The national headlines on malpractice insurance were staggering 10 years ago. Media reports catalogued obstetrician-gynecologists who proclaimed they had to shut down their private practices in the face of runaway premiums. General surgeons and proceduralists decried payments tied to lawsuits they argued were arbitrary and capricious. And the American Medical Association (AMA) made announcement after announcement about states being in a “malpractice crisis.”
In recent years, though, premiums have actually fallen and stabilized at levels that those who track the medical liability industry say are manageable for bottom lines. But, that doesn’t mean otolaryngology, where surgeons are in the top half for premiums paid, isn’t feeling the pressure. “I see no relief in sight in spite of all the changes that are taking place in medicine with the Affordable Care Act,” said Michael Setzen, MD, immediate past president of the American Rhinologic Society (ARS) and chief of the Rhinology Section at North Shore University Hospital in Manhasset, N.Y. “The issue of malpractice doesn’t seem to be a priority.”
Otolaryngologist Ryan Sewell, MD, JD, of the University of Nebraska Medical Center in Omaha, is working on it. He has begun a project with The Doctors Company, a large medical malpractice insurance company based in Napa, Calif., to track endoscopic sinus surgeries, which most otolaryngologists agree tend to be the most litigated surgery. “We’re trying to get to have a more complete data set to be able to provide better information, not only about what injuries occurred, which is typically what’s happened before, but to try to give people some idea of which patients are going to be higher risk for malpractice claims,” Dr. Sewell said. “The third revision sinus surgery claim that’s going to put you at four-fold risk of having a medical malpractice claim…. I think that’s the kind of data that’s lacking not just in our field but in all fields.”
Still, even in a landscape of limited information, there are a few rules of thumb otolaryngologists should live by when it comes to managing their exposure to malpractice cases, according to interviews with a half-dozen health care professionals interviewed by ENTtoday:
1) Focus on communication skills and a thorough use of the informed consent process. Think of the consent process less in terms of getting a patient to sign a form and more in the vein of bedside manner.
2) Be diligent in documentation in charts, consent forms and pre- or post-operative notes. That information can be invaluable in later legal proceedings.
3) Avoid the practice of “defensive medicine.” Ordering tests and procedures that aren’t clinically necessary may seem as if it can serve as a protection from later lawsuits, but can add significantly to health care costs.
4) Be aware of how your coverage works. Is there “tail coverage” that protects you from incidents that happened at an institution where you no longer practice?
To be sure, many of the same tenets of being a productive otolaryngologist with high patient satisfaction scores—maintaining manageable patient loads, focusing on patient centeredness and employing checklists, technology and regimented protocols to reduce adverse events—translate very well to being a lower-risk otolaryngologist in relation to malpractice cases.
“The two goals are often very much in tandem,” Dr. Sewell added. “You provide better patient care, you’re going to therefore lower your risk of being sued in a medical malpractice claim. And, as a specialty, I hope we continue to focus on these efforts and try to develop better data sets and better ways in which to prevent claims and, therefore, provide better patient care.”
And the timing to tie those threads together could not be better, said John Meara, MD, DMD, MBA, plastic surgeon-in-chief at Children’s Hospital Boston. He believes the process reforms of the past few years could serve as a springboard to national liability reform, including health courts and other initiatives that physicians think would help deal with frivolous lawsuits, especially because much of the subject matter has been discussed at American College of Surgeons meetings over the past few years.
“Now is an excellent time,” Dr. Meara added. “We’re in an era of health care reform in general, and the Obama administration has been willing to voice concerns about medical liability issues. They espoused some of the alternative type of approaches … now is the time to take a look at some of the alternatives discussed.”
Medical malpractice has been around for centuries and has two obvious goals: to provide monetary remuneration to patients who have been injured by substandard care and to deter poor treatment through fiscal punishment. Malpractice lawsuits were not prevalent enough to be a major medical concern until the early 1800s. Cycles ebbed and flowed from there, with malpractice premiums causing crises in the 1980s and again in the early 2000s.
Now, rates for medical professional liability insurance have been dropping for seven years, and an eighth straight annual decline is expected this year, according to Mike Matray, the editor of trade publication Medical Liability Monitor and the chief content officer of its associated website.
“We are in the longest, deepest soft market that the malpractice insurance industry has ever been in,” he said. “Right now, things are really good for the doctors as far as rates coming down, and the dollar amount of their premium has been going down for almost eight years.”
Matray said he understands that declining rates may seem immaterial to a physician who receives an insurance bill that eats into the bottom line. For some specialties, that premium can be as high as $200,000 or more. “I’m not saying it isn’t expensive,” he added. “It’s expensive to run a medical practice. At the same time, medical malpractice insurance is less expensive in today’s dollars than it was in 2005.”
The reduction in rates is multi-faceted. Prominently, state level tort reforms such as non-economic damage caps, health courts and arbitration hearings are making it harder to bring cases to trial, particularly for lawyers who take cases on contingency. Second, frivolous lawsuits “are making an impression on jury pools,” Matray said, which means fewer filed claims and fewer cases that make it to trial. Third, this soft cycle has outlasted the typical pattern of rates falling for three to four years before rebounding.
