At the Intersection of Health, Health Care and Policy Cite this article as: Allen Kachalia, Alison Little, Melissa Isavoran, Lynn-Marie Crider and Jeanene Smith Greatest Impact Of Safe Harbor Rule May Be To Improve Patient Safety, Not Reduce Liability Claims Paid By Physicians Health Affairs, 33, no.1 (2014):59-66 doi: 10.1377/hlthaff.2013.0834

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Malpractice Reform By Allen Kachalia, Alison Little, Melissa Isavoran, Lynn-Marie Crider, and Jeanene Smith 10.1377/hlthaff.2013.0834 HEALTH AFFAIRS 33, NO. 1 (2014): 59–66 ©2014 Project HOPE— The People-to-People Health Foundation, Inc.

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Greatest Impact Of Safe Harbor Rule May Be To Improve Patient Safety, Not Reduce Liability Claims Paid By Physicians “Safe harbor” legislation that provides liability protection to physicians when they follow designated guidelines is often proposed as a way to reform the malpractice system while improving patient safety. However, published evidence provides little policy guidance on implementing safe harbors. With the support of an Agency for Healthcare Research and Quality planning grant, we conducted an empirical analysis of closed liability claims in Oregon to determine the potential effects of hypothetical safe harbor legislation. We found that such legislation would have changed the liability outcome in favor of the physician defendant in only 1 percent of 266 claims from the period 2002–09 that we reviewed. Nevertheless, if safe harbors can induce greater physician adherence to care guidelines, they have the potential to improve patient safety. Implementing safe harbor legislation, however, requires overcoming a number of hurdles, including selecting and updating approved guidelines, obtaining broad stakeholder support, and withstanding challenges to the legal validity of the legislation. More experimentation with safe harbors is needed to determine their effects on the performance of the liability system and on health care quality and costs. ABSTRACT

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fforts to improve patient safety have increased tremendously over the past decade, but the rate of preventable injuries in the United States remains high.1–3 Recent studies have estimated that 6–16 percent of hospitalizations result in preventable injury.1,3 When harm does occur, the medical liability system’s inaccuracies and inefficiencies4–6 may frustrate patients and providers alike. Malpractice claims take an average of three to five years to resolve, and approximately 25 percent of claims with merit do not result in compensation, while 25 percent of claims without merit do result in compensation.7,8 An increasing amount of evidence demonstrates that most traditional tort reforms, such as imposing damages caps and shortening the

Allen Kachalia (akachalia@ partners.org) is associate chief quality officer of Brigham and Women’s Hospital, in Boston, Massachusetts. Alison Little is medical director of the Center for Evidence Based Policy, Oregon Health and Science University, in Portland. Melissa Isavoran is a senior policy analyst at the Office for Oregon Health Policy and Research, Oregon Health Authority, in Portland. Lynn-Marie Crider is an attorney and policy analyst at Local 49 of the Service Employees International Union, in Portland. Jeanene Smith is administrator of the Office for Oregon Health Policy and Research and chief medical officer for the Oregon Health Authority.

time periods in statutes of limitations, do little to address physicians’ concerns about liability.9,10 Traditional tort reforms do not reduce the number of claims against physicians and, with the exception of liability caps, do not lower physicians’ premiums.9,10 In 2010 the Agency for Healthcare Research and Quality funded several demonstration projects and planning grants that sought to identify much-needed improvements in patient safety and in the performance of the medical liability system.11 One of the projects funded was an empirical evaluation of how well safe harbors could simultaneously address both problems. Safe harbors are legal provisions designed to provide liability protection to physicians when they follow guidelines or standards that are either approved by the state or promulgated by J a n u a ry 201 4

