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July 05, 2004

Medical Malpractice

It seems very obvious to me that "tort reform" as proposed by the insurance companies and the doctors they love to take advantage of is a terrible idea. Namely some sort of arbitrary cap on damages, say $250,000.

When surgery is screwed up the costs of merely living for the rest of your life often greatly exceed $250,000. You may be in a wheelchair, or worse, you may need to be hooked up to expensive machines just to breathe. In most instances, these costs are computed (and are in the million dollar range) and the "award" a court will grant to the plaintiff is usually these costs plus some pain and suffering, and my guess is that the pain and suffering part of the award usually gets soaked up by the trail lawyer's fee.

What really irks me though is an article like this where they interview some doctor or other and don't mention until the end that maybe his insurance rates have gone up because he's admitted guilt in the past few years in a medical malpractice suit.

Dr. Don Campbell entered into a settlement for $350,000. This was not some runaway jury's decision, he agreed to admit guilt and that whatever he did monetarily required a $350,000 settlement to compensate for damages. Now he's in favor of a cap @ $250,000. If I just got into a car accident that was my fault I'd probably think a $1,000 cap on damages to the other person's car was a great idea, too.

But, that's hardly fair and that is what this breaks down to. If I get into a car accident my insurance company will have to pay damages to the other person and then they will raise rates on me. If other drivers in my area get into a lot of accidents, then my rates will probably go up also because I'm in a dangerous situation.

Maybe Dr. Don Campbell's rates went up because his insurance company had to pay a settlement on his behalf and since it recognizes he is more of a risk than when he had paid no settlement it is raising his rates. And because lots of other doctors are getting sued (and found negligent) that may also raise his rates -- he's in a risky profession.

Insurance companies are parroting out doctors as the victims in their ploy to artificially limit their costs the same way they would if they had to insure police officers or firemen. Which makes you think -- if doctors are just as vital to society as police officers and fireman should profit driven insurance companies be this intertwined with their businesses as they are?

The problem seems to be that insurance companies have numerous other business, including investments, and to make up for a bad businesses in their other sectors they are using doctors to try to limit costs there. Maybe a better thing to do would be to regulate doctor's insurance so that separate carriers that dealt only in medical malpractice insurance would be able to write the insurance. Then we'd find out if the "lawsuit lottery" or the poor performance of the stock market were to blame.

One final thought: Because the anesthesia is basically the most dangerous part of any surgery, just about any surgery is just as dangerous as the next, assuming you have to go under to get it. Could the rise in elective surgery, which is just as dangerous as heart surgery, be partly to blame for the rise in insurance premiums? If that's possible, insurers either need to readjust their premiums so that doctors who perform more elective surgery pay more -- and then they can decide if the higher costs of insurance are worth the higher volume of business they receive. If not, only do necessary surgery. Just a thought though -- and one thing this debate lacks is any out of the box thinking on either side.

Posted by Chris at July 5, 2004 12:58 PM

Comments

Posted by: Mark at July 6, 2004 12:42 PM

Posted by: Mark at July 6, 2004 12:44 PM

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