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High-stakes medicine


Dr. Jose Angel used to perform routine screenings for colon cancer for his patients. Last year, the internal medicine specialist at Mercy Medical Center chose to discontinue the screenings in the face of high malpractice insurance rates and the threat that he might be sued for a missed diagnosis.

“It’s one less thing to worry about,” said Angel, who knows 22 other doctors across the state who have made the same decision. “I don’t have to worry that I’m going to hear from a patient five or 10 years from now who says, ‘You didn’t catch my cancer.'”

Increasingly, the high cost of medical malpractice insurance is forcing physicians to stop performing procedures that subject them to greater risk of being sued. According to the Iowa Medical Society, the fallout from that includes surgeons who will no longer conduct certain high-risk surgeries, family physicians who will no longer deliver babies and older physicians who are dramatically scaling back their practices or retiring early.

Doctors say that high awards for pain and suffering and other “non-economic damages” granted by juries are the primary reason for the higher premiums, and that imposing a cap on those awards would effectively rein in double-digit increases in premiums. The issue goes well beyond dollars-and-cents for the physicians, they say, extending to a quality-of-care dilemma for their patients.

Trial lawyers who represent plaintiffs in medical malpractice suits, however, say the caps would restrict their clients’ right to collect fair compensation for pain and suffering. They further say that the root of the problem lies in the cyclical nature of the insurance industry, and that doctors should be pushing for premium reform through the state’s insurance commisioner.

On Thursday, Angel plans to join about 100 physicians from throughout the state at the Capitol in a rally to support a bill that would cap non-economic damages to $250,000. The event is being coordinated by the Iowa Medical Society.

“The doctors have never asked to rally about anything before,” said Mike Abrams, executive vice president of the Iowa Medical Society. “This is one issue where the grassroots level has said, ‘Set a time and date and we’ll be there.'”

Though Iowa is not among the 19 “crisis states” for medical malpractice premiums identified by the American Medical Association, it is on the verge of reaching that designation, Abrams said.

To date, 33 states have legislated some level of cap on non-economic awards. The caps have been challenged in 15 of those states, and eight of those states’ supreme courts have ruled them unconstitutional.

Although the U.S. House last year passed a measure to extend a national cap of $250,000 on non-economic damage awards, the bill has not made it past the Senate. Last week a more limited measure, which proposed capping damage awards against obstretrical/gynecological physicians who are sued, failed passage in the Senate.

The bill now being considered by the Legislature, House File 2202, is a step in the right direction, said Dr. Tom Evans, vice president and chief medical officer for Iowa Health System and president of the Iowa Medical Society.

“Because there is so much variability in how those awards are given, we believe the caps can effectively even that out,” he said.

The issue revolves around patient care, Evans said.

“We believe that the health-care infrastructure of the state is becoming increasingly fragile, both with the number of doctors and doctors per capita in Iowa,” he said. “This is about access to care; this is resulting in doctors limiting their practice.

“The thing that concerns me the most is we’re beginning to have surgeons limit their scope. When surgeons trained to do a wide scope decide to limit their practice to what’s low-risk, that means less availability and longer waiting times.”

The physicians’ group says that caps on non-economic damages have worked in California, which has experienced about one-fifth the growth in malpractice insurance premiums than the rest of the country, according to data provided by the IMA.

Caps do not address the problem of high premiums, said Scott Brown, executive director of the Iowa Trial Lawyers Association.

“It would put the burden on the person that’s been injured,” said Brown, who said that economic damages for lost wages do not extend to non-wage-earning spouses or children who are injured.

“Non-economic damages have a real value,” he said. “We should not be capping the quality of life of Iowans.”   Brown said California only saw reduced malpractice premiums because of reforms instituted several years after the caps were imposed. Until that time, premiums continued to rise, he said.

The doctors should be asking for the state insurance commissioner to take an advocacy role in reviewing rates of Iowa companies, said Rob Tully, a West Des Moines trial attorney. A five-year review of rates in Minnesota resulted in the commissioner there ordering a 25-percent rate rollback in the mid-1980s, he said.

Tully said Iowa’s doctors have raised an alarm on this issue about every 10 years, when a poor economy causes investors to raise premiums to compensate for declining investment performance.

Two years ago, Iowa’s insurance commissioner conducted a study of medical malpractice rates after a major carrier, the St. Paul Cos., stopped writing medical malpractice policies in Iowa, said Tom Alger, a spokesman for the state insurance department.

“While (the doctors) came into that with a number of concerns, afterward they did feel there were things opening up in the market at that point, that some companies were coming in to fill that gap,” Alger said. If the department had found there was not sufficient competition, he said, it would have authorized a joint underwriting authority, a pool of insurance companies that would spread the risk.   However, while that arrangement would ensure availability of coverage, it wouldn’t necessarily stabilize premiums, he said.

In 2002, the latest year for which statistics were available, Midwest Medical Insurance Co. wrote 41 percent of the medical malpractice policies in Iowa and raised premiums by an average of 12 percent, according to Alger. Premium increases in 2002 ranged from 12 percent to 73 percent on average among the top four companies in the market, which accounted for about 70 percent of the state’s market share.

“These are very significant increases,” Alger said, “but they’re happening all over the country. While our experience is (that) it is a problem, it’s less of a problem in Iowa than in other parts of the country.”

The trial attorneys say doctors should demand better rates from the insurance companies.

That sounds good on the surface, Evans said, “but we don’t have a lot of leverage.What happens is the insurance companies can say, ‘We won’t provide coverage here.’ You have to have coverage, so they’ve got you over a barrel.”

Angel said that malpractice insurance is increasingly becoming “mal-occurrence” insurance, as doctors are sued for bad outcomes regardless of whether there was negligence.

“If you practice high-risk medicine, you are going to have some bad outcomes,” he said. The legal system as it is now is penalizing both patients and physicians by pursuing frivolous cases that undermine the cases that do have merit, he said.

“The crisis is in the legal industry,” Angel said. “Maybe the problem is how the trial lawyers manage their system. When there are bad patient outcomes, the doctors don’t blame the pharmaceutical companies; they don’t blame the patients. Maybe laywers ought to take a page out of our notebooks and look at that.”

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