MEDICINE,SCIENCE,AND SOCIETY
Medical Malpractice: A Nonadversarial Suggestion ELLIOT M. ABRAMSON,J.D., Chicago, I/~o;s, DAVIDS. DAVID, M.D., F.A.c.P., Los Angeles, California
BACKGROUND: The current legal system for prosecuting medical malpractice claims has bred widespread discontent. It has increased costs, jeopardized the delivery of necessary medical services, and corroded the physician-patient relationship with mistrust and poor morale. METHODS: Analysis of fairness of compensation awards and deterrence of substandard medical services under the current system. RESULTS: Compensation awards are inconsistent and unfairly contingent on irrational, adventitious factors. The current system does not seem to have had a significant effect on deterring poor medical practice or on improving medical practice in general. CONCLUSIONS: An alternative to the current litigation-oriented medical malpractice system should be established and centered around a four-member Medical Malpractice Tribunal composed of a general physician, an expert physician in the specialty area of the claim, an attorney, and a lay person. This tribunal would be empowered to investigate malpractice claims by gathering evidence and taking testimony from parties, experts, and witnesses. The tribunal could employ a table of treatment-related injuries in making fiidings as to physician liability and victim compensation. Such a system, through predictability, would likely increase malpractice prevention while decreasing legal costs and also costs associated with defensive medicine. Deterrence could be served by giving the tribunal power to recommend sanctions against substandard providers to appropriate licensing and disciplinary bodies and by requiring those found guilty of malpractice to contribute subsidies to a compensation fund. From the College of Law, DePaul University (EMA), Chicago, Illinois, and the Department of Medicine, University College of Los Angeles (DSD), Los Angeles, California. Requests for reprints should be addressed to Professor Elliott M. Abramson, College of Law, DePaul University, 25 East Jackson, Chicago, Illinois 60604. Manuscript submitted June 14. 1991, and accepted September 2, 1991.
T
he discontent with the current medical malpractice system is widespread. It has generated a cumulative effect of jeopardizing necessary medical services [ 1,2], increasing costs [3,4], and creating mistrust and poor morale on the part of physicians and patients [5]. But in order to correct a faulty system or replace it, one needs to know what the system was designed to accomplish and why the system in its current form is not achieving those goals. The current legal system, as applied to medical malpractice, has two goals. The first goal is to guarantee fair compensation to persons injured through the negligence of providers of medical care [6]. The second is to deter poor medical practice by imposing liability on parties who engage in negligent medical care [6].
COMPENSATIONUNDERTHE CURRENT SYSTEM With regard to fair compensation to persons injured, the current system is inconsistent and arbitrary. The jury awards are affected by the ability of the opposing lawyers, the nature of the injury, and the whim of the particular jury [7,8]. Juries seem to award more for injuries that are visible [9] and often base their verdicts on their own emotions or sympathy for the victim. So, quite often, similar injuries can be granted quite varying awards. Biographic factors have also been shown to contribute to inconsistent awards [lo]. The injured patients of medical malpractice are presumably no more deserving of compensation than the victims of automobile accidents, defective products, or work-related injuries. However, a recent Rand study of jury cases in Cook County, Illinois found that jury awards vary widely among victims with the same injury [ll]. The average victim of medical malpractice received five times the amount of an injury-on-property plaintiff and almost two times the amount of the victim injured at work or by a defective product [ll]. Victims of automobile accidents, work-related accidents, and others have the same “need” for compensation, yet the programs that pay for their
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disabilities do not compensate for pain and suffering [7]. Much more devastating than the well-publicized overcompensation, and at times undercompensation, are the many cases that are never litigated. Such unlitigated cases are much more common than are litigated cases [12]. Here injured victims get no compensation at all. The cost of malpractice litigation is high, so the lawyers who work on a contingency fee will only accept large claims in the hope of “hitting it big” [13]. Thus, injured patients with relatively small claims are entirely uncompensated for their injuries [13]. For example, such an event may occasion only several extra days of hospitalization and disability, as well as the expenses of medication and a few extra visits to the physician’s office. Yet, for many wage earners or elderly individuals living on fixed incomes, these incidents present significant costs. However, the claim is so modest in absolute financial terms, that it is almost surely not worthwhile for an attorney to prosecute such a claim from an economic point of view. So, certainly from the standpoint of achieving its objective of guaranteeing fair compensation to persons injured through negligence of providers of medical care, the current system is too much akin to the spin of a wheel of fortune [14].