“A lot of smart actuaries keep saying this has to change soon, because in a soft market there is a lot of competition,” he said, noting that to compete for low rates, insurance companies are offering credits to clients and using their own reserve cash piles. “So, things are really going to change in the next couple of years,” he added.
Impact on Otolaryngology
So what does it all mean for otolaryngology leaders looking to be proactive about medical malpractice liability insurance?
For starters, know your costs. According to The Doctors Company, the average amount paid in claims in otolaryngology (without plastic surgery) from 2007 to 2012 was $318,856, roughly the same as the amount paid in settled claims involving emergency physicians and gastroenterologists. The average expense to fight those claims was just over $74,000. For otolaryngologists who perform plastic surgery (typically a much lower risk factor), the average indemnity was just $93,700, with an average expense of $20,600, according to The Doctors Company.
Otolaryngologists also need to know their risk factors. According to The Doctors Company, the top three allegations that led to claims from 2007 to 2011 were improper performance of surgery (53 percent), failure to diagnose or delay in diagnosis (19 percent) and improper management of a surgical patient (15 percent). Of the 8,500 specialty-coded medical professional liability claims over that period, 247, or 2.9 percent, were tied to otolaryngology.
More specifically, there have been a handful of studies looking at particular procedures that would be highest risk. Among the latest was a paper published in July 2013 in Otolaryngology-Head and Neck Surgery (published online ahead of print July 26, 2013; DOI: 10.1177/0194599813498696) that reviewed 47 claims using the Westlaw legal database. The researchers found hearing loss was the most common injury cited, while payments were highest in acoustic neuroma and stapedectomy cases.
Another paper, also published in 2013, concluded that rhinologic procedures, and endoscopic sinus surgery in particular, were involved in 17 of 44 cases studied (Am J Otolaryngol. Published online ahead of print Januray 15, 2013; DOI: 10.1016/j.amjoto.2012.12.005). Dr. Setzen and his colleagues on that paper, including senior author Jean Anderson Eloy, MD, have published multiple papers in recent years trying to identify risk factors.
While the data is important, Dr. Setzen said bedside manner and connecting with patients are just as integral to limiting risk. “What is bedside manner? It’s your professional relationship to your patient, with respect to taking a good history, listening to your patient, doing a good exam, doing appropriate workup of the problem,” he added. “And then discussing in great detail the risks, benefits and alternatives. We need to tell them that when we do this procedure, there are certain inherent risks … You need to spend a lot of time with your patients. The problem is that time is of the essence these days. Doctors have to see more and more patients, and have less and less time with their patients. I think that’s where we’re going to get into more trouble.”
Dr. Eloy, vice chair of otolaryngology-head and neck surgery and director of rhinology, sinus surgery and endoscopic skull base surgery at Rutgers New Jersey Medical School in Newark, added that standardized and clearly written informed consent forms help. He has forms that detail risks, benefits and alternatives for every surgical procedure he performs. He then holds a separate meeting with patients and their families to go through the forms before getting a copy signed for his records.
“I would advise physicians to have a standardized process in place to address these issues,” he said. “Physicians should go over every point of the informed consent with their patients, and should note that they have done so in the patients’ medical records.”
A Peek at the Future
Holistically, the best long-term risk mitigation strategy for health care appears to be tort reform and a new way of looking at the way health care liability issues are handled in the country, said Anupam Jena, MD, PhD, assistant professor of health care policy and medicine at Harvard Medical School and an internist at Massachusetts General Hospital, both in Boston.
Dr. Jena said that there is limited evidence that enacted malpractice reforms have produced more than a 2 to 5 percent reduction in health care spending when compared with results in states that have not enacted these reforms. Instead, health care leaders should push for the elimination of so-called defensive medicine, which he said contributes the lion’s share of the estimated $50 billion annual cost of malpractice liability across the country.
Dr. Eloy said he can imagine why physicians order tests that aren’t clinically necessary in an attempt to prevent lawsuits and protect themselves in cases of litigation. But he believes such practices unnecessarily increase health care costs.
Dr. Setzen also understands the phenomenon, but said that wasting billions in a system starved for dollars will lead to a crisis. “Patients with significant medical problems who may need very complex surgery are going to find it difficult to find doctors because of the fear of lawsuits,” he added. “We’re all concerned that if we don’t do every test that we need to, and we miss something and then it goes to court, the first thing the opposing lawyer is going to say, ‘You didn’t do an x-ray on this patient.’”
Dr. Jena says a mindset shift and an additional focus on defensive medicine are the needed sparks to persuade policy makers in Washington to address the scope of money being wasted on health care tests done for the sake of lawsuit fears. “Do I think the country is in a malpractice crisis? No,” he said. “Do I think that defensive medicine is larger than we think it is? Yes. If physicians practice, as they felt they should practice without ordering extra tests and procedures, my guess would be you could reduce health care spending by substantially more than $50 billion.”