“BETWEEN THE ROCK AND HARD PLACE”
By Lewis Sharps, MD
STORM CLOUDS ON THE HORIZON
Is the next malpractice crisis just over the horizon? Independent data released by Diederich Healthcare compares Total National Payouts for Medical Malpractice Settlements year over year. From 2003 to 2012 payouts decreased each year. Since 2012 Total National Medical Malpractice Payouts have increased for 3 (three) consecutive years. Total increases have been > 10% over the last three years despite the fact that insurance premiums have remained flat or decreased.
Historically the insurance industry is the last to acknowledge a change in market direction. The reasoning is a fear that raising premiums will result in a loss of insureds. During the last crisis from 2001 until 2008, PPIX was a life raft for hundreds of physicians who could not get coverage despite excellent claim histories. Our company raised rates at a fraction of what other companies did.
Why is this Market Change happening?
- Amnesia on the part of the public and the physicians. During a crisis the loss of affordable access to Med Mal Coverage results in physicians (a) retiring, (b) moving to areas of lower premium and/or (c) acknowledging the fact that riskier cases result in higher complication rates. This is turn results in more referrals to tertiary care centers. In addition, the loss of access to OB/GYN and other high risk specialties generates public outrage which generates publicity which in turn makes juries aware that their awards have a direct impact on themselves and their family’s access to care.
- Assumption of Complexity – Between crises physicians become complacent about the ability to access affordable Medical Malpractice Insurance. This is in turn results in a false sense of security allowing many of us to accept higher risk patients and perform higher risk surgeries. In a crisis, doctors, in my opinion, are more willing to refer high risk complex cases to tertiary care facilities.
- Physician Extenders- are a vital part of providing cost effective healthcare. Since the last medical malpractice crisis, physician extender numbers have increased exponentially. Recent legislation in Pennsylvania mandates that physician assistants and nurse practitioners carry a full $1,000,000 in coverage which is excluded from MCARE. In addition, within a practice, extender’s names are all over multiple patient charts covering multiple practitioners thereby making physician extenders an easy target for multiple malpractice claims.
- The Search for Zero- we live in a world that assumes zero imperfection as the norm and any deviation or complication is someone else’s fault. In a world of enlightened perfection, imperfection is not tolerated. The missing component is that the Search for Zero requires an unlimited budget that either the government or the public must be willing to bear. As physicians we are “between the rock and the hard place”. Overutilization is considered a sin even though studies prove that doctors who order more tests get sued less often.
Our job as your insurer is to protect you and your patients. By not being aware of a changing environment you make yourself more vulnerable.
In the end – “Who are the victims?” Obviously the victims are the doctors and the patients.
What do we do about the potential for another Medical Malpractice Melt Down?
- First, be aware that the Medical Malpractice Environment may be changing.
- Second, be aware of the above issues.
- Third, read the next PPIX Newsletter where we discuss possible solutions.