MEDICINE : Studies Challenge AMA View on Evils of Malpractice Suits

New studies by a Harvard University group and the Urban Institute have challenged some longstanding contentions by physicians who assert that they often are unfairly victimized by the wave of medical malpractice suits.

Specifically, they have found that:

--Although physicians often complain--correctly--that damage awards in malpractice cases typically are far larger than those in auto injury cases, the studies show that only one out of every eight probable malpractice victims ever files a claim and only about half of those eventually win their cases.

--Contrary to contentions by physicians’ groups, lawyers have no bigger financial incentives to handle medical malpractice suits than to accept other kinds of liability cases. And juries are not any more hostile to physicians than to other occupational groups.

The Harvard report, based on a study of New York state hospitals during the mid-1980s, was recently published in the New England Journal of Medicine.

“It is a total illusion to suppose that we have a great excess of (medical malpractice) litigation,” said Paul C. Weiler, a Harvard law professor who is one of the authors of the document.

BACKGROUND: The controversy over medical malpractice litigation has been raging since the mid-1970s, when the number of claims and the size of court judgments increased dramatically, sending malpractice insurance rates skyrocketing.

According to the American Medical Assn., the number of claims per 100 physicians more than doubled between 1982 and 1989--from 3.2 in 1982 to 7.4 in 1989. The AMA predicts that 38% of all physicians will face suits sometime--78% in obstetrics and gynecology.

At the same time, AMA figures show that insurance premiums for professional liability policies soared by 167% between 1982 and 1989, sending the average fee paid by physicians for liability insurance to more than $15,000 a year--with those for high-risk specialties far higher.

That, in turn, pushed overall medical-care costs even higher and prompted some physicians to turn to “defensive” medicine--ordering more tests for patients as a guard against possible malpractice suits later.

“We believe that the cost of liability adds to the cost of health care,” said Martin J. Hatlie, director of the AMA’s department of professional liability and insurance.

But AMA estimates show that in 1989, the last year for which figures are available, physicians spent $5.6 billion on liability insurance and $15.1 billion on defensive medicine--less than 3% of the $604.1 billion that Americans spent on medical care that year.

The Bush Administration has proposed a plan that would press states to limit the size of non-economic damages awarded in malpractice judgments and to provide alternatives to jury trials, such as arbitration panels.

For its part, the AMA has developed its own malpractice tort-reform plan that calls for establishing state arbitration boards to handle malpractice and medical disciplinary cases.

But it is also supporting Bush’s plan and a rival by Sen. Pete V. Domenici (R-N.M.) that would require beneficiaries of federal health care programs and tax-deductible company health plans to resolve disputes through binding arbitration instead of the courts.

But Harvard’s Weiler, who advocates a no-fault system of compensation for incidents of malpractice, said that those plans favor physicians and ignore the concerns of patients. Moreover, critics point out that consumers do not always like having to rely on alternatives to jury trials. A General Accounting Office study last year showed that only 800 claimants used Michigan’s voluntary arbitration plan between 1976 and 1989, while 20,000 others filed suit.

OUTLOOK: Most analysts say that the nation seems likely to overhaul the current malpractice system sometime in the next few years, but probably as part of a more comprehensive reform of the medical system now being considered by Congress.

Randall Bovbjerg, author of the Urban Institute study, pointed out that the various sides are far from reaching a consensus. “Everyone has a legitimate beef and everyone has to give something in the solution,” he said.