May 9, 2011 by matray

Last month, the National Conference of State Legislators (NCSL) wrote a letter to both the chairman and ranking member of the House Subcommittee on Health expressing “strong, bipartisan opposition to the passage of the latest federal medical malpractice legislation, HR 5, the ‘Help Efficient Accessible, Low-Cost, Timely Healthcare (HEALTH) Act of 2011,’ pending before the U.S. House of Representatives.” Modeled after the successful reforms contained in California’s Medical Injury Compensation Reform Act of 1975 (MICRA), the HEALTH Act contains a number of reforms considered critical for improving the fairness and efficiency of the medical liability system. These reforms include a $250,000 cap on non-economic damages; collateral source rule reform allowing evidence of outside payments to be made in court; a ban on subrogation by collateral sources; a fee schedule for attorney contingency fees; and periodic payments of future damages. “Medical malpractice, product liability and other areas of tort reform are areas of law that have been traditionally and successfully regulated by the states,” wrote William Horne, NCSL chairman, in the letter to the House Subcommittee on Health. “Since the country’s inception, states have addressed the myriad of substantive and regulatory issues regarding licensure, insurance, court procedures, victim compensation, civil liability, medical records and related matters. In the past two decades, all states have explored various aspects of medical malpractice and products liability and chosen various means for remedying identified problems. Over the past several years, states have continued to revise and refine their medical malpractice laws and procedures.... “NCSL studied this issue in 2005 when the last iteration of HR 5 was being considered by the U.S. House of Representatives. Our review included assessing whether circumstances had developed, or were so unique, that only federal action could provide an adequate and workable remedy. We again examined recent state actions, policy options and experiences. We discussed at length how various proposed or anticipated pieces of federal legislation fared against NCSL’s core federalism goals. Those questions included: (1) whether preemption is needed to remediate serious conflicts imposing severe burdens on national economic activity; (2) whether preemption is needed to achieve a national objective; and (3) whether the states are unable to correct the problem. The resounding bipartisan conclusion was that federal medical malpractice legislation is unnecessary.” Federal reform of the country’s medical liability tort system has been a Republican agenda item for years. The HEALTH Act was first introduced in 2005 and passed by the House. It was sponsored in the Senate by Sen. John Ensign, and co-sponsored by five other Republican senators. The legislation ultimately stalled in committee and never became law. The HEALTH Act of 2011 has been endorsed by the American Medical Association as well as the Physician Insurers Association of America, which represents medical professional liability insurance companies owned and/or operated by healthcare providers.