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Malpractice Reform organizations such as medical societies with state approval.12–15 Safe harbors are also designed to address physicians’ frustration with the medical liability system by attempting to shorten or eliminate the long and arduous process of resolving claims and to reduce the frequency with which physicians must defend against or pay claims that do not involve negligence—which have been estimated to account for 40–86 percent of all malpractice claims.4,8,16 The liability protection afforded by safe harbors is also intended to create incentives for physicians to follow evidence-based guidelines, thereby addressing costly gaps in quality and safety. One large study found that patients receive recommended care less than 55 percent of the time, highlighting the need for improved adherence to evidence-based practice.17,18 By reassuring physicians that adhering to guidelines—even when they recommend fewer tests or procedures than a patient desires—will confer legal protection, safe harbors might also reduce the practice of defensive medicine, which would further lower health care costs.19 If safe harbors were used to define the standard of care and could also be used by patients to prove liability, they could benefit patients who receive suboptimal care by improving or expediting access to compensation. Despite these numerous theoretical benefits, safe harbors have not been widely tested, and there is little published evidence about their effects.10,12,13 Maine, Minnesota, Florida, and Vermont conducted demonstration projects on safe harbors in the 1990s.10,12,13 Maine’s program adopted practice guidelines in just four specialties, and only once during the five-year demonstration were these guidelines employed as a defense.13,20 The program ended without yielding clear evidence that safe harbors lowered liability risk. Florida’s program was restricted to guidelines for cesarean sections.21,22 The state concluded that there were insufficient data to assess the impact of the program on claims or premium costs, and it ended the program after about four years.21,22 No information is available on the results of the programs in Vermont and Minnesota.10 Collectively, these demonstration projects had low participation rates and covered a small number of specialties—two limitations that would have reduced the generalizability of their findings. In addition, all of the projects ended in the 1990s without providing clear evidence on the clinical or legal effects of safe harbors. Commentators have provided explanations for these early projects’ lack of success.12,13 Probably the most notable barriers at the time were wide60

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spread concern about the scientific validity of guidelines and limited support for their use, since the practice of evidence-based medicine was still in its early days.12,13,20 However, perhaps because of a broader recognition of the need for adherence to scientific evidence as a way to improve quality and reduce costs, policy makers and members of Congress now have a renewed interest in safe harbors.13,19,23,24 Not only is the process for developing guidelines today vastly improved compared to the situation in the 1990s, but there are more guidelines with a stronger evidence base supporting their use. Physicians are also relying more on guidelines as a means of reducing the costs of care.19,25 Consequently, it may now be possible to overcome some of the challenges involved in implementing safe harbors twenty years ago. With the support of a planning grant from the Agency for Healthcare Research and Quality, the Oregon Health Authority analyzed the potential for safe harbors to improve patient safety and the performance of the medical liability system, as well as legal challenges and stakeholder concerns that might arise with legislation enacting safe harbors.26 Here we report the findings of the project.

Study Data And Methods Overview The project consisted of the following three components: a retrospective review of closed claims to assess the potential effect of safe harbors on patient safety and malpractice claims; a brief legal analysis of the feasibility of and challenges to legislation enacting safe harbors; and the collection of stakeholder perspectives on safe harbors. The Oregon Health Authority’s Office for Oregon Health Policy and Research conducted the project, in collaboration with the Oregon Patient Safety Commission and the Center for Evidence-Based Policy. The Institutional Review Board of the Oregon Public Health Division approved the project. Three of the authors (Melissa Isavoran, LynnMarie Crider, and Jeanene Smith) were employees of the Oregon Health Authority, one (Alison Little) was an employee of the Center for Evidence Based Policy, and one (Allen Kachalia) was a study consultant from Harvard Medical School during the project and its analysis. Claims Analysis The retrospective claims analysis was conducted using records maintained by the Doctors Company, the largest physician liability insurer in Oregon. The analysis did not include claims against self-insured institutions or the physicians they covered.We evaluated all 907 cases that were closed in the period 2002–09—which, according to the Oregon Med-

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Despite numerous theoretical benefits, safe harbors have not been widely tested.

ical Board, represented 34 percent of the 2,632 liability claims made in Oregon during this period. The claims were first assessed by project staff members, who used brief descriptions of the cases from the Oregon Medical Board database to determine whether the claims involved a common diagnostic or medical management issue that was likely to be subject to a guideline. The goal of this initial screening was to narrow the number of claims that would require detailed review by a physician. Claims for which there was insufficient information in the database or that were related to informed-consent issues were excluded. Claims alleging damage that had been caused purely by execution—for instance, laceration during surgery or a foreign object left in the patient’s body—were also excluded because these types of actions have historically been less amenable to guidelines. Eight physician reviewers were trained to review the remaining claims to determine whether the implementation of safe harbor legislation might have changed patient safety or liability outcomes. This training consisted of a four-hour orientation session that provided the physicians with an overview of the project, the necessary legal background, an orientation to the claims file, and detailed instructions on how to complete the data abstraction form. All of the physicians also reviewed and discussed one claim to check for and achieve consistency in their reviews. The reviewers had no special background in claims review or malpractice and came from a variety of clinical backgrounds, including general surgery, pediatrics, family practice, and public health. Claims were randomly assigned to the reviewers. The reviewers had information about the claims that included the claim’s allegation, the defense attorney’s analysis and correspondence, relevant portions of the medical record, expert opinions, depositions, summary memos, and the claim’s final disposition. Interreviewer reliability testing was not conducted because of time

