By Dr. Theodore D. Fraker Jr.
For the past two years, the physician community has been on a roller-coaster ride. Specifically, physicians have been fighting on two fronts for important changes that have a direct effect on patient access to quality health care.
First, there has been the battle to ensure that Medicare reimbursement is keeping up with the cost of providing care to patients. Second has been the effort at the federal level to reform the medical liability system in the hope of stemming the crisis, which already exists in many states.
In late February, the roller coaster tempered its pace, as Congress passed legislation to prevent reductions in physicians' 2003 Medicare reimbursement. This was only after a significant reimbursement reduction in 2002 forced some physician practices to stop taking Medicare patients altogether. Many other practices made less drastic changes (such as reducing staff) that, in one way or another, affected patient access to care.
Meanwhile, with more than one-third of states considered to be in a medical liability crisis, the battle for liability reform has raged on. The skyrocketing cost of liability insurance for physicians in many parts of the United States is tearing the health care system apart. Physicians who have never had a claim filed against them have seen increases of anywhere from 25 to 100 percent. Physicians in traditionally high-risk specialties such as neurosurgery have seen increases of as high as 200 percent.
Fortunately, we managed to get a sound liability reform bill passed in Ohio. But by no means did we escape unscathed. A recent American Medical Association/Ohio State Medical Association survey found that the medical liability crisis has caused nearly two-thirds of high-risk specialists to change the way they practice. In addition, it will likely take up to two years for the new law in Ohio to help stabilize rates. Meanwhile, physicians will still continue to see malpractice premium increases as high as 50 percent.
Two of the most important causes of this dramatic jump in liability premiums are runaway jury awards and a liability system in which lawsuits that are dismissed cost nearly $25,000 (on average) for a physician to defend.
There are numerous statistics that highlight the problem. For example, between 1996 and 1999, the average medical liability award jumped by 76 percent. In 1999-2000, more than half of all jury awards in medical liability cases exceeded $1 million. Sadly, in many cases, plaintiff/patients see only half of this money, with attorneys walking away with 30 to 50 percent of the jury award, plus additional monies to cover their costs.
While there is support in Congress for a liability reform bill that has been strongly backed by the physician community, its passage is by no means assured. The House has already passed the bill, called "The HEALTH Act," which contains proven reforms, (including caps on noneconomic damages) that have helped to keep liability premiums in check in several states. Under "The HEALTH Act," plaintiffs would have the right to full recovery of economic damages, such as lost wages and medical expenses. Damages that are difficult to quantify, such as those for "pain and suffering," would be held to a reasonable cap. These pain-and-suffering damages, also referred to as noneconomic damages, are a primary contributor to the excessive awards often granted in liability cases.
In April, negotiations in the Senate on a compromise liability reform bill screeched to a halt. Next, there was the announcement that there is likely to be another significant reduction in Medicare reimbursement in 2004, with additional cuts projected through 2007. According to a recent report, for example, the median total cost for operating a cardiovascular practice rose in 2001 by nearly 16 percent (the most recent year for which data are available). The increase in cardiovascular specialists' Medicare fees in 2003: 2.2 percent on average.
The combination of seriously lagging reimbursement and escalating liability insurance costs are causing older physicians who are tired of dealing with a system in perpetual tumult to retire and other physicians to no longer perform certain high-risk procedures. Meanwhile, practices are being forced to lay off clinical staff and forego the purchase of new equipment.
To be sure, physicians, largely through their professional organizations, have expended a great deal of energy and resources in fighting for liability reform and better reimbursement from Medicare. We are now taking steps to reach out more to our patients, putting educational materials in our waiting rooms, perhaps even discussing them in the course of an appointment.
This is something that most physicians would rather not do. But physicians feel their very ability to practice medicine and provide quality care to patients is at risk, and drastic steps must be taken.
Theodore D. Fraker Jr., MD, FACC is immediate past president of the Ohio Chapter of the American College of Cardiology.
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