May 5, 2011 by matray

side note: This is an interesting article on a new phenomena -- physicians and surgeons marketing their services online. How hard -- and in what manner -- should physicians market their services? Why are we moving away from the traditional model of medicine where physicians refer their patients to specialists? And how much should the marketing of healthcare services be regulated? By David Armstrong - May 4, 2011 Bonnie Balch searched online for a back surgeon and found a pitch she called irresistible: Laser Spine Institute LLC promised to ease her pain and have her out the door in a few hours. Instead, her October 2008 surgery at the Tampa, Florida- based center left Balch incontinent, with a dangerous spinal fluid leak, she said. Still in pain, she was off work for almost a year and needed a second surgery elsewhere to get relief. “They should have told me they couldn’t help me,” said Balch, 63, a Longmont, Colorado, flight attendant. “They are in it to make money.” Her insurer paid Laser Spine $90,176 for the operation, a follow-up procedure and some subsequent care. Balch sued Laser Spine, alleging malpractice, in December 2009, one of 15 cases filed against the company in the past 18 months. The lawsuits reflect growing complaints about a new area of medicine: high-volume, doctor-owned spinal surgery centers that market directly to patients on Google Inc.’s search site and others. For Laser Spine, the business model generated a 34.3 percent net profit margin from 2006 through 2009 -- eclipsing even the Internet giant’s 24.8 percent for that period. Laser Spine and its competitors, part of a boom in outpatient clinics operated by entrepreneurial physicians, sell a high-tech version of procedures that have been around for years -- despite a lack of independent research to show that their variations lead to better outcomes. The company commands higher prices than laser-less rivals, driving up the cost of health care. Its number of malpractice claims per 1,000 surgeries is several times the rate for all U.S. outpatient surgery centers, based on insurance industry data. ‘Already Available’ “It strikes me as somewhat of a scam,” says Jeffrey Arle, a neurosurgeon at the Lahey Clinic near Boston who has treated former Laser Spine patients. He’s one of nine surgeons from across the U.S. who told Bloomberg News that the company’s laser surgery was either unnecessary or inappropriate for many patients who get it. “My conclusion is they are offering patients a version of what is already available in the regular medical care system.” Laser Spine’s in-house surveys show positive outcomes for more than 87 percent of patients, though the institute has had trouble recruiting academics to examine those results, said Jimmy St. Louis, the company’s chief operations officer. Its staff screens those who respond to its ads rigorously, he said, and only 10 percent of them end up getting an operation. The company’s standards for safety and quality of care help determine its pricing, said Dotty Bollinger, its chief medical operations officer. Works Every Day “We know it works,” Bollinger said of the surgery. “We see it every day.” Laser Spine declined to discuss Balch’s claims, which it has denied in court filings. Laser Spine often charges $30,000 for each procedure, according to interviews with several patients and copies of billing records. That’s twice as much as Aetna Inc., the third- largest U.S. health insurer, will pay for laser-less surgery. It’s more than twice the average reimbursement for spine procedures at Regent Surgical Health, a Westchester, Illinois- based company that operates 15 outpatient centers, according to Matt Lau, Regent’s corporate controller. Laser Spine’s surgeons, some of whom are investors in the 6-year-old company, perform as many as 5,000 operations a year, using small tubes called endoscopes that are equipped with video cameras. They insert the lasers separately, through catheters. Out of Bankruptcy Founder James St. Louis, 56, was just a year out of personal bankruptcy when he began seeking investors for the company in 2003, court records show. Now he owns multimillion- dollar homes in Pinellas County, Florida and Aspen, Colorado. He declined an interview request. The institute, which rewards employees with trips to the Bahamas when they hit sales and customer-satisfaction targets, has established surgical centers in Scottsdale, Arizona; Philadelphia; and Oklahoma City as well as Tampa. It now bills itself on the web as “the largest spine center in the world” and it had sales last year of $109 million, says Jimmy St. Louis, the COO and the founder’s son. From 2006 through 2009, Laser Spine earned net income of $98.9 million on revenue of $288 million, a 34.3 percent profit margin, according to testimony that chief executive officer Bill Horne provided last year in a lawsuit. In that case, Joe Samuel Bailey, an Arkansas businessman and the chairman of a rival spine center, alleges that St. Louis stole his business plan. St. Louis and Laser Spine have denied that allegation in court. Distributions to Investors The company has distributed at least $77 million to a small group of shareholders, according to an opening statement made by Bailey’s lawyer in the same court case. Another document in the case indicates that James St. Louis was slated to receive a 25 percent interest. That would entitle him to $19.25 million from the distributions. Bollinger said the 25 percent figure is not accurate. She would not disclose individual stakes. Other investors include the private equity unit of Dallas investment firm EFO Holdings LP, managed by William Esping, and two founders of OSI Restaurant Partners LLC, whose properties include Outback Steakhouse. In 2009, Goldman Sachs Group Inc. valued Laser Spine at as much as $428 million, as part of the company’s consideration of an initial public offering, Horne testified in Bailey’s lawsuit. Bollinger said in an e-mail that this estimate and others provided by bankers were “rough guesses” and not reliable. Aetna won’t cover operations at Laser Spine and some of its competitors, citing a lack of research to confirm their safety and effectiveness. Cigna Corp., the seventh largest U.S. insurer, won’t pay for the laser portion of the surgery. Other insurers provide less than full coverage. Second Mortgages Some patients, desperate for pain relief and a short recovery period, say they’ve tapped retirement accounts or taken out second mortgages to pay Laser Spine. They’re not always satisfied with the results. Fifteen former Laser Spine patients -- whose cases came up in court records, in the institute’s materials and in online back-pain forums -- said in interviews that their operations provided only fleeting relief, or no relief at all, from their back pain. The 15 malpractice claims since October 2009 came during a period in which the company performed about 7,500 procedures, based on its 2010 estimates. Nationally, outpatient surgery centers received about six malpractice claims for every 20,000 surgeries, according to data from Zurich North America, a commercial property and casualty insurer. Bleeding Internally Balch and others say that after their operations at Laser Spine they were told to get dressed and leave -- though Balch had suffered a spinal fluid leak and another patient was bleeding internally from two lacerated arteries, according to records in two malpractice suits. A third went to a hospital in need of emergency surgery just hours later, according to a state inspection report. Laser Spine executives say they meet state regulatory requirements. The company is a target for malpractice suits because it’s fully insured, said Bollinger, the medical operations officer. With regard to the claims in those suits, the institute gave Bloomberg News a statement that said: “We do not believe it is appropriate to dispute the facts at issue with a patient in the public forum.” Since July 2009, the institute has paid at least $2.8 million to seven patients to settle cases, according to the Florida Office of Insurance Regulation. Some of the cases were settled at the behest of Laser Spine’s insurer, Lexington Insurance Co., even though institute officials believed the care they provided was appropriate, Bollinger said. continue reading

