The Truth On Tort Reform, the Health Care Industry, and Our Elected Officials

Follow the money.
In January 2011 a federal bill was proposed by Republican House Representative John Gingrey of the state of Georgia to cap all pain and suffering awards to $250,000. [known as H.R. 5 - Help Efficient, Accessible, Low-Cost, Timely Healthcare (HEALTH) Act of 2011].  This is surprising since Georgia’s highest court nine months earlier held that their own state law placing these caps was unconstitutional.  In fact, many states have already held that these capping laws are unconstitutional.  According to www.maplight.org, Representative John Gingrey has received $268,566 in campaign contributions so far to support this bill.  Even more revealing, over $32 million from special interest groups has been given to our elected lawmakers in contributions to get this bill passed. $32 million is not needed to pass a good law, only a bad one.

Lawsuits are the consequence, not the problem.
Lawsuits start because someone believes they were wrongfully injured due to a person or corporation’s negligence.  Insurance companies claim that physician malpractice and patient health care premiums increase because of lawsuits.  The insurance companies fail to mention that their companies even without the capping laws are earning billion dollar profits that have not been affected by the recession.  The insurance companies also do not mention that for years they have been paying doctors less and less for physician medical services provided to a patient.  This is causing doctors to schedule more patients per day, spending less time diagnosing problems, performing fewer tests, and as a result, making more mistakes.  The consequence is that patients are being harmed while the CEO’s of these health care companies are earning multi-million dollar salaries.

Lawsuits are decided by the people and overseen by lower court and appellate judges.
Verdicts are decided by ordinary members of the community who hear evidence from both sides and decide whether negligence, causation, and damages exist.  Defense verdicts and plaintiff’s verdicts equally occur depending upon the evidence.  A jury reviews medical records, hears testimony from doctors on both sides, and spends considerable time deliberating before reaching a verdict based upon the evidence and the law.

The courts  do not allow unreasonable verdicts to stand, but routinely lower them if excessive.  A defendant will ask the trial judge to reduce the verdict if unreasonably high.  If the verdict is not reduced by the trial judge, a defendant can have a panel of appellate judges review the entire case.  Even if a trial judge reduces the verdict, a defendant can still ask an appellate court to reduce the verdict even further.

Rather than hurt the Medicaid and Medicare system, litigation helps recover monies back to these state and federal agencies.
If a person is injured and has no private health insurance, the medical bills will likely be paid by Medicaid or Medicare.  However, if a lawsuit is successful, Medicaid and Medicare will be the first ones to get their money back from any personal injury award.  A person who receives a significant award will also no longer need state and federal assistance, further saving the taxpayers money.

Malpractice suits are too costly for an attorney to take unless it is meritorious.
The reason a lawsuit is commenced is because another qualified doctor, after careful review of the medical records, believed there was malpractice committed by one of his fellow doctors; not the opinion of the patient nor of the lawyer. In New York State, a doctor must first be consulted to review all the relevant medical records and only after he or she agrees that there is a case may an action be commenced.  Fines up to $10,000 can be brought against an attorney in New York for filing a frivolous lawsuit.  These measures are the first steps preventing frivolous lawsuits from occurring.

The most important reason frivolous malpractice actions do not occur is because malpractice lawsuits are extremely expensive to litigate.  Many cases require having doctors in different specialties review the medical records. These doctors are generally paid for their hours of time to review a case at a significant cost.  Additionally, in New York and most states, attorneys get paid only if there is a recovery, so there is no incentive to take a frivolous case that will take years of time and expense to litigate.  Lastly, because of another tort reform law passed to try and discourage lawyers from taking malpractice cases, New York lawyers get paid even less for their time litigating a malpractice action compared to a simple car accident.

A cap on damages can mean ending medical malpractice lawsuits altogether in New York State and further lowering the standards of medical care.
Most injured patients cannot afford paying a $50,000 retainer to pay an hourly rate which is why lawyers agree to work on a contingency basis.  When there is no recovery, there is no fee.  If the damage awards are capped, the majority of lawyers will not be able to afford to take medical malpractice cases, even if they are meritorious.  The insurance companies and hospitals know this and are doing everything they can to place the caps. There is nothing showing that caps on damage awards will stop malpractice from occurring, stop insurance hikes, or cause doctors to get paid more by insurance companies.

Lawsuits are a deterrent to unsafe practices and promote behavioral changes quicker than the legislature could perform.  Without such lawsuits, there would be no remedy for a patient wrongfully injured other than filing a complaint with the Medical Grievance Committee, which is comprised of mostly doctors who rarely discipline even the worst offendors.

For example, a Rhode Island patient in 2007 had the wrong part of his brain operated on by a surgeon and died three weeks later.  A nurse practitioner did not record which side of the man\'s brain required surgery. When another nurse pointed out the missing information, the surgeon allegedly relied on his memory without consulting a CAT scan chart and began operating on the wrong side.  Upon realizing the error during the surgery, the surgeon operated on the correct side.   After reviewing that incident, the state Board of Medical Licensure and Discipline decided there were mitigating circumstances and opted to create a remediation plan rather than sanction him.  Similar incidents involving surgeons operating on the wrong side of the brain due to carelessness have occurred nationwide.  The injuries have ranged from severe brain damage to death.  Lawsuits are responsible for pushing hospitals to promulgate new rules to prevent such terrible mishaps.

