A New Year; A New Look at MICRA

Caps on damages in medical negligence cases are making it increasingly difficult for a growing number of patients, injured by preventable medical mistakes, to access our courts.

When Dr. Smith saw Teresa, a 29-year-old single woman, in 2005, she was concerned about what felt like a small lump in her breast. Because she did not have a family history of breast cancer and because she was so young, Dr. Smith decided not to order a mammogram, even though good medical practice required that he do so.

Eighteen months later, Teresa is dying of breast cancer. The tumor she had has grown and spread. What would have been a treatable disease, if Dr. Smith had acted as a reasonably careful physician, is now a death sentence.

Under our civil justice system, Teresa suffered a serious harm for which the law says she should be compensated. Compensation is intended to accomplish two goals: the first is to hold Dr. Smith accountable for the injury to Teresa caused by his negligence; the second is to discourage future negligence by Dr. Smith and others in similar circumstances.

In California, if Teresa files a lawsuit, the most she can recover because her doctor didn’t order a routine test as he was required to do, is $250,000. After the cost of hiring expert witnesses, filing fees, court reporters and after attorneys’ fees of 20-25% are paid, Teresa will receive compensation of perhaps $100,000 to $125,000 for the premature ending of her life due to a careless medical error.

In 1975, doctors were under pressure because of rising malpractice insurance rates. The California legislature responded by passing the Medical Injury Compensation Reform Act or MICRA. That law capped noneconomic damages for patients injured by the negligence of health care providers at $250,000, among a myriad of other changes which, it was hoped, would bring down insurance rates for physicians.

Unfortunately, it didn’t work. Doctors did not see any benefit from rising insurance rates until the late 80’s, when insurance reform was passed in California. In retrospect, it is clear that lawsuits had a great deal less to do with the increase in insurance rates than did a sinking stock market. The real beneficiary of MICRA has been the insurance industry.

In 1975, $250,000 would have bought a Beverly Hills Mansion; today, one would be lucky to find a two-bedroom condominium in a reasonably nice part of town for that sum. Why hasn’t the law changed to reflect the rising cost of living, as well as the soaring cost of litigation-related expenses? Does the benefit of caps to doctors outweigh the detriment to victims of medical negligence? What is the impact on society of immunizing health care providers from liability for their medical mistakes? These are questions that, at the beginning of 2007, need to be examined.

The first question is easy. The caps on damages haven’t risen because the insurance industry and medical associations donate huge sums to the politicians who are in a position to effect change. Patients like Teresa, whose lives have been ravaged by medical mistakes, do not have comparable political power. They are mostly invisible victims of MICRA. Those who advocated for caps in 1975 knew that over time their value would decrease to a point where it would be impractical or impossible for patients like Teresa to bring a lawsuit.

Predictably, as a result of the stagnant cap, the number of medical malpractice cases filed in our courts each year has dropped dramatically. If this represented fewer patients being injured by medical errors, the decrease in cases would be something to applaud. Unfortunately, the number of people who die each year because of preventable medical mistakes, estimated at between 44,000 and 100,000, has not changed appreciably since the Institute of Medicine published its report, To Err is Human: Building a Safer Health System in 2000. http://www.nap.edu/books/0309068371/html/

Can the cap be justified because it helps keep down insurance rates for physicians? Probably not. In September 2003, Texas passed a Constitutional amendment to cap damages in medical negligence cases. A month later, G.E. Medical Protective Company, the largest medical malpractice insurer in Texas, applied to the insurance commissioner for a 19% increase in rates, noting that the cap on damages would have no more than a 1% impact on its costs. http://www.consumerwatchdog.org/malpractice/rp/2059.pdf

If capping damages for patients who are injured by medical mistakes isn’t helping keep down insurance rates appreciably, what impact is it having? This is a more difficult question to answer. Certainly, fewer patients like Teresa can ever hope to recover even a fraction of the value of the injury they have suffered. It is the public policy ramifications of immunizing health care providers from responsibility for the injuries that they cause that is most troubling.

If there is no consequence for shoddy medical practices, if doctors and nurses will not, as a practical matter, be held accountable when they cause preventable injuries, what is the motivation to improve medical practices? The conscientious will still strive for excellence, of course; these are the medical professionals unlikely to be named in a malpractice case in the first place.

It is estimated that a high percentage of medical errors are made by a small number of health care workers. Disciplinary action by medical boards or professional associations against repeat offenders is notoriously lax. Therefore, the only way to identify and discourage poor medical practice may be the threat of litigation. If there is no threat, doctors who are not motivated to practice within accepted medical standards are free to disregard the safety of their patients with impunity.

The caps on damages have other potential consequences that are quite chilling. In California, only noneconomic damages are limited by MICRA. Patients who lose substantial income or who will require expensive future medical care can, theoretically, recover those losses, which may be substantial.

The death of a child or someone who is retired, on the other hand, has no “economic” consequence to speak of. Regardless of how egregious the negligence that caused the death to occur, the family will recover a maximum of $250,000 for their loss.

If you take your child to a hospital for a routine surgery and something goes wrong during the procedure, causing significant injury, what will be the response of the health care team responsible for her care? We would like to think that everything that could be done to save the life of a child would be done and most often this is probably the case. However, are we confident that economics will never enter into the decision-making process?

A child may suffer a permanent brain injury from a surgical mistake, but this might not be apparent in the precious few minutes during which aggressive treatment will save the child’s life. If the child survives with such an injury, the cost of future care (the economic damages) could cost millions, a lawsuit is likely. If the child dies on the table, the family can recover no more than $250,000 and, for that reason, may be unable to file a legal claim.

We don’t want our physicians making health-care decisions based on their economic interest. We want and expect them to be made based on what is in the best interest of the patient. As the health care costs which comprise economic damage continue to outpace inflation and the value of the non-economic cap continues to decline, the ecomomics of MICRA are increasingly likely to impact the medical decision-making process.

Despite the occasional whacky jury verdict and the calls for reform, our civil justice system has worked very well – to discourage negligent practices, to protect the public and to place legal responsibility for injuries where it belongs. Caps on damages in medical negligence cases do not serve their intended purpose – of significantly cutting insurance rates for doctors, are counter-productive when it comes to increasing patient safety, and work a serious injustice to people who are seriously injured or killed because of preventable medical errors. Immunizing health care workers from injuries caused by their poor medical practices makes no more sense than immunizing poor drivers from the havoc they can cause behind the wheel of a car.

In 2007, I would ask our politicians to re-evaluate MICRA and agree with me that it should be changed, if not done away with altogether. Help me call for that re-examination by contacting your State Assemblyperson and State Senator and expressing your concern about the impact of this 32-year-old law is having on people like Teresa. http://www.leginfo.ca.gov/yourleg.html


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