May 4, 2011 by matray

side note: Here's an interesting article that I almost missed. It's written by Joanne Doroshow of the Center for Justice & Democracy, and she uses Congressional Budget Office (CBO) numbers to argue that tort reform -- specifically the HEALTH Act being considered in Congress -- would actually increase the deficit as well as add new burdens to state government. When people talk about medical malpractice "reform," they are usually not talking about reducing the epidemic of medical errors in hospitals or instituting proven measures to actually reduce injuries, deaths, claims and lawsuits. No, they're usually talking about making it more difficult for patients injured by medical negligence, including catastrophically-injured children, to be compensated. Despite the enormous hardships on innocent patients caused by these measures, or the fact that they shift compensation burdens onto others, there is an argument circulating that these measures are worth enacting because they will reduce the deficit. Well, no they won't. In fact, they will likely increase it. In October 2009, the Congressional Budget Office (CBO) presented an analysis (in the form of a 7-page letter to Senator Hatch) on "the effects of proposals to limit costs related to medical malpractice ('tort reform')," finding that "tort reform could affect costs for health care." CBO said that even if the country enacted the entire menu of extreme tort restrictions listed, including a Draconian $250,000 cap on non-economic damages, it could go no further than to find an extremely small percentage of health care savings, "about 0.5 percent or $11 billion a year at the current level -- far lower than advocates have estimated." On March 10, 2011, CBO provided a new analysis of H.R. 5, a bill before Congress that is considering these measures. CBO now says that enacting H.R. 5 would reduce total health care spending even less -- 0.4 percent. Yet to find even this small amount, CBO ignored factors that would not only lower this figure but also likely increase the deficit. For example, CBO acknowledges but does not consider in its cost calculations the fact that these kinds of extreme "tort reforms" would weaken the deterrent potential of the tort system, with accompanying increases in cost and physician utilization inherent in caring for newly maimed patients. CBO notes, "The system has twin objectives: deterring negligent behavior on the part of providers and compensating claimants for their losses ..." In fact, CBO wrote, "imposing limits on [the right to sue for damages] might be expected to have a negative impact on health outcomes." Yet it brushed aside the fiscal impact of this not because it is untrue, but because there are too few studies on the topic. However, of the three studies that address the issue of mortality, CBO notes that one study finds such tort restrictions would lead to a .2 percent increase in the nation's overall death rate. If true, that would be more than 4,000 additional Americans killed every year by medical malpractice, let alone the hundreds of thousands of additional patients injured. How could this possibly be an acceptable trade-off? Ten years ago, the Institute of Medicine put the costs of medical errors at between "$17 billion and $29 billion." Nowhere does CBO consider those costs, let alone the additional costs of caring for these newly-maimed patients as a result of new liability limits There will be new burdens on Medicaid and Medicare, as well, none of which were considered by CBO. If someone is brain damaged, mutilated or rendered paraplegic as a result of the medical negligence but cannot obtain compensation from the culpable party through the tort system, he or she may be forced to turn elsewhere for compensation, like Medicaid and Medicare. None of these increased costs are considered. What's more, whenever there is a successful medical malpractice lawsuit, Medicare and Medicaid can both claim either liens or subrogation interests in whatever the patient recovers, reimbursing the government for some of the patients' health care expenditures. Without the lawsuit, Medicare and Medicaid will lose funds that the government would otherwise be able to recoup. Again, none of these lost funds are factored in by the CBO. After CBO issued its original October 9, 2009 letter, members of the CBO staff agreed to meet with me and a panel of experts to discuss these issues. Among the things I learned at this meeting were: * It may be true that liability restrictions will create new burdens on state and federal deficits since the costs of injuries are not eliminated by enacting "tort reform," but merely shifted onto someone else -- including the government. However, no good study had yet been done on this phenomenon and according to CBO, if a study doesn't exist about a problem, it need not consider it even though savings could be significantly less than what they say. * Also, CBO arrived at these numbers by plugging selective studies into CBO's internal econometric models that no one ever sees. For example, I specifically asked how CBO could find a 0.2 percent savings due to lower medical malpractice insurance rates for doctors, when years of historical experience show this to be untrue. When Senator Jay Rockefeller (D-WV) asked CBO for a "complete empirical analysis of the cost savings associated with medical malpractice reforms," CBO's response was another seven-page letter. No empirical analysis, no econometric models, no data. continue reading

