Editor’s note: Judy Cates, a trial attorney at Cates, Kurowski, Bailey & Shultz, LLC in Swansea, is the president-elect of the Illinois Trial Lawyers Association. In response to commentary provided by Memorial Hospital president Harry Maier in last week’s edition of the Record, Cates weighs in on medical malpractice reform passed by the state legislature.
Q: Are caps a bad idea? If so, why?
A: Caps on compensation are a bad idea.
First, they have never lowered premiums for doctors. Ed Murnane, is the president of the Illinois Civil Justice League, of which ISMIE and ISMS are members. Mr. Murnane recently said: “We never made a claim that a cap is going to lower insurance rates.”
Second, in essence, a cap on compensation is a second injustice. The patient is first maimed (or killed) by the negligence of a physician or other health care provider. Then, the patient receives arbitrarily limited compensation for less than their injuries are determined to be worth in a trial by jury, solely because they were injured as a result of medical negligence.
Caps on compensation to those injured by medical malpractice unfairly discriminate against those most severely injured, and hits minorities, women, children, the poor, and the elderly even harder. They are more likely to have no loss of income. Remember that compensation for medical bills is not really the patient’s money- it goes directly back into the healthcare system to reimburse insurance companies. Therefore the patient’s only damages (for pain and suffering, disability, disfigurement or loss of society for the death of a family member) are arbitrarily and severely limited.
Finally, caps on compensation have been found unconstitutional twice before by our Supreme Court under the same Constitution we have today.
Q: Why are doctors leaving Illinois?
A: Doctors are leaving Illinois for many reasons. One is the hostile climate created by a completely unregulated insurance industry, dominated by ISMIE, which cynically manipulates what doctors are charged for their malpractice premiums. ISMIE raised its rates 50 percent in two years, during a period when filings and payouts were stable or even declining. And ISMIE collected $300 million more in premiums over the last three years than it paid out in claims and defense costs.
ISMIE's average claim payment in 2004 was 20 percent less than the year before. This is an insurance problem, not a lawsuit problem. As for the other reasons why doctors are leaving, look to California which has had a cap on “non-economic” damages since 1975. In 2001, the California Medical Association found that over 40 percent of its surveyed doctors planned to leave the state within three years.
Despite their cap on damages, they, too, were experiencing widespread complaints of shortages of specialists, including neurosurgeons and Ob/Gyns.
Why? Physicians in California and throughout this country are experiencing reimbursement problems, HMO hassles and government regulation. Even a recent study in the Journal of the American Medical Association questioned the notion that caps improve access to healthcare.
So much for caps on compensation solving access to healthcare problems.
Q. How do you respond to the remarks made by Memorial Hospital president Harry Maier in last week’s Record. He asserts that a $500,000 cap on damages for physicians and $1 million for hospitals is too high.
A: Harry Maier’s comments are surprising because I am unaware of any facts to support them. For example, Mr. Maier states that caps provide insurance companies with “predictability” for lowering insurance premiums. But most studies conclude that caps on compensation do nothing to lower insurance premiums.
Moreover, at legislative hearings, the ISMIE/ISMS representatives refused to promise the Illinois legislature that caps would lower premiums in Illinois. And the experience in our sister state of Missouri is conclusive proof that caps do not lower premiums, even when lawsuits and claims are at an all-time low. Remember, Missouri did not just pass a cap in 2005. It has had one since the mid 1980s.
Mr. Maier also claims that “no major medical malpractice insurer has announced a willingness to consider re-entry into Illinois.”
I understand that there is a new company which started its application process early this year, that will be in the market very soon, pending final regulatory approval. And at hearings in the legislature, it was disclosed that insurers who write a small percentage of the malpractice market in Illinois, such as PIC-Wisconsin and GE Medical Protective, who want to increase their market share, are requesting full disclosure of information from ISMIE.
ISMIE, of course, has refused to provide the information required to make Illinois a competitive market, even though disclosure is standard practice throughout the country, like Wisconsin.
