Our existing medical liability system in Tennessee sorely needs effective reform. A "lawsuit-lottery" mentality is leading to problems in access to care, with some physicians considering dropping high-risk services. Effective reform would include a fixed cap on what are called non-economic damages and a graduated scale on payments to malpractice lawyers.
We have very good data on what liability insurance costs our doctors here, because more than 10,200 of our state's 13,400 active practicing physicians are insured through one company, called State Volunteer Mutual Insurance Company (SVMIC). Data shows the cost of liability insurance in Tennessee has gone up 87 percent between 1999 and 2005. This far outstrips the overall rate of inflation.
What is fueling this rise? By Tennessee law, up to one-third of the award goes to the plaintiff's attorney. Television in the Memphis area is rife with ads from various firms. One firm asks people to contact them for "any injury, major or minor." Another states "the sky's the limit." The result has been both a proliferation of lawsuits and a sharp rise in the money paid out by SVMIC through both settlements and jury awards.
In 1991, there were 877 new suits filed against policyholders of SVMIC, but in 2004 there were 1,534. That's a 75 percent increase in claims filed.
Is it just the "bad doctors" who are being sued? Actually, 70 percent of all Tennessee physicians insured by SVMIC in practice over 10 years have been sued, including 92 percent of practitioners of obstetrics/gynecologists and orthopedists and 100 percent of cardiac surgeons.
Who is paying for the defects in our liability system? Unfortunately, it's our citizens. Ten percent of our state's hospitals have dropped obstetrical services in the last five years. Older doctors contemplate early retirement, and our new graduates move to other states.
My colleague Jesse Woodall, a Bartlett-based obstetrician/gynecologist, comments, "I gave up obstetrics because I was not making enough to pay my malpractice insurance. I had to quit. My partners and I are not seeing any high-risk obstetrics patients any more, people with any sort of complication, such as high blood pressure during their pregnancy, and these are all things that we're well trained to do. The suits that are filed and the jackpot juries are a factor. You can do everything perfectly right and still lose the lawsuit."
Now is the time for the Tennessee General Assembly to take up effective reform legislation in medical liability when it convenes in January. What provisions need to be in that legislation?
Awards in professional liability cases fall into economic damages and non-economic damages. Economic damages are those which can be measured -- such as lost wages, hospitalization, and custodial care costs, whereas non-economic damages include such categories as pain and suffering, loss of companionship, and diminishment or loss of the pleasure of life.
California took the lead in putting a "cap" on non-economic damages in the 1970s through legislation called MICRA (the Medical Injury Compensation Reform Act). MICRA allows patients to sue if they need to, and it allows unlimited economic damages, but it puts a firm fixed limit of $250,000 on non-economic damages.
Some 26 other states -- including Georgia and Colorado -- have also established caps, and these states are not seeing a steep rise in liability premiums.
Effective reform legislation for Tennessee's medical liability system has been introduced in both the state House and Senate. It would allow unlimited economic damages but would cap non-economic damages at $250,000 and set up a graduated scale of payments to a plaintiff's attorneys.
Now is the time for us to contact our state legislators to ensure that liability reform gets the proper attention in the upcoming session.