I never would have believed it could happen. Jury awards in malpractice cases have topped $100 million in Philadelphia! Of all the states, Pennsylvania has the highest liability award payouts per physician and the second highest per capita.1 Consequently, good practitioners of OBG may be forced out of practice by the state’s runaway system of medical liability insurance.
In the past 2 years, premiums have increased anywhere from 20% to 300%. A number of insurance companies have gone bankrupt or stopped writing these policies altogether. Many surviving insurers refuse to take on new customers or to cover physicians outside of low-risk specialties or with anything less than impeccable records. The result: 23% of physicians surveyed in Philadelphia have stopped practicing obstetrics.2 And 8 of the 30 obstetricians in my department, who lost their coverage when their insurers withdrew from Pennsylvania, cannot find any company to write them a policy.
Numerous physicians are being forced to discontinue the practice of obstetrics, retire prematurely, or move to a different state.
Like many jurisdictions, the Commonwealth of Pennsylvania requires doctors to have liability insurance in order to practice. Physicians who had received too many complaints to be eligible for customary underwriting were able to turn to the Joint Underwriting Association (JUA) for coverage. Now, even the rare Ob/Gyn without any history of a lawsuit is finding it necessary to turn to the JUA. Unfortunately, JUA rates are decidedly unaffordable for most practitioners. A physician willing to practice only gynecology may be offered a policy that costs $185,000 a year. Ob/Gyns are finding it impossible to obtain affordable insurance, making it impossible for them to practice their profession.
Lest you feel relieved not to be practicing in Pennsylvania, take note: The situation here can serve as a warning of the likely effects of the crisis. In fact, doctors across the country already are being hit with skyrocketing premiums (see for a review of conditions elsewhere in the nation).
What is fueling this crisis? Awards that are increasingly irrelevant to comparable cases and societal economics. A growing number of actions triggered by poor outcome rather than poor practice. And the slumping stock market, in which many insurers invested heavily, using their gains to subsidize low premiums.
Unfortunately, many of us are too busy dealing with the immediate effects of the crisis to consider its long-term implications, which are potentially devastating: decreased interest in OBG as a specialty and the diminished attractiveness of the medical profession as a whole. Numerous physicians are being forced to discontinue the practice of obstetrics, retire prematurely, or move to a different state.
What is the answer? Thankfully, the state legislature has begun to address Pennsylvania’s problem. It recently passed a medical liability package requiring that:
- awards for future medical expenses beyond $100,000 be paid out over time, rather than shelled out up front;
- patients be barred from recovering damages for medical costs already covered by insurers;
- medical experts be required to undergo judicial qualification” prior to testifying in medical liability cases;
- mandatory liability coverage be reduced from $1.2 million to $1 million; and
- $40 million be set aside annually for 10 years to reduce physicians’ liability expenses.3
But further action is needed. And that action must be swift and decisive to decrease the cost of liability coverage to insurance companies and reduce premiums to physicians. Only actions guaranteed to have those results will preserve access to quality health care. If the practice of quality medicine is to survive in Pennsylvania, we need to:
- Halt “venue shopping.” Because verdicts in Philadelphia have been known to exceed $100 million, attorneys in other locales—where awards rarely exceed $1 million—often scramble to move cases to the city. In one patient-injury case, the justification for moving proceedings was the fact that one of the medical instruments had a distributor in Philadelphia, even though the patient, physician, and hospital were from another county.
- Curtail the amount juries can award for “pain and suffering.” Although it is impossible to put a price on these judgments, $100 million is absurd! The amount must be capped at a level such as $250,000 or a multiple, e.g., 200%, of the economic loss.
- Pay awards for nonmedical expenses over time. When verdicts cover expenses over a period of 30 or 40 years, payments should be disbursed over that interval as well.
- Abolish “joint and several” liability. Attorneys often attempt to sue anyone who encountered the injured patient, including the hospital. The practice of joining several liabilities means that even an entity found to be minimally involved will be required to contribute to the judgment. Today, joint and several liability typically is used to create “deep pockets.” It encourages attorneys to move forward even when their cases are questionable.