and resource constraints. Reviewers were asked to determine first whether a guideline in the National Guideline Clearinghouse applied to the care in question in each claim.27 To improve the probability that the selected guidelines reflected the science available at the time of the injury, the group of guidelines was limited to those published before or as close as possible to the year in which medical treatment associated with the claim was provided. If a guideline did not apply, the review stopped. If a guideline applied, the reviewer was asked to analyze the likely impacts of two types of applications of safe harbor legislation. In one type, the safe harbor would act only as a “shield” for physicians, meaning that it protected physicians from liability if they had adhered to the applicable guideline. In the second type, the safe harbor would also act as a “sword” for patients, meaning that if the physician had failed to follow a guideline, patients seeking compensation could use the safe harbor to demonstrate a violation of the standard of care. If more than one guideline applied, the reviewer was asked to determine if the guidelines differed substantially. If they did not, the reviewer simply listed the number and title of the applicable guidelines in the data abstraction form. If the guidelines were different, the reviewer was instructed to complete a separate form for each conflicting guideline. For all claims with applicable guidelines, the reviewers also recorded the type of alleged error, the severity of injury, how likely it was that the physician had deviated from the guideline, and how likely it was that adherence to the guideline would have prevented the injury. Brief Legislative Analysis The Oregon Department of Justice conducted a brief analysis of the legal and statutory issues that would need to be addressed before the state could enact legislation implementing safe harbors. Although this analysis was based on Oregon statutory and case law, many of the findings should be relevant to the implementation of safe harbor legislation in other states as well. Stakeholder Perspectives The claims findings and legislative analysis were presented to six stakeholder groups concerned with medical liability and patient safety in Oregon. These were the Oregon Medical Association; the Oregon Association of Hospitals and Health Systems; the Oregon Trial Lawyers Association; the Oregon Health Services Commission; the Oregon Patient Safety Commission; and a consumer advocate group that included representatives from AARP and the Oregon Health Care Quality Corporation, a multistakeholder organization that leads January 2014

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Malpractice Reform community-based initiatives to improve the quality and affordability of care and patients’ experiences. The Oregon Health Authority engaged leaders of each of the six stakeholder groups in a facilitated discussion about the study findings to determine whether there was interest in moving forward with the proposed implementation of safe harbor legislation in Oregon. Limitations Our analysis has several limitations. First, the claims reviewed were from only one state and did not include claims against hospitals and health systems. Second, the claims analysis was subject to the limitations of any retrospective analysis: namely, variation in reviewer judgments that can affect validity28 and the inability to assess unintended consequences that might arise after a new policy is implemented (for example, the existence of safe harbors might affect the quality of the promulgated guidelines). However, our goal was not to quantify the impact of safe harbors on patient safety or the liability system. Instead, it was to estimate ex ante whether there exist adverse events and claims that could be avoided through the use of safe harbors. Third, not all of the 907 claims were reviewed in detail, but all were first screened for guideline applicability. It is difficult to predict how many of the claims that were excluded at this point might have been subject to a guideline. However, this limitation probably means that our estimate of the impact of safe harbors is conservative.

Study Results

◀

13.6 million

$

Saved If the adverse outcomes we observed had been prevented, $13.6 million in compensation costs could have been saved.