The proposed bill by four N.Y.S. legislators is meant to cap all personal injury actions and wrongful death cases.
This past January, four New York State Assemblypersons, Nancy Calhoun, Jane L. Corwin, Stephen Hawley, and Clifford Crouch put forth a bill to cap non-economic damages to $250,000 not just for medical malpractice actions, but for every single personal injury action including wrongful death actions.  At the same time, Governor Andrew Cuomo in New York employed a task force mostly comprised of healthcare individuals who want a cap of $250,000 on medical malpractice pain and suffering awards.

The legislative bill, identified as A3444 Calhoun, offers the following justification for its enactment:
“The awards granted for non-economic damages for personal injuries are often arbitrary and difficult to calculate with any specificity. Frequently, the award bears little relationship to the injury.  This leads to potentially unlimited liability and at times unnecessary litigation and as a result, increased insurance costs. This act would institute a ceiling on awards to limit liability and curtail the number of frivolous claims.  However, this act recognizes that occasionally a defendant acts in a grossly negligent manner by removing the ceiling on non-economic damages, in such cases.”

The questions you should ask these legislators and the Governor are as follows:

1. Who says awards for non-economic damages are often arbitrary and difficult to calculate with any specificity?  We know these determinations occur every day by New York residents sitting on juries from housewives to businessmen.  Are there any studies, statistics, or research by scholars or jurists to support these assumptions?
2. Who says that there is unlimited liability?  Are you aware that judges have never allowed “unlimited liability?”  How does the right to non-economic damages “result [in] increased insurance costs?” If the insurance and health companies are making billion dollar profits and CEO’s are taking multi-million dollar bonuses, why is this law necessary?
3. This act would curtail the number of frivolous claims?  Doesn’t it actually curtail the meritorious claims?  If frivolous cases by definition have no monetary value, don’t the caps just affect the meritorious cases that are valued by a jury at more than $250,000?
4. The bill states “occasionally a defendant acts in a grossly negligent manner” so only then should the victim get full justice.  So under this proposed law, if a person goes speeding through a red light and crushes a 5 year old girl’s leg resulting in multiple surgeries, lifelong pain, deformity and disability, the maximum she can receive for her pain is $250,000.  But if you could prove the driver first had 5 beers, then her damages are not capped?  How would you justify the difference to this 5 year old girl?

The truth about why your insurance rates continue rising.

• December, 2007 - beginning of the recession due to corporate greed and dismal oversight by lawmakers.
• American International Group (AIG)
  2008 AIG receives 173 billion dollar government bailout.
  2009 AIG takes 165 million of bailout money to pay top executives bonuses.
  2009 AIG, Executive VP, Rodney O. Martin, Jr. earns $10,193,191.
  2010 AIG bonuses expected to total $100 Million.
• Aetna Health Insurance
  2007 Chairman and CEO, Ronald A. Williams earns $19 million dollars.
  2008 Williams earns $18 million.
  2009 Williams earns $18 million.
  2010 Aetna operating earnings at $1.6 billion.
  2011 February report shows projected operating earnings of $1.4-1.5 billion.
• United Healthcare, Inc.
  2009 CEO Stephen Hemsley earns $102 million.
  2010 first quarter profits show a rise of 21 percent to $1.2 billion.
• Wellpoint, Inc. (largest health care provider in U.S.)
  2009 Angela F. Braly, Chair, Pres., and CEO earns $13 million.
• Average American salary, $46,000.

Laws that should be proposed to address our healthcare problems.
Rather than removing a civil right for something that has never been shown to affect health care costs, insurance premiums, or quality of healthcare, these are some suggestions for our legislators to help deal directly with the problems at hand.

1. Place caps on all insurance rates.   Have a 10 panel commission each year decide whether an increase in premiums is warranted for each of 5 classifications of risk addressing every type of insurance, ranging from highest to lowest risk. We do it for rental properties, we do it for utility companies, it can be done for insurance companies.
2. The above panel should be composed of people who cannot accept campaign contributions and have no financial interest in these companies. All hearings should be made open to the public.
3. Place a cap on campaign contributions. Legislators should decide bills based on what is good for the public, not good for their pocket.
4. Place stringent caps on CEO salaries and bonuses of insurance and health care executives.
5. Pass laws allowing federal prosecutors to have quick access to insurance company records to avoid further acts that can destroy the entire global economy, with harsh criminal laws to deter future reckless actions.

In conclusion.
This has nothing to do with whether you are a Republican or Democrat. These proposed laws will affect everyone’s children.  Lawsuits bring accountability to people, businesses, and governments for their reckless actions.  Despite the propaganda, there is simply no demonstrated relationship between lawsuits and the healthcare problems of today.

What can the average person do to be heard?
The best way to express an opinion and ask questions are by calling your local, state, and federal lawmakers at their offices or writing on their websites to say how you feel. No one should be told that they are too busy to accept a call or opinion by a constituent.  Below are websites to find your local legislators.

http://www.usa.gov/Contact/Elected.shtml (US President)
http://www.senate.gov/general/contact_information/senators_cfm.cfm (U.S. Senators)
https://writerep.house.gov/writerep/welcome.shtml (U.S. House of Representatives)
http://assembly.state.ny.us/mem (NYS Assemblypersons)
http://www.nysenate.gov (NYS Senators)
http://www.governor.ny.gov/contact/GovernorContactForm.php  (Governor Andrew Cuomo)

Brett J. Nomberg / Steven E. Rosenbaum
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Brand Brand Nomberg & Rosenbaum
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