| Copyright: | (c) 2011 A.M. Best Company, Inc. |
| Source: | A.M. Best Company, Inc. |
| Wordcount: | 950 |
A new pilot program in New York affecting how some medical malpractice cases are handled has prompted insurance companies and trial lawyers in the state to do something they don't often do -- agree. The two camps both say a program in which judges with some degree of medical knowledge wade into settlement negotiations earlier in the process to help usher those discussions along is a positive move for the system.
The approach, known as judge-directed negotiation, is one that New York State Supreme Court Justice Douglas McKeon has helped develop in recent years. He launched the program in the Bronx, and thanks to a $3 million federal grant, the state is working to expand it into other jurisdictions.
The theory is that discussions will be moved along more quickly by getting a judge involved earlier and more often in the settlement process.
Donald Fager, vice president of the Medical Liability Mutual Insurance Co., said the program could go a long way in reducing litigation costs in suits against hospitals and doctors. "The sooner we can resolve these kinds of cases, the better off everyone involved will be," Fager said. MLMIC is the nation's largest writer of medical professional liability insurance, even though it only writes policies in New York.
Nicholas Timko, the president of the New York State Trial Lawyers Association, echoed that sentiment, saying, "What Judge McKeon has done is create a model process that could go a long way in making the litigation process more efficient."
Insurers and trial attorneys also agree that judge-directed negotiation is a far from perfect system, though each side differs on where the negatives come in.
Fager said the program could help weed out meritless claims earlier in the process.
He noted more than 70% of the cases filed against MLMIC's policyholders are resolved without a payment being made. That means the company is not necessarily in favor of creating a system where settlements are overly encouraged, he said. "In cases where we feel there is no merit to the claim, we would be fully prepared to fight that claim vigorously," Fager said.
Timko said while the program would help move some cases along more quickly, he wants to ensure it continues to include safeguards built into the traditional civil litigation system that are designed to protect plaintiffs. That includes the right to an attorney and protections against being forced into a settlement that pays less than an injury or death is worth, Timko said.
Carol Liebman, a law professor at Columbia Law School who has studied mediation and other dispute resolution techniques, said she had concerns about the judge-directed approach to settlement negotiations becoming too heavily focused on the financial resolution of the case. As the program expands across the state and potentially into others, Liebman said the judges need to ensure plaintiffs have a chance to address the doctors and hospitals that have allegedly harmed them or their families.
"Research has shown over and over again that claimants in these kinds of cases want some kind of compassion or apology from caregivers, and they want to know that whatever happened won't happen again," Liebman said. "If the process becomes solely about getting a financial resolution that both sides can agree with, claimants aren't going to get that emotional resolution that is so important to them and to the betterment of health care providers who become able to learn from their mistakes."
Barry Washor, of Queller, Fisher, Washor, Fuchs & Kool, said "emotional resolution" of a case is often more important to clients than the financial resolution. Washor, who has handled cases in which McKeon directed the settlement negotiations, said McKeon has proven to factor in those plaintiff concerns into how he oversees a case, often bringing plaintiffs and defendants together into the same room along with their attorneys. But Washor said he wondered whether that would remain the norm as the program continues to expand.
Besides, Washor said, having plaintiffs and defendants hearing each other's position can actually help speed up the resolution process. "Often if claimants hear an explanation for what happened, it helps them understand why something may have happened and that may make them more reasonable during the discussions. The same is true for hospitals and doctors who hear about the impact of an alleged injury," Washor said. "It's helpful for everyone to have that information exchange."
New York is also considering a number of other tort reform efforts, including the recent approval of a measure that sets up a liability fund to cover the future medical expenses of children who are neurologically injured at birth.
The legislation should help hospitals and institutions who carry $4 million to $5 million in coverage for liability.
But because the fund does not cover costs including past medical expenses, pain and suffering, lost future income and attorney fees associated with future medical costs, it isn't likely to be of much help to physicians, according to critics of the fund. Physicians are required to carry $1.3 million in liability in New York state to gain access to a state-paid $1 million excess layer.
In another positive sign for insurers and caregivers, in May the state considered, but ultimately failed to pass a measure that would have capped pain-and-suffering costs at $250,000 (BestWire, May 12, 2011).
The top five writers of medical professional liability in New York in 2010, according to BestLink, which provides online access to A.M. Best's database of insurance information, were: MLMIC Group, with a market share of 40.5%; Physicians Reciprocal Insurers, with 25.9%; Hospitals Insurance Co. Inc., with 11.4%; American International Group, with 3.5%; and Academic Health Professionals Insurance Association, with 3.4%.
(By Jeff Jeffrey, Washington Correspondent: mailto:jeff.jeffrey@ambest.com)