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Claims Overview Of the 907 claims that were screened for guideline applicability, 266 (29.3 percent) were selected for physician review. Of these 266 claims, 48.1 percent were related to a missed or delayed diagnosis, 16.5 percent to a technical complication, 12.4 percent to a delay in treatment, 9.4 percent to nonsurgical management, 7.1 percent to postoperative management, and 6.5 percent to a broad range of other allegations. The physician-reviewers determined that at least one guideline applied in 133 of the claims (50 percent). Injuries in these cases varied widely in type and severity. They included cerebral palsy, ruptured aortic aneurysm, testicular torsion, and opioid addiction. Guideline Adherence And Clinical Outcomes In the 133 claims in which guidelines applied, reviewers indicated that physicians had adhered to the guidelines in 68 cases (51.1 percent) but departed from them in 65 cases (48.9 percent). In 41 of the 65 cases (63.1 percent), reviewers estimated that adher-

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In the absence of a safe harbor, adherence to guidelines appears to be already protecting physicians from paying claims without merit.

ence to the relevant guideline would likely have avoided the adverse outcome. Conversely, in six of the sixty-eight cases (8.8 percent) where the physician had adhered to a published guideline, the adverse outcome might have been avoided if the clinician had deviated from the guideline. In five of these six cases, reviewers raised doubts about whether the guideline applied or clearly recommended a treatment. For example, in one of the five cases a clinician followed guidelines recommending against routine screening of low-risk patients for elevated prostate-specific antigen levels (a test for prostate cancer), and a low-risk patient who was not screened was later discovered to have prostate cancer. In the sixth case, deviation from the guideline might have prevented the adverse outcome: In accordance with guidelines, prophylactic anticoagulation was not prescribed for a low-risk patient after ankle surgery, and the patient developed a pulmonary embolism. This claim did not result in a payment. Claims Resolution And Compensation Costs As noted above, reviewers determined that forty-one adverse outcomes could likely have been prevented if guidelines had been followed (Exhibit 1). If the adverse outcomes had been prevented, $13.6 million in compensation costs could have been saved. Reviewers concluded that of the forty-eight claims in which a plaintiff received an indemnity payment (the payments totaled $20,942,752), under safe harbor legislation the plaintiff would not have received payment in three of them (6.3 percent), saving a total of $373,900 in compensation payments. The following allegations were made in those three claims: failure to prescribe antibiotics to a surgical patient who developed a wound infection, failure to admit a patient with pneumonia to the hospital, and failure

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Exhibit 1 Estimated Clinical And Legal Effects Of Safe Harbors On Closed Medical Liability Claims In Oregon, 2002–09 Claims reviewed by physicians (n=266)

Total claims sample (N=907)

Number of claims or dollars affected

Percent of claims or dollars affected

Percent of claims affected

Claims reviewed Adverse outcomes likely prevented with safe harbor

266 41

—a 15

—a 5

Claims in which payment would likely have been avoided with safe harborb

3

1.1

0.3

Uncompensated claims in which payments would likely have been made with safe harborc

14

5.3

1.5

Compensation costs saved through likely prevention of adverse outcomes with safe harbor

$13.6M

39

29

SOURCE Authors’ analysis. aNot applicable. bThe safe harbor would act as a shield for the physician, as explained in the text. cThe safe harbor would act as both a shield for the physician and as a sword for the patient, as explained in the text.

to screen a patient with pneumonia for lung cancer. If safe harbor legislation had also been available to plaintiffs as a sword, fourteen of the eighty-five claims (16.5 percent) that went without payment might have resulted in compensation (Exhibit 1). However, in many of these cases reviewers questioned whether a guideline was applicable or made a clear recommendation. Number Of Guidelines Required Reviewers used 143 guidelines published by sixty different entities to evaluate the 133 claims in which guidelines applied. The most frequently applicable guideline pertained to the prevention of venous thromboembolism: It applied to five claims. Guidelines relating to the management of unstable angina, management of palpable breast masses, prevention of surgical site infections, and perioperative management each applied to four claims. In all but three of the claims, only one guideline applied. Brief Legislative Analysis After the claims review was completed, the Oregon Department of Justice identified several legal issues related to crafting valid safe harbor legislation. The department found that although published guidelines were admissible as evidence of the standard of care, they were not dispositive: In other words, although state endorsement of guidelines would add more evidentiary weight to those guidelines and could even be used to define the standard of care, the guidelines could still be subject to attack. For example, experts could claim that other reasonable courses of action existed for the provider to follow, or that the guidelines did not apply in a particular case. Safe harbor legislation could be used to define the standard of care if the legislation obliged physicians to adhere to relevant guidelines. In