April 20, 2011 by matray

side note: Is a hospital-focused healthcare system the future of American Medicine? And if so, what are the liability implications? This is a great look at what looks to be the future of healthcare delivery in the United States. Physician-owned and operated medical practices appear to be going the way of the dodo. Across the U.S., hospital systems are buying out private medical practices at a rapid pace. Between 2005 and 2008, the percentage of medical practices owned by hospitals soared from 25.6% to 49.5% according to the Medical Group Management Association’s 2008 Physician Compensation and Production Survey (http://www.mgma.com). In 2010, for the first time, the number of new physicians who joined hospital-owned practices exceeded the number of first-year practitioners who became employees of medical groups owned and operated by physicians. Smaller physician practices are struggling under the strains of the recession and a rapidly evolving regulatory climate. Facing reductions in government reimbursements, an increase in the number of patients who are unable to afford their medical bills, uncertainty over the health care reform law, and the impending expense of the federal government’s urging providers to purchase electronic health records systems, many physicians in private practice are succumbing to hospital systems’ offers of economic certainty, reduced hours and therefore better quality of life, more resources, and the ability to devote more of their time to patient care. Hospital systems are on a private practice buying binge in anticipation of health care reform and the resulting need for an increased supply of doctors as more people obtain health insurance and seek primary care. Financial incentives created in the reimbursement scheme also support an integration of primary care physicians and hospitals. For example, the payment system for hospitals incentivizes efficiency because payment amounts are based on diagnosis codes, not necessarily the duration and scope of a hospitalization; however, the fee-for-service payment system for physicians does not necessarily induce the same amount of prudence. Hospitals have an improved ability to eliminate duplicative tests and provide patients with faster care where they control the physicians managing that care. Saying Goodbye to Private Medical Practices: Pros and Cons from a Liability Perspective • Impact of Electronic Health Record Systems On the advent of electronic health records systems’ major role in healthcare management, physicians and hospital risk managers need to remain cognizant of the threat of lawsuits, the importance of documentation in medical claims, and practice thorough and defensive documentation. Plaintiffs’ lawyers are seizing the opportunity provided by the rapid adoption of electronic health records systems – along with the associated risks and challenges – to argue that doctors are letting these electronic systems perform the evaluating and thinking in lieu of the physician’s more thorough clinical analysis. (more…)

