A Strategy for Medical Liability Reform by Arthur Gale, M.D.

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A Strategy for Medical Liability Reform by Arthur Gale, M.D.

Over the past thirty years there have been literally thousands of articles written about our broken medical liability system. Although some progress has been made, trial lawyers continue to oppose tort reform legislation and they continue to relentlessly file non-meritorious lawsuits against doctors. This paper briefly outlines a strategy for liability reform, which is necessary for the future survival of the medical profession.

A 2009 letter to the editor of the Wall Street Journal from the president of the Physicians Insurers Association of America (PIAA) underscores just how badly broken the liability system is. This report based on more than 235,000 medical liability claims since 1985 states:

• Less than 30% of all claims result in a payment to the plaintiff. In absolute numbers this means that over 165,000 of the 235,000 doctors had non-meritorious lawsuits filed against them.

• Of the minority of cases that actually go to a jury verdict only 20% result in favor of the plaintiff.

• Claims against each physician cost more than $100,000 to defend.

• It takes 4.5 years on average for a claim to resolve.

• Fully 50% of the premium and investment income collected by the insurer is consumed by the system mostly in legal fees for the plaintiff and defense. The author concludes: “This is not a system that works for anyone except the system itself.” 1

The Remedy Caps on Pain and Suffering

The president of PIAA stated in his report that the most effective tort reform is a reasonable cap on pain and suffering. Most experts including the American Medical Association agree. Unfortunately in some states judges have objected to caps and ruled them unconstitutional. Their reasoning is based on the separation of powers doctrine. They maintain that caps limit their judicial prerogatives. Judges have undone legislation setting caps on pain and suffering.

In those states where judges are elected, trial attorneys will attempt to elect judges who will declare caps unconstitutional. Or, they will challenge the constitutionality of caps in court as they did recently in Missouri where Supreme Court judges are appointed.2 The plaintiffs’ attorneys lost this challenge but they will never give up. Physicians can never assume that because a state Supreme Court has ruled that caps on pain and suffering are constitutional that that the battle is over. Trial attorneys will continue to file court challenges until they win. There is simply too much money at stake.

Loser Pays

Loser pays is sometimes referred to as the “English Rule.” But it is not restricted to England. Most civilized countries throughout the world have loser pays laws. These countries recognize that non-meritorious lawsuits harm defendants. Every single one of the 165,000 doctors cited above who were falsely accused of committing malpractice has been harmed both financially and emotionally. Loser pay laws require that the loser in a lawsuit must pay the winner’s legal expenses including legal fees. The purpose of loser pays laws is to discourage meritless lawsuits.

Loser pays has been tried in two states-Alaska and Florida. In Alaska it has been moderately successful. Tort suits constitute only 5% of all civil legal matters-half the national average. Between 1980 and 1985 Florida adopted a loser pays rule that applied only to medical malpractice cases. Florida ultimately abandoned loser pays because victorious defendants were unable to collect legal fees from insolvent plaintiffs while a victorious plaintiff collected multimillion-dollar legal fees from a doctor who lost a case against him.3

There is a simple solution to this problem-litigation insurance, which is used in England and other industrial democracies. Defendants are able to recover legal fees from plaintiffs with limited personal assets through the purchase of litigation insurance. States could require plaintiffs to purchase litigation insurance and allow their attorneys to advance the premium as they do other litigation costs.

Expert Witness Reform

Plaintiff attorneys can readily find expert witnesses in the medical profession who will testify for the right price. The most egregious example of fraudulent expert witness testimony comes from a Johns Hopkins study. In this study 95.9% of chest films read by plaintiffs’ radiologists were read as positive for asbestosis whereas independent radiologists read the same films as positive in only 4.5 % of cases.4 An editorial in the journal where these findings were published was titled “Is something rotten in the courtroom?”5 The answer is categorically yes. “Rotten” aptly describes much expert witness testimony in U. S. courtrooms.

The Johns Hopkins study highlights the main problem in medical malpractice suits- truthful testimony from expert witnesses. Trial attorneys will not go to trial without knowing beforehand that their expert witnesses will testify on behalf the plaintiff. Trial attorneys claim that they seek justice. They even changed the name of their trade association from the Association of Trial Lawyers of America to the American Association for Justice. But how can you obtain justice without truth? The lack of truthful testimony has caused the public to lose respect for the law. In my opinion it is the main reason why our medical liability system is corrupt.

