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William B. Eadie
William B. Eadie
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Oklahoma Republicans Show True Colors: Anti-Justice Business Tools

3 comments

Malpractice Entitlements” are on their way to hitting Oklahomans soon, making doctors a “special class,” entitled to commit malpractice without paying for their mistakes. Malpractice Entitlements (misleadingly branded “Tort Reform” or “Lawsuit Reform”), seek to fix a problem that doesn’t exist—runaway jury verdicts and lawsuit-inspired insurance hikes. (We know neither exists, but they make good sound bites.) But Malpractice Entitlements are worse than an unneeded fix, because Malpractice Entitlements “fix” a different problem: individual citizens’ right to access the American justice system on equal footing with a doctor, a corporation, or an insurance company.

You may be wondering, “what’s the problem with equal access to the American justice system?” Good question. Ask Oklahoma State Senator Anthony Sykes, R-Moore, the Judiciary Committee Chairman, who regurgitated the same tired line, that this “helps” people by protecting businesses and doctors while supporting a law that does no such thing:

We have been working on lawsuit reform for years, taking mostly an incremental approach because we did not have the numbers or a Republican governor to support strong reforms. These bills protect Oklahomans, our doctors and our businesses from frivolous lawsuits.

But we know better. The best way to reduce the cost of malpractice is to reduce malpractice, which works. (Makes sense, doesn’t it?) It doesn’t make sense to put this on the backs of the most injured, like the Arizona cap that forced one woman to accept $250,000 for a doctor taking the wrong ovary. How much is your ovary worth? Your wife’s? Your mom’s, before you were born? In Arizona, it is worth just as much as any other part—because everyone is stuck with an artificial cap.

Nor do insurance costs increase with malpractice verdicts—it follows a business cycle (as the insurance industry has repeatedly admitted).

There’s no reason to pass off the costs of a careless doctor’s mistake onto the backs of everyone else—not just the injured person, but the tax dollars we need to spend when Medicare has to take over to pay for the care of the injured person. Why discriminate against injured individuals? Why treat them any differently than anyone else? Than a business? (OK, maybe treat them better than we treat businesses, but not worse!)

The fact is that the jury system works quite well, and to prove medical malpractice requires another doctor to weigh in and say that the defendant doctor violated the “standard of care”—that is, made a mistake a reasonable doctor in that position would not have made—and that this avoidable mistake caused the injury. The cases are expensive, and the injured plaintiff bears that expense. In the end, after paying for the lawsuit, and repaying her attorneys, most jury verdicts are already

Instead, Oklahomans will suffer under a system made to deny injured individuals equal justice, by “capping” awards for their injuries:

• SB 862 will eliminate joint and several liability, protecting defendants from judgments that exceed the degree to which they are at fault (for example: preventing a person or company from having to pay for 90% of damages when they have only 50% of fault)
• SB 863 will put a hard cap on non-economic damages at $250,000
• SB 864 will require that compensation from sources independent of a defendant shall be submitted as evidence to the jury and subtracted from the amount of damages recovered from the defendant
• SB 865 will require that juries receive accurate information regarding tax impact on awards
• SB 866 will allow for periodic payment of future damages rather than requiring that awards be paid in a lump sum

Take a moment to read through that list, and imagine that the laws applied to corporations suing each other for breach of contract. Did your supplier steal your intellectual property and start up a competing company? Tough luck, you only get $250,000.

It is equally galling as is: whether you suffer from a bad knee, or have lost both legs in an avoidable medical error. Tough luck: you only get $250,000 for your trouble. Maybe you lost use of all your extremities, rendered a quadriplegic because a careless doctor decided he could operate with a couple drinks and an hour’s sleep. Tough luck: you only get $250,000 for your trouble.

But Malpractice Entitlements will save us a lot of money, right? Even the advocates for tort reform can only promise the most modest of savings, again, after targeting all lawsuits, whether “frivolous” or not. Consider that the National Commission on Fiscal Responsibility and Reform proposal lists “tort reform” at the very bottom of the proposed savings (courtesy of Bending the Health Care Cost Curve: Focusing Only on Federal Budget Outlays Won’t Solve the Problem, on The Commonwealth Fund Blog):

    • Reforming Medicare cost-sharing rules, capping beneficiary out-of-pocket spending, and restricting first-dollar coverage in Medicare supplemental insurance (savings of $110 billion).

    • Reducing Medicare payments to hospitals for graduate medical education (savings of $60 billion).

    • Extending the Medicaid prescription drug rebates established in the health reform law to beneficiaries who are dually eligible for both Medicare and Medicaid and obtain their prescription drugs under Medicare Part D (savings of $49 billion).

    • Cutting Medicare payments to providers for bad debts (savings of $23 billion).

    • Eliminating the use of provider taxes to generate additional federal matching funds for state Medicaid programs (savings of $44 billion).

    • Implementing other Medicare and Medicaid changes (savings of $32 billion).

    • Restricting first-dollar coverage in TRICARE for Life, which provides health care coverage for military retirees and their families (savings of $38 billion).