that case, the legislation would serve as a sword for patients. Creating a liability shield for physicians, however, could be more difficult. This would require the creation of an irrebuttable presumption of non-negligence for physicians who adhered to the guidelines. Such an approach could be deemed invalid by the courts, however, if the liability protection afforded to physicians were seen as an improper denial of a remedy to injured parties or as an infringement on the jury’s role in determining the applicable standard of care. Safe harbor legislation that instead established a rebuttable presumption of non-negligence when providers followed approved guidelines might better withstand judicial scrutiny. But it might also provide less clear liability protection for physicians. Stakeholder Perspectives Most leaders of the six stakeholder groups agreed that increased physician adherence to guidelines could improve patient safety. However, not all of the leaders agreed that safe harbor legislation was the best way to increase adherence. Most leaders felt that implementing uniform, widely accepted guidelines would be a challenging, if not impossible, task. They noted that providers already encounter multiple guidelines from their specialty associations and hospitals. Stakeholders also expressed concerns about ensuring the timely updating of approved guidelines and making providers aware of the updates. Physicians voiced mixed feelings about the value of safe harbors. Primary care physicians generally supported the concept. Surgeons felt that decision making in the absence of clear scientific evidence is required so frequently of physicians—especially when treating patients with multiple chronic conditions—that safe harJ a n u a ry 201 4

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Malpractice Reform bor legislation would be largely ineffectual. Trial lawyers were concerned that safe harbor legislation operating only as a shield for physicians would limit a patient’s right to sue for injuries, without giving patients anything in return.

Discussion

14.7

◀ %

Of claims Guidelines appeared to apply to only 133 of the 907 claims we analyzed, or 14.7 percent.

64

Safe harbor legislation that provides liability protection to physicians when they follow approved evidence-based guidelines or standards has been proposed as a way to improve liability system performance, improve patient safety, and reduce health care costs. Our analysis of closed malpractice claims in Oregon found that safe harbor legislation might not substantially reduce the number of claims paid by physicians. We found that safe harbor legislation would have changed the outcome in favor of a physician defendant in only 3 of the 266 claims (1 percent) reviewed by physicians, or less than 1 percent of the entire set of 907 claims we evaluated. The likely explanation for these results is that in the absence of a safe harbor, adherence to guidelines appears to be already protecting physicians from paying claims without merit. In our study sample, only three of sixty-eight claims (4.4 percent) in which the physician had adhered to guidelines resulted in payment. Based on our results, the greatest potential of safe harbors appears to be in improving patient safety. In almost one-third of the cases (41 of 133) in which a guideline applied, the adverse outcome in the claim might have been avoided had a physician followed an applicable guideline. The safety benefits from safe harbors might be even greater than those estimated here, because better adherence to guidelines might also prevent a large number of injuries that do not result in claims.16,29,30 A reduction in patient injuries could in turn decrease liability compensation costs. For these benefits to be realized, however, safe harbors would need to induce providers to follow approved guidelines. How well this result would be achieved in practice remains an unanswered question that requires further study. Safe harbors might also reduce the number of non-negligent claims filed against physicians. We found that in 68 of the 133 claims filed (51 percent), physicians had adhered to the guidelines. However, in six of those sixty-eight claims (8.8 percent), adherence might have contributed to patient injury. By providing a priori protection to physicians who adhered to guidelines, even when adherence leads to injury, safe harbors might make these types of claims completely avoidable, reducing legal fears and the defensive practice of medicine as a result. The potential benefits of safe harbors notwith-

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A large number of guidelines would be required for safe harbor legislation to cover a reasonable number of claims.