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wealthy, or famous patient is much more likely to have a malpractice suit filed against him or her than is a physician who delivers consistent substandard care that causes frequent injuries to the poor, the elderly, or the unemployed patient. Also, a fair number of malpractice suits are not due to active negligence and substandard care but rather to an accepted complication of the risk of treatment of the underlying disease. However, health care providers and their insurance carriers often do not resist small, nuisance-type claims because they find it less expensive to pay for the claim than to litigate it [16]. So it is quite obvious that the current malpractice system has no significant effect on deterring poor medical practice. It not only misses litigating most cases of malpractice, but even those litigated are not always representative of a given physician’s negligence.
NO-FAULTMEDICAL MALPRACTICEINSURANCE No-fault mechanisms for injuries have developed in other areas where tort systems have failed to adequately compensate injured plaintiffs and where the costs of the system have become so burdensome as to outweigh its benefits. This has occurred in the areas of Workers’ Compensation and automobile insurance and under the National Childhood Vaccine Injury Act of 1986. In those areas in which no-fault approaches have applied, their reduced costs have improved the speed and reliability of compensation [14]. Because most cases of injury are truly accidental with neither malice nor gross negligence on the part of the physician, the most equitable nonadversarial system would function most efficiently by using a malpractice tribunal.
How about the ability of the current system to deter poor medical practice by imposing liability on parties who engage in negligent medical care [6]? There is nothing to suggest that the current malpractice system has led to improved medical practice [15]. Physicians, even excellent physicians, being human, continue to make an expected number of errors that at times cause injury. The negligent physicians are either oblivious to their suboptimal care or really are unconcerned as long as the insurance company pays the tab and they are allowed to continue to practice. Defensive medicine, which the current malpractice system has engendered, is not only costly [3], but it is bad medicine. Every time one increases the patient’s exposure to the health care system, including unnecessary testing, one increases the chances of injury through adverse reactions to testing procedures and human errors. Also, as discussed above, with the haphazardness and inequities of the current malpractice system, most negligent practice and substandard care goes unlitigated, and frequently, unreported and unnoticed. For instance, an excellent physician making an error that causes an injury to a sophisticated,
The tribunal would be composed of four members, including one general physician, one expert physician in the area of specialty presented by the claim, one attorney, and one lay person. The malpractice tribunal would be empowered to investigate claims of medical malpractice by gathering evidence and obtaining testimony from the parties, third persons, and experts. The tribunal would then make a judgment as to physician liability and determine compensation for the victim. Because the objective of the tribunal is to replace the tort system for cases involving medical malpractice, its authority should be limited to compensating claimants whose injuries actually stem from substandard medical practice.
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However, it should be noted that there are situations in which treatment is not substandard, but nevertheless, results in a new injury. For instance, suppose that during the insertion of a femoral catheter, a retroperitoneal hemorrhage occurs. Theoretically, this type of incident should not be within the authority of the tribunal because it does not involve malpractice as such. Nevertheless, a policy choice might be made to allow the tribunal to compensate such losses, while still excluding from its compass losses deriving from mere unsuccessful treatment. Because there are a myriad of forms of medical malpractice and because the finding of negligence is necessary, a table of treatment-related injuries would have to be developed that identify those outcomes having a strong presumption of being the result of malpractice. Such a table would define the scope of the tribunal’s jurisdiction. The tribunal would refer to such lists in deciding whether or not to compensate the victim. Such lists would also improve the predictability of outcomes by setting forth in detail the outcomes that would give rise to compensation. This predictability should also contribute to reducing transaction costs because claims should be able to be processed much more quickly than under the current tort system. Actually, in 1980, the American Bar Association made a study into such a schematic table and outlined the Designated Compensable Event (DCE) System [17]. This approach offers a sound middle ground between compensating all those who are medically injured and the current tort system of determined negligence on a case-by-case basis. The DCE is attractive because it can be used as a flexible tool. Since it is sometimes difficult to distinguish whether the adverse event was triggered by malpractice or was just an unexpected, but natural, outcome of the disease and its treatment, the tribunal can go beyond the list using it as a guideline in order to determine the amount of the award. Even in cases in which there is no listing of adverse outcomes for a particular event, i.e., a patient with nonspecific symptoms that a physician misdiagnoses due to the rarity of the patient’s disease, the tribunal would have power to base the award on its collective experience. Even in cases in which someone is injured by an event that is not listed as compensable, the patient will have the opportunity to prove fault to the tribunal. Furthermore, such a DCE System would also likely increase malpractice prevention while decreasing costs associated with defensive medicine. The list created under DCE would identify those outcomes that the medical community believes are
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preventable through standard medical care. Physicians would then concentrate their efforts on eschewing those outcomes without having to incur excessive expenses currently generated in practicing defensive medicine against all theoretically possible malpractice claims.