    • Piloting premium support through the Federal Employees Health Benefits Program (savings of $18 billion).

    • Enacting malpractice reform, including a statute of limitations, the creation of health courts, and other tort law changes (savings of $17 billion).

If tort Reform simply helped reduce medical malpractice, or made lawsuit for legitimate malpractice easier than “frivolous” lawsuits, I (and every other lawyer I know) would be all for it. Medical malpractice attorneys know all too well that bad cases are bad ideas, because they pay for the lawsuit. Nobody has more incentive to avoid “frivolous” cases more than the very attorneys who pay for—and lose money on—cases that don’t win at trial. That’s why they reject so many cases.

I welcome your feedback, and courteous debate.

Prior posts: Malpractice Entitlements On the Way

Newer post: Real Medical Malpractice Reform in New York—It’s About Patient Safety, Stupid.

3 Comments

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  1. Larry says:
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    The crux of the cause of frivolous lawsuits is contained in the last few sentences of this post.

    A lawyer with an economic interest in the outcome of a case represents HIMSELF first, the plaintiff second. That is why in every civilized country on earth, except this one (where the trial attorney lobby bribes congressmen in every election), contingent-fee cases are unethical and illegal.

    It should be the case here, also.

    Further, it should be the case that if you sue, and lose, you (the plaintiff, and the lawyer if they have an economic interest in the outcome of the case) pay the costs of the defense. I suspect that would stop 85% of all cases filed in the US, put lots of lawyers out of business (and nobody would cry about that), and cut costs of doing business by 60%.

    In the meantime, clamping down on ambulance chasers is…. a good start.

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    Larry,

    Thanks for taking the time to comment.

    You mention that “in every civilized country on earth, except this one (where the trial attorney lobby bribes congressmen in every election), contingent-fee cases are unethical and illegal.” I don’t want to assume that you care about freedom to contract (which is inhibited by restrictions on the contingency-fee contract), or that you believe–like our founding lawyers–that access to justice for ALL people (regardless or economic station) is important. Or that you care about the Seventh amendment. Perhaps none of theses things matter, and perhaps you are not the type of conservative tort reformer who would usually rail against European leanings (to which our system is a contrast).

    But you should at least know that European systems have been allowing contingency-fee-like arrangements for some time. Spain’s court struck down prohibitions on contingency fees in 2008. http://www.globaltort.com/2009/10/contingency-fees-in-europe-spains-supreme-court-allows-contingency-fees-and-thus-increases-the-pressures-on-other-nations/. And the UK allows “no win no fee” contracts.

    Moreover, do you support this type of proposition in all the other areas where businesses, for example, use these types of fee systems? If not, why not?

    Also, your final paragraph most tellingly describes cutting “60% of lawsuits,” not 60% of FRIVOLOUS lawsuits. Why cut valid lawsuits?

    Finally, contingency fees are naturally frivolous lawsuit deterrents, precisely because the lawyer DOES pay for the lawsuit if they lose the lawsuit. What they don’t pay for is the opponent’s fees, which would be quite barbaric. Now, you may think, “how can it be barbaric if Europeans do it?” but then you should remember that you live in America, where equal access to justice is a right you gained from the constitution, and which you should not be so quick to walk away from. Whether you realize it or not, the insurance/medical-legal/chamber of commerce lobby using far, far greater amounts of money–shockingly so. The “cost of doing business” isn’t affected by lawsuits, the “cost of doing bad business,” though, is.

  3. Larry says:
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    The countries (Spain and the UK) which allow contingency fees, are unlike those in the US, William. And you know it. They contain, within the allowance, a REQUIREMENT that the loser pays if there is a contingent agreement. That does not exist in the US. And thus, there is absolutely no real risk in filing a frivolous (and yes, most medical malpractice cases are frivolous – see the win rates for physicians versus plaintiffs, even in front of an ignorant – an thus not peer of the defendant – jury) case in the US. A filing fee – maybe $250, and a little time. That is enough to file a case. Nothing, really, given the potential payout from a settlement designed to prevent the cost of a valid defense (>$50,000 or more).

    The practice of medicine has long barred fee-splitting arrangements (common for lawyers), self-referral (common for lawyers), and many other types of dubious business practices engaged in every day by attorneys. So do many other licensed businesses. Attorneys exempt themselves, continually, because they run most legislatures.

    Furthermore, the practice of medicine is policed by license review boards which have all kinds of citizens on them. You want to tell me which Bar Grievance Committee in the US has a NON-LAWYER on it?

    And contingent-fee arrangements do one thing, and one thing primarily. It puts the economic interest of the attorney FIRST. If he needs money, he will urge the plaintiff to settle early. If not, he won’t. And don’t tell me that doesn’t happen every single day, because I know that it does, as does anybody who has been involved in a contingency-fee case.

    Just adopt the loser-pays rule, where everybody with an economic interest pays if they lose (including the lawyer), and you can have all the contingent fee cases you want. The number of filings would drop like a stone.

    You and all the other ambulance chasers want it both ways. But you won’t have it that way for much longer.