April 7, 2011 by matray

Declaring New York State “functionally bankrupt” in February, newly-elected Gov. Andrew Cuomo proposed a $132.9 billion budget that would reduce year-to-year spending for the first time in more than a decade. Key to his proposal was slashing the state’s projected healthcare spending, specifically cutting $2.85 billion in Medicaid funding for this fiscal year and $4.6 billion in the 2012-13 budget. New York has the most expensive Medicaid system in the nation, currently serving one in four New Yorkers and costing more than twice the national per capita average. In order to cleanse New York’s Medicaid program of inefficiencies and waste, Cuomo appointed a Medicaid Redesign Task Force in January of 2011, which consisted of lawmakers as well as representatives of labor and healthcare interests. The task force issued 79 recommendations for the approval of the Governor and Legislature. The recommendations included establishing a $250,000 cap on non-economic damages in cases of medical malpractice as well as creating a Neurologically Impaired Infant Medical Indemnity Fund to compensate brain-damaged infants. “This comprehensive and consensus proposal achieves the dramatic reform this state needs to reduce costs without jeopardizing patient care,” Cuomo said. “This approach was not about making cuts but redesigning a program whose costs are unsustainable.” The unexpected endorsement of a non-economic damage cap by a governor from the Democratic Party elicited immediate condemnation from patient-rights advocacy groups and the New York State Bar Association, which testified that capping damages would “unjustly discriminate against accident victims who suffer the most devastating physical and psychological losses.” The Cuomo Administration countered that the $250,000 cap on non-economic damages is necessary to improve the predictability of future awards and settlements, decreasing the cost of medical professional liability insurance for the state’s physicians and hospital system, which would help them better adjust to other cuts in the Medicaid system. “Gov. Cuomo’s proposal reflects the fact that preserving quality and access in medicine, while reducing cost, will require fairness in the civil justice system,” said Cecil Wilson, MD, president of the American Medical Association, in support of the governor’s push for tort reform. “Every dollar spent on the broken medical liability system is a dollar that cannot be used to improve patient care.” After a month-long, often-contentious debate that pitted Gov. Cuomo’s office and the Republican-controlled State Senate against the State Assembly’s Democratic-majority, the parties ultimately announced an agreement for the 2011-2012 budget that excluded any cap on non-economic damages. The plan to create an indemnity fund for neurologically injured infants, however, did remain in the budget.