COMPENSATION Once the tribunal investigated and made a determination that the injury was caused by substandard care, it would then have the power to compensate victims for their losses. In general, the tribunal should limit compensation to only actual economic losses, i.e., medical expenses, rehabilitation, lost earnings, diminished capacity, etc. Such a limitation would reduce the size of the awards but would help to increase the consistency of the awards for similar injuries. However, exceptions could be made if associated pain and suffering are excessive, i.e., when a housewife is paralyzed due to malpractice and she is unable to perform many functions that she was able to do previously. In such a case, restitution of pure economic loss might be thought inadequate to compensate the victim, and the tribunal in awarding compensation could take into account pain and suffering. Although confining compensation to predominantly economic losses may sound unduly restrictive, such a system would result in appropriate compensation going to a greater number of deserving victims without increasing the overall cost to society. Punitive damages, meant to punish the physician and to deter future wrongdoers, would be eliminated. There are other less expensive and more effective ways of punishing inadequate physicians and deterring future wrongdoers (see below). Under this proposed system, more victims would be willing to file claims due to the reduced expense of doing so and the high probability that they will be compensated. Thus, this easy access could increase the volume of nuisance-type claims, which could tie up the tribunal and cause excessive delays in compensating deserving victims. One way of limiting the number of frivolous claims under the proposed system would be to exclude small claims, e.g., those under $5,000.00. In such cases, the loss might be left where it fell because it is relatively inconsequential. However, the inconsequentiality of the loss varies with the assets and resources of the injured party. Therefore, one might also cast a threshold limit for bringing a claim in terms of percentage of total assets or resources of the patient.
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Where would the funds for compensation come from? They could derive from a trust fund, much as under the Vaccine Act. The funding could be raised from general tax revenues, an excise tax on medical goods and services, insurance tax on physicians, and/or some combination of the above [IQ]. The statistical information arising from tribunal cases might be used to help formulate a tax rating system. For example, if the tribunal finds that a physician has committed malpractice, the physician would be required to contribute subsidies to the fund. Physicians who treat high-risk patients might be required to make additional contributions.
DETERRENCE The tribunal would also have the power to recommend sanctions against a health care provider to appropriate licensing and disciplinary agencies, in cases in which it concludes such action is appropriate. The tribunal would, of course, have to exercise this power seriously and forcefully to ensure achieving the necessary deterrent effect on negligent professional conduct. Another deterrent might be to require physicians who have been found by the tribunal to have committed malpractice to contribute subsidies to the compensation fund. The tribunal will also be in the position to objectively identify those physicians who exercise substandard care. In part, this might occur because of the additional claims that might well be brought due to the relative convenience and reduced expense of bringing claims. Thus, although physicians would not be personally liable for damages under the proposed scheme, the deterrent element could actually be greater than under the existing system. Physicians identified as habitual substandard providers would then be subject to peer review and discipline by such bodies as hospital boards or licensing panels [12]. In appropriate cases, the tribunal itself could recommend discipline to the relevant bodies. The information gathered by the tribunal could be used to make ratings of health care provided by physicians publicly available. This would improve the public’s overall knowledge of available medical care and provide greater opportunities to control the quality and cost of health care.
overall costs. Physicians would continue to practice defensive medicine and perform excessive testing on patients in fear of possible lawsuits, and they would still need some additional type of insurance to cover these contingencies. Since the compulsory tribunal system could alter the substantive rights and duties among health care providers and patients, it might be challenged as unconstitutional. For instance, because the nonadversarial tribunal system will only apply to adverse medical outcomes, the system may be challenged under the “Equal Protection Clause” on the grounds that it discriminates between persons injured in medical accidents and those injured in other kinds of accidents. Under the Equal Protection Clause, the Supreme Court has held that unless the classification affects a suspect class, such as race or national origin, only a rational basis test will be used [19,20]., The unequal treatment of classes of injured parties is clearly justifiable since rationality could be empirically demonstrated on the basis of the data used to compile the lists of compensable events [21]. The Fifth and 14th Amendments to the Constitution of the United States prohibit the government from depriving any person of “life, liberty, or property without due process of law.” A change from the current tort system to the proposed tribunal system should survive this due process attack because only a rational basis test is used unless the court finds a fundamental right involved. Under such a test, laws such as the Workers’ Compensation statutes have previously been upheld [22]. The Supreme Court, in evaluating a Washington, D.C., Workers’ Compensation statute, found no violation when the state replaced the tort system with the compulsory compensation scheme because the statute merely set aside one body of rules to establish another [22]. Accordingly, under such an approach, the court would likely find the tribunal system constitutional because the nonadversarial system is a reasonable substitute for the current tort system.
