a timely manner; interfering with and often altering the doctor-patient relationship; preventing analysis of medical errors and system improvement; increasing the use of “defensive medicine” with its associated increased healthcare costs; and reducing access to care by decreasing physician supply and triggering changes (such as eliminating trauma care or high-risk surgeries) in existing physician practice patterns.

In part, the new position statement reads as follows:

The AAOS strongly believes that broad reforms are necessary to compensate injured patients promptly and equitably, enhance patient-physician communication, facilitate improvement in patient safety and quality of care, reduce defensive medicine and wasteful spending, decrease liability costs and improve access to care. The AAOS strongly believes that efforts for comprehensive medical liability reform should include the following core principles:

  • Compensation: Compensate patient for injury caused by negligent care promptly, fairly, equitably, and reliably.
  • Communication: Encourage early and free dialogue and advance the primacy of an empathetic patient-physician relationship.
  • Dispute resolution: Develop more equitable and less adversarial mechanism for dispute resolution while minimizing costs.
  • Encourage a culture of safety and quality by encouraging voluntary reporting of unanticipated occurrences and open dialogue through confidentiality laws, establishing firewalls between discipline and voluntary reporting systems, enhancing data collection and analysis efforts to enable effective system-wide and individual improvement, enhancing peer review to prevent abuse, ensure due process, and focus on learning in order to improve patient safety and quality of care, and encouraging system-wide responsibility for clinical safety and
  • improvement.
  • Reduce defensive medicine and excess healthcare costs by eliminating and/or minimizing factors that promote the practice of defensive medicine and by reducing assurance behavior to avoid the expense of unnecessary tests and treatment.
  • Increase patient access by eliminating and/or minimizing factors that promote the practice of defensive medicine (avoidance behavior) to increase availability of care.

Although it encourages federal medical liability reform, the statement reinforces the fact that “the AAOS believes that no federal legislation should include provisions that would undermine effective state reform provisions and the ability of states to enact tort reform tailored to local needs.”

The AAOS Medical Liability Committee, along with Doctors for Medical Liability Reform, will continue to monitor this important issue as the healthcare debate continues.

Additional Links:

Healthcare: What health executives are reading

The cost of defensive medicine

AAOS position statement on Medical Liability Reform

Stuart L. Weinstein, MD, is the chair of Doctors for Medical Liability Reform and a member of the AAOS Medical Liability Committee. He can be reached at stuart-weinstein@uiowa.edu

Editor’s Note: Articles labeled Orthopaedic Risk Manager are presented by the Medical Liability Committee under the direction of contributing editor S. Jay Jayasankar, 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.