March 29, 2011 by matray

side note: Here is an article that shows the conflict of interest that is inherent in our current system of medical liability, and outlines a reform idea worth closer inspection. While sovereign immunity is doubtful, it is an academic argument worth exploring. It's been a year since health care reform was signed into law, and since then both Republicans and Democrats have been trying to address one item it left out: medical malpractice reform. In last month’s budget proposal, the Obama administration offered a solution: a plan to encourage evidence-based medicine by limiting the malpractice liability of doctors who follow clinical practice guidelines — in effect, granting them immunity. Doctors love this proposal, and patients should too: When doctors follow good guidelines they are less likely to order too many or too few tests or to prescribe the wrong treatment. Unfortunately, the proposal will not achieve the noble goal of providing quality care at a reasonable cost because the current guidelines, written by nonprofit medical groups and for-profit insurance companies, are not good enough. First, they often conflict with one another. Recommendations for when and how frequently to give women mammograms, for instance, notoriously vary depending on which group is giving them. In addition, there are conflicts of interest. Guidelines produced by insurance companies sometimes put their interests first. Malpractice insurers, for example, may recommend yearly mammograms, even if they are not necessary, because they bear the costs of lawsuits for late diagnoses of breast cancer — and not the costs or health risks of the extra mammograms. Moreover, the nonprofit groups behind many other guidelines have traditionally depended on pharmaceutical and medical device companies to finance their work. Last year, the Council of Medical Specialty Societies issued a new code of conduct seeking to stop these industries from sponsoring the development of guidelines, but there are still too many loopholes, and thousands of guidelines produced before the reform are still in circulation. Most troubling of all is that the groups behind the guidelines bear no liability for producing bad ones. No matter how poor the care they prescribe, it is the doctors who depend on them who are punished. Mr. Obama’s proposal to limit the liability of doctors who follow these flawed guidelines (included in a $250-million plan for overhauling states’ malpractice systems) is clearly not the way to better care. Immunity is a good idea. It’s just that we need to create the incentives necessary for the production of optimal guidelines first. This is no secret — last week the Institute of Medicine put out a report listing new standards for promulgating guidelines. I was a consultant on the report, which goes a long way toward improving the system, but I worry about the extent to which these standards will be followed. I have a different proposal for improving the guidelines: Instead of nonprofit groups producing free guidelines, or insurance companies producing ones that serve their own interests, the government should require health care providers to buy or license guidelines from what I call private regulators, for-profit companies with expertise in evidence-based medicine. Doctors would have immunity from malpractice cases if they followed the guidelines. However, the private regulators themselves would be liable if their guidelines were found to deviate from optimal care. The profit-seeking forces of the market on the one hand and legal accountability on the other would help private regulators strike the right balance between patient safety and cost of care. Private regulators would discourage the overuse of expensive medical procedures because doctors, under pressure from insurance companies to keep costs low, would be unlikely to invest in guidelines recommending unnecessary procedures. But if the guideline-makers failed to recommend an appropriate procedure, they’d be held responsible for the patient’s health. Just as they can now, doctors could deviate from the guidelines when required. Their discretion and autonomy would be preserved. But in most cases, when guidelines apply, doctors could follow them without having to worry about being held liable, and more important, about getting bad advice. Such a system may not be too far off: medicine is already moving toward for-profit guidelines. UpToDate, First Consult and eMedicine are just a few new databases compiled by for-profit companies in the business of making technical, evidence-based medicine more accessible to doctors. This is certainly exciting, but to provide doctors with the peace of mind they deserve, these companies need to be held accountable for the advice they give. continue reading