Mr. Maier also claims that the Chicago politicians don’t seem to care about the crisis in southern Illinois. I don’t know what he is talking about. The “Chicago politicians” were in full support of stronger doctor discipline to weed out bad doctors. They also advocated significant insurance regulation and the patients’ right to know. They were justifiably opposed to caps on compensation, for the obvious reasons I gave previously.
In fact, each and every member of the Black caucus in both the House and Senate of the Illinois legislature, including the downstate members, (except Senator James Clayborne), voted against this cap legislation. Senator Clayborne was obligated to vote for this legislation as he is a partner in the law firm of Hinshaw Culbertson. His law firm represents ISMIE throughout the state of Illinois. Hinshaw Culbertson makes a lot of money defending doctors on behalf of ISMIE. Mr. Clayborne was lining his own pockets and ignoring his constituents, particularly minorities, when he voted in favor of this legislation.
The reality is that Memorial Hospital is a well-funded entity that, because there is no government regulation, will never have to disclose the amount of money which it maintains in its retention pool.
According to Mr. Maier, the defense costs for defending malpractice claims has been constant over the last several years. Despite this fact, Mr. Maier continues to claim that St. Clair County is a “hot-bed” of litigation. Again, reality does not reflect there is any truth to his hysteria. The statistics in St. Clair County and Madison County reveal that there have not been an increasing number of lawsuits. The physicians cannot point to one “run-a-way” jury. In fact, very few lawsuits have proceeded to trial in the past several years.
Ask a doctor to which excess verdicts he/she refers. There are none. And I have not heard one doctor yet discuss a local case which was tried to verdict where the jury’s award was excessive.
If you believe Mr. Maier, then there is no circumstance where malpractice ever occurs. A physician could operate on and remove the wrong leg of a child and that disability should, in Mr. Maier’s opinion, be worth less than the cap presently offered by the legislature.
Q: As President-Elect of the Illinois Trial Lawyers, tell us where ITLA stands on reform?
A: The Illinois Trial Lawyers Association supports the constitutional right to trial by jury. It is one of the fundamental rights granted by the founding fathers. Caps on compensation infringe on that constitutional right, as determined by our Illinois Supreme Court twice in the last 30 years.
I suspect that if the legislature passed a bill capping the number of guns your readers could own, we would be having the same discussion about the Second Amendment. ITLA opposes any legislation, such as SB 475, which would allow special interest groups to interfere with our fundamental rights. By the way, if the cap is found unconstitutional, the way the legislation is written, it appears as if the insurance reforms get thrown out, too.
Q: What can be done to attract physicians to the Metro-East?
A: If you watch the newspaper advertising, you will see that the Metro-East is already attracting new physicians.
More can be done. First, and foremost, Illinois needs strong insurance reform. ISMIE must be forced to reveal information critical to increasing competition from other carriers. No rates should be allowed to “sky-rocket” without a showing by the carrier of an objective need to raise the rates. ISMIE has earned hundreds of millions of dollars in excessive premiums through the use of unchecked rate increases.
This money should be returned to its doctors. Although this fact is not discussed often, the hospital systems in the Metro-East have the ability to attract young physicians by offering loans, employment and financial incentives. Memorial Hospital is a wealthy institution - yet it stifles competition from doctors through the use of exclusive contracts. These types of arrangements prevent doctors from locating in our area.
Q: What are your predictions if the bill is signed into law?
A: The one conclusion that Mr. Maier and I can agree upon is that this bill will not work. We cannot expect that physicians will have any relief from rising insurance rates in the near future. I am surprised that our health care providers who are so well-educated do not investigate the reality of “caps.”
Our physicians should look in the mirror and ask whether they really think they have been adequately represented by the special interest groups.
Having represented many physicians on issues related to reimbursement, I can tell you that once the doctors decide to undertake a realistic approach to the ills of their profession, the diagnosis will reveal that the real cancer is the insurance company or health care institution feeding upon the physicians in order to gain a profit.