When the need for tort reform is discussed in public forums, state legislatures, or in briefs filed in courts of law the focus is usually on access to care rather than on truthful testimony from expert witnesses. Tort reform advocates argue that unless something is done there will be shortages of doctors in certain specialties. This argument is valid. But, in my opinion, it misses the main point, which is reforming the rules that set standards for expert witness testimony.

A few years ago the Missouri State Medical Association introduced an expert witness reform bill in the state legislature based upon the recommendations of the American Medical Association.6 The recommendations rested on the principle that expert witnesses should be independent and give truthful testimony. It never got through the legislature because of trial lawyer opposition. The trial attorneys are not interested in obtaining independent truthful testimony

I thought that affidavit of merit statutes such as the one enacted in Missouri several years ago would limit nonmeritorious lawsuits.7 Initially they do. But never underestimate the resourcefulness of the trial attorneys. They just revert back to their old tactic of finding experts for hire by trolling the Internet. These so called expert witnesses will sign affidavits of merit and then act as expert witnesses. At the recent MSMA annual convention in November 2009 AMA president-elect Cecil Wilson pointed out that affidavits of merit haven’t worked in his home state of Florida.

Response of Doctors

One would like to think that most physicians are fighting to change the prevailing unjust tort liability system. But it appears that many if not most doctors are apathetic and passive. A defense attorney told me recently that that I would be surprised at the number of doctors who will testify for a price on behalf of plaintiffs. He attributed this willingness to testify to decreasing reimbursement from managed care. He also said that in the past older doctors would take a malpractice suit personally and would vigorously defend any suit that they thought had no merit. He said that today younger doctors don’t seem to care. They have to see so many patients per day that they don’t want to take the time off to defend a lawsuit and lose income. They look at malpractice lawsuits simply as part of the cost of doing business.

This apathy and passivity is also reflected in the small percentage of doctors who join organized medicine. Less than 20% of doctors are members of the A.M.A. and a minority of doctors belongs to state and local medical societies. Yet these are the very organizations that fight for the rights of physicians under our broken liability system. It is almost as if the medical profession is in the grip of a massive Stockholm syndrome where victims identify with their oppressors.

The present medical malpractice tort liability system is so unjust, corrupt, and outrageous in my opinion, that I personally would be reluctant to accept as a patient any trial attorney who supports it and opposes reform. I know that most physicians will disagree with this position. However, the Principles of Medical Ethics of the American Medical Association state: “A physician shall in the provision of appropriate patient care, except in emergencies, be free to choose whom to serve...”8

In the final analysis the battle over tort reform is not just a problem for doctors. The excesses of litigation afflict all of society. The profession of medicine is just one of many professions and businesses under siege by the trial attorneys. Polls have shown that the public supports tort reform.9 They also show that the public’s opinion of physicians is far higher than it is for trial attorneys.10 With the backing of the public and competent and dedicated leadership the battle for tort reform can be won.



1. Smarr, Lawrence E, Letter to the Editor, Wall Street Journal, July 7, 2009

2. .SC90107, James and Mary Klotz v St. Anthony’s Medical Center, Michael Shapiro M.D., and Metro Heart Group LLC, Opinion issued March 23, 2010.

3. Gryphon, Marie, Civil Justice Report, Manhattan Institute for Legal Policy, December 2008.

4. Gitlin, et.al., Academic Radiology, August 2004.

5. Janower, M. and Berlin, L., Academic Radiology, August 2004.

6. Missouri State Medical Association Expert Witness Reform Bill of 2006.

7. HB 393, Missouri Tort Reform Law of 2005.

8. American Medical Association, Council of Ethical and Judicial Affairs, Principle V1, Principles of Medical Ethics.

9. Sorrel, Amy Lynn, Medical Lawsuit Limits Favored by Public, American Medical News, December 8, 2009.

10. Gallup Polls annual Honesty and Ethics of Professions surveys, 2006,2007, and 2008,Gallup Poll.com.