March 16, 2011 by matray

side note: Right now, Wisconsin is ground zero in the labor rights fight, but the villain Gov. Scott Walker pushed through a tort reform measure during an emergency session he called during his first week in office. Below is a synopsis by the Wisconsin Trial Bar of the tort reform law and its implications. Amendments to Wis. Stat. section 802.05, which sets out the procedure for challenging pleadings as frivolous and for imposing sanctions, remove judges’ discretion to impose sanctions after the safe-harbor period expires. Attorney Timothy Edwards warns those facing such a challenge to cure the offending pleading within 21 days. If this deadline is missed, the judge must impose sanctions, consisting of all actual costs resulting from the conduct – including attorney fees. March 16, 2011 – Gov. Scott Walker signed into law his “tort reform” bill, 2011 Senate Bill 1, on Jan. 27, 2011. This bill made significant changes to Wisconsin law relevant to tort litigation. One of the laws the bill changed was Wis. Stat. section 802.05, which allows and requires a court to impose damages for frivolous claims and defenses. Designed as Wisconsin’s counterpart to Federal Rule of Civil Procedure 11, section 802.05 lays out the procedure for challenging pleadings as frivolous and allows for the imposition of sanctions against a party, and its lawyer, for filing a frivolous pleading. This article explores the changes to this statute made by recent legislation. Historical version Section 802.05 was initially adopted as a court rule regulating pleading, practice, and procedure. In 2005, the Wisconsin Supreme Court adopted the 1993 revisions to federal rule 11 and incorporated them into Wis. Stat. section 802.05(3).1 These revisions abrogated the old requirement that upon a finding of frivolousness, a judge “shall award” costs and reasonable attorney fees. “Shall award” became “may impose an appropriate sanction,” which must be “limited to what is sufficient to deter repetition of such conduct or comparable conduct by others similarly situated.”2 The court held open hearings on this move from mandatory to discretionary sanctions, including testimony from State Bar members expressing concerns about the chilling effect that mandatory sanctions would have on creative, zealous advocacy. The amendments to section 802.05 made another important change: they added a “safe-harbor” notice provision. When a party challenges an opposing party’s conduct, it must first serve its motion for sanctions on the party whose pleadings are being challenged, along with a safe-harbor letter that gives the opposing party 21 days in which to withdraw the challenged pleading. If the pleading is not withdrawn, then the party challenging the pleading can file the motion and ask the court to impose sanctions. So viewed, a safe-harbor letter and accompanying motion is a statutory prerequisite to the later filing of a motion for sanctions pursuant to section 802.05. 2011 amendment The newly amended version of section 802.05 retains the basic steps in the procedure for challenging frivolous pleadings. A party can bring a motion to request a determination on whether another party has initiated, maintained, or continued a frivolous action. The court also may enter an order on its own initiative based on conduct that appears to violate the rule against frivolousness. The safe-harbor period remains 21 days. The most significant change made by the 2011 legislation was to remove the discretion of judges to impose sanctions after the safe-harbor period expires. Now, if a judge finds by clear and convincing evidence that a party has filed or pursued a frivolous pleading, the judge must exercise his or her discretion to impose sanctions if a party cures the offending pleading within 21 days of receiving the safe-harbor letter. In addition, now the judge must award sanctions if the offending party does not cure the offending pleading within 21 days of receiving the safe-harbor letter. Such sanctions include all actual costs resulting from the conduct, including reasonable attorney fees. The new version of section 802.05 also applies to appeals. If an award of costs for violating these provisions is affirmed on appeal, the appellate court must send the action to the lower court to award actual attorney fees for defending the appeal to the successful party. An appeal is frivolous “in its entirety” if “any element necessary to succeed is supported solely by an argument that is [frivolous].” This new law applies to actions filed on or after the act’s effective date of Feb. 1, 2011. However, because the rule is procedural, it may be applied retroactively.3 Summary The new amendments to section 802.05 raise the stakes for potentially frivolous actions, and remove some of the discretion afforded to judges in applying the rule. The most significant change is the directive that circuit courts must impose sanctions following a finding of frivolousness if the 21-day safe-harbor period has expired. The added discretion to impose sanctions within the 21-day safe harbor period, and the mandatory imposition of fees and costs against a party who unsuccessfully appeals an adverse finding of frivolousness, provide additional strength to Wisconsin’s prohibition against frivolous pleadings. Time will only tell whether these new directives will deter the pursuit of frivolous claims and defenses, as intended, or chill the pursuit of legitimate, creative claims that would otherwise vindicate important client interests. see original

March 7, 2011 by matray

side note: With all the cost-cutting that is proposed at both federal and state levels, this is an especially prescient report. As the healthcare industry, employers and government officials seek to control the growth of health spending, new efforts are needed to develop and refine quality-of-care and other performance measures that can assure changes will improve medical care and do not harm patients, according to a new study by RAND Health, the nation's largest independent health policy research program. While some current quality measurement tools may be useful to new performance-based payment models, significant work is needed to design and test methods which can be applied to measuring the quality of care provided under innovative payment reforms, according to the report. “Insurers and purchasers of healthcare in the United States are on the verge of potentially revolutionary changes in the approaches used to pay for healthcare," said Eric Schneider, MD, the study’s lead author and a senior natural scientist at RAND. “A significant investment is needed to develop new performance measures that can assure high quality care as the United States experiments with these new payment models.” The RAND report studied 90 payment reform programs and identified 11 general payment reform models that reward providers for delivering better-quality, cost-conscious care or pay healthcare providers a fixed amount to coordinate treatment of an illness such as diabetes. Since at least the 1980s, the traditional fee-for-service model of healthcare payment has been challenged by reforms that alter payment methods in order to limit costs. Critics say that the persistent use of fee-for-service—where health providers are rewarded only when they provide more care—encourages unnecessary health care spending without enhancing quality or efficiency. The Patient Protection and Affordable Care Act of 2010 has given new impetus to payment reforms that can achieve both cost containment and improvements in healthcare quality. Most of the new approaches are expected to tame costs by reversing incentives to deliver more care. Instead they create incentives to providers and patients to weigh the costs of their medical choices. But some worry that if providers are at financial risk, these payment models may have mixed consequences for quality. Quality measurement should be used to assure that the financial incentives produce high quality cost-conscious care. The study, "Payment Reform: Analysis of Models & Performance Measurement Implications," is available at www.rand.org.