standing, we uncovered a number of hurdles to their successful implementation. First, a broad range of stakeholders would need to support enactment of safe harbor legislation, and not all stakeholders have embraced the concept. We found that physicians had mixed views of safe harbors. If they were available only to physicians as a defense against liability, physicians would have little to lose with their implementation. But some physicians still raised concerns about how many clinical situations safe harbors would actually cover. In addition, patients and patient advocates may view safe harbor legislation that serves only as a shield for physicians to be inequitable.20 If the goal of safe harbors is to increase physicians’ adherence to evidence-based care, thereby improving patient safety, it might be reasonable to expand their use so that they serve as plaintiffs’ swords as well. This broader application could improve the accuracy of the legal system: At least 16 percent of the claims we reviewed went uncompensated, despite physicians’ deviation from the guidelines. However, it might also undermine the goal of reducing physicians’ liability fears. Second, safe harbor legislation would need to be drafted so that it both exerted an effect and could withstand judicial scrutiny. For example, when a safe harbor is available as a shield, does it create a rebuttable or an irrebuttable presumption of non-negligence? The former approach does not differ significantly from how guidelines can be used today: They can be introduced as evidence of the standard of care, but they are not dispositive.20 The latter approach more clearly establishes the standard for protection. However, it might be legally impermissible if deemed by a court to improperly eliminate a plaintiff’s remedy or interfere with a jury’s function. Third, there are a number of operational hurdles to administering safe harbor legislation. Approving and updating guidelines would re-

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Our analysis shows that safe harbors have the potential to improve the safety of care.

quire a sound governance structure and process. A state could choose to develop its own guidelines, or the task could be turned over to medical societies that have the appropriate expertise. If the latter approach is chosen, ensuring that patients feel that the development process is sufficiently free from bias and conflict of interest might require additional safeguards. The challenges of developing scientifically valid guidelines,31 including the existence of conflicting guidelines and the fast pace at which scientific evidence changes, will increase the administrative burden associated with this process. And no matter how rigorous the process, determining whether approved guidelines actually apply to a specific claim will likely remain a significant point of dispute and continue to hamper speedy claim resolution. Fourth, a large number of guidelines would be required for safe harbor legislation to cover a reasonable number of claims. Guidelines appeared to apply to only 133 of the 907 claims we analyzed (14.7 percent). This problem may become less serious as more guidelines are developed. Nonetheless, the administrative process associated with state endorsement might continue to constrain the number of guidelines that could be deployed and the amount of care that safe harbors could cover. Consequently, it is not clear whether the effort to implement and maintain a safe harbor system would generate a large enough return on investment. Further research on safe harbors is needed to determine their overall effects. Our analysis found that if safe harbors were available only Support for this work came from the Agency for Healthcare Research and Quality (Grant No. 1R21HS019535-01). The views expressed in this article do not necessarily reflect the position or policy of the Agency for Healthcare Research and Quality. Partners that

as a defense for physicians, they could reduce liability compensation costs by as much as 30 percent, with those savings being driven by injury prevention (Exhibit 1). However, it is unclear how well physicians would respond to this incentive. Thus, our analysis did not reveal how many injuries would actually be prevented or the legal and clinical cost savings that would be realized. It is possible that additional savings could result from the quicker resolution of claims: For example, attorney fees could be reduced, as could the emotional toll that protracted litigation has on patients and physicians. But such savings might not be realized if current disputes over whether the standard of care was met were replaced by disputes over whether safe harbor legislation applied. If plaintiffs could also use safe harbors as a sword, some of the compensation cost savings would be offset by increased payments for patients. However, these payments are desirable from the standpoint of equity and accuracy. Making safe harbors available to patients might further encourage physician guideline adherence. Finally, if safe harbors provided sufficient incentive for providers to follow guidelines calling for fewer tests and procedures, the result might be lower costs of care through a reduction in the practice of defensive medicine. Although our analysis suggests that guidelines already provide liability protection, safe harbors might nevertheless address physicians’ lingering perceptions of liability risk.

Conclusion Safe harbors might not reduce the number of non-negligent claims that physicians pay. However, our analysis shows that safe harbors have the potential to improve the safety of care. States considering the implementation of safe harbors need to address many legal and operational challenges. Continued experimentation and evaluation are also required to clarify whether safe harbors will be able to achieve their promise of improving patient safety and the performance of the liability system while reducing the costs of care. ▪

contributed to this study include the Oregon Health and Sciences University, the Oregon Patient Safety Commission, Providence Health and Services’ Center for Outcomes Research and Education, and the Oregon Department of Justice. This study was possible largely because

of the data provided by the Doctors Insurance Company and the Oregon Medical Board. The authors thank Carrie Parrish and Sydney Edlund for their efforts on this project.

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