CONCLUSIONS
The decision of the tribunal should be final. If the patient were allowed to bring a traditional tort suit if she or he disagreed with the findings of the tribunal, then such a system would not rectify the deficiencies of the current system and would add to
The advantages of a nonadversarial malpractice tribunal over the existing tort system would be substantial. It would reduce economic costs of bringing the claim to malpractice by eliminating much of the adversarial character of the current system. It would also guarantee quicker compensation to injured patients. By removing medical malpractice from the realm of private insurance and direct provider liability, much of the burden of determining actual liability
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would be reduced. Without the fear of personal financial impact, providers might be inclined to cooperate with the tribunal in many cases. This cooperation would also reduce the overall transaction costs of claims by speeding the process of determining liability. Conversely, plaintiffs would not be unduly encouraged to seek the “big jackpot” of extravagant awards since the awards would be more closely tailored to actual injuries sustained. Thus, the difficulty of determining actual loss would be reduced [9]. Diluting the fear of malpractice liability should result in improved trust between physicians and patients. The relationship would no longer be tainted by the suspicion that the physicians might not fully disclose medical risks in order to prevent such information from being used against them in court. Patients would also have more faith in physicians’ actions knowing that tests were not being performed unnecessarily as a hedge against future lawsuits [23,12]. This should result in substantial savings from the reduction of the practice of defensive medicine, which the current tort system seems to encourage. A nonadversarial malpractice tribunal such as that one proposed would succeed in the two areas in which tort has failed: in the fair and consistent compensation of persons injured through medical malpractice and in the deterrence of substandard medical practice. It would do so for less than the total cost of medical malpractice litigation today. It would also assist the medical profession by improving available information and heightening awareness. It should also discourage a litigation “lottery” while not inhibiting legitimate claims.
REFERENCES 1. Comment. The medical malpractice crisis: will no-fault cure the disease? The University of Hawaii Law Review 1987; 9: 241.
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2. Gordon RJ, McMullen G, Weiss BD, Nicholas AW. The effect of malpractice liability on the delivery of rural obstetrical care. The Journal of Rural Health 1987; 3: 7-13. 3. AMA. Professional 1.
liability in the 80s. 1984; Report No. 1. Cited in reference
4. Snider H. Medical malpractice. Am Fam Physician 1990; 41: 1389-93. 5. Moore H, O’Connell J. Foreclosing medical malpractice claims by prompt tender of economic loss. Louisiana Law Review 1984; 44: 1267. 6.0wen D. Deterrence and desert in tort: a comment. The California Law Review 1985; 73: 665. 7. Sugarman S. Doing away with tort law. The California Law Review 1985; 73: 555. 8. Keeton R. O’Connell J. Basic protection for the traffic victim 1965; 22-4, 29-30, 225. 9. O’Connell J. Anco “no-fault” contract in lieu of tort: preaccident settlement offers. The California Law Review 1985; 73: 898. 10. Danzon P. The frequency and severity of medical malpractice claims. The Journal of Law and Economics 1984; 27: 115. Quoted in reference No. 7. 11. Chin A, Peterson M. Deep pockets, empty pockets. In: Rand Corporation Institute For Civil Justice 1985; 54. Cited in: Schwarz M. editor. Medical malpractice tort reform, liability crisis: the physician’s viewpoint 1987; 18. 12. Tancredi L. Designing a no-fault alternative. Law and Contemporary Problems 1986; 49: 277. 13. O’Connell J. Expanding no-fault beyond auto insurance: some proposals. The Virginia Law Review 1973; 59: 749. 14. O’Connell J. Neo no-fault remedies for medical injuries: coordinated statutory and contractual alternative. Law and Contemporary Problems 1986; 49: 125. 15. Coyte PC, Dewees DN, Trebilcock MJ. Medical malpractice-the Canadian experience. N Engl J Med 1991; 324: 89-93. 16. Willard. Medical malpractice-tort reform, the medical malpractice crisis and the need for tort reform. 1987. 17. The Commission on Medical Professional Liability explored a number of Innovative alternatives including a plan to compensate patients for all medically caused injuries which occur in a hospital, a workers’ compensation type of mechanism providing scheduled benefits to patients injured as the result of negligence, and two proposals that would define specifically the circumstance under which compensation would be paid. The Commission concluded that the most promising alternative compensable outcomes according to established criteria. Designated Compensable Event System: A Feasibility Study, American Bar Association, 1979. 18. SchwartzV, Mahshigian L. National Childhood Vaccine Injury Act of 1986: an add hoc remedy of a window for the future? The Ohio State Law Review 1987; 48: 387. 19. Massachusetts Board of Retirement v. Murgia. 427 U.S. 307 (1976). 20. Loving v. Virginia, 388 U.S. 1 (1967). 21. Michael M. v. Superior Court of Sonoma County, 450 U.S. 464 (1981). 22. Crowell v. Benson, 285 US. 22 (1922). 23. O’Connell J. Ending insult to injury: no-fault insurance for products and services. 1975; 29.
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Medical Malpractice: A Nonadversarial Suggestion ELLIOT