March 3, 2011 by matray

On Feb. 10, Representatives Bob Good-latte and Dan Boren announced the creation of a bipartisan legal reform caucus, the Congressional Civil Justice Caucus. Goodlatte and Boren will serve as co-chairs of the newly formed caucus. According to the congressmen, the Congressional Civil Justice Caucus will serve as a forum for discussing and debating the many legal reform issues affecting the civil justice system, including medical malpractice reform, venue reform, patent reform and federal pleading standards. “Our nation’s civil justice system has a direct impact on America’s competitiveness in the global marketplace,” said Goodlatte. “Excessive and frivolous litigation and inefficient rules and procedures drain U.S. companies of desperately needed resources and hinder job growth and innovation.” The congressmen claim that recent estimates indicate that the cost of the U.S. tort liability system, as a percentage of gross domestic product, is more than double the average cost of any other industrialized nation and that America’s businesses and citizens alike need a well-functioning civil justice system that provides for the efficient and timely redress of legitimate disputes without allowing opportunistic parties to game the system. The goals of the Congressional Civil Justice Caucus include strengthening our civil justice system and advancing the United States’ leadership in innovation, job creation and economic growth; advancing the public’s understanding of how civil justice issues affect the free enterprise system as well as America’s global competitiveness; and providing a bipartisan forum for discussion and debate of policy issues related to our nation’s civil justice system. “I look forward to working with my colleague, Congressman Goodlatte, to promote a civil justice system that respects the rule of law while allowing for the type of innovation, economic growth, and free enterprise that makes the United States a leader in global competitiveness,” said Boren. “By providing a bipartisan forum for the discussion, we hope to help educate Members of Congress, staff and the public on policy issues related to our nation’s civil justice system.” The U.S. Chamber of Commerce has wholeheartedly endorsed the caucus, offering its aid in making “our nation’s overall civil legal system simpler, fairer and faster for all participants.” “According to the respected actuarial firm of Towers Watson, the costs associated with our tort system alone were $248.1 billion in 2009, which translates into a cost of $808 per person,” said Lisa A. Rickard, president of the U.S. Chamber Institute for Legal Reform, an affiliate of the U.S. Chamber of Commerce. “The system encourages gamesmanship, is incredibly inefficient and often results in inadequate compensation to those truly injured due to the transaction costs associated with litigation.” The Civil Justice Caucus also received the endorsement of the Law & Economics Center at George Mason University School of Law, which formed the Congressional Civil Justice Caucus Academy to provide education programs on civil justice issues. Of course, less optimistic observers noted that reform would be a difficult political venture. “Anything Congress passes not only has to go through the gauntlet of Senate Majority Leader Harry Reid, but must be signed by President Obama, who has shown no stomach for meaningful liability reform, and whose administration has taken several anti-jobs positions to benefit trial lawyers," said Ted Frank, founder of the Center for Class Action Fairness as well as a writer at Overlawyered.com and the Manhattan Institute's PointofLaw.com. In addition to co-chairs Goodlatte and Boren, Representatives Lamar Smith, Trent Franks, Jim Matheson and Collin Peterson serve as founding members of the Congressional Civil Justice Caucus.

March 2, 2011 by matray

side note: If this isn't a strong argument that New York's medical liability climate threatens access to care, I do not know what would be. A malpractice insurance company has threatened not to renew coverage for eight Bronx obstetricians who treat poor, high-risk patients. The New York Times reports that Medical Liability Mutual Insurance Company issued the warning in a letter last month. It went out to eight of 13 obstetricians at Bronx-Lebanon Hospital Center. The hospital delivers about 2,700 babies a year. Many of the patients are teenagers or have diabetes, high blood pressure or other medical problems. The letter cited a “method of practice” among the doctors that made them “an unreasonable burden” to other policyholders. It did not specify how many times each doctor had been sued. The hospital said its services compare favorably with other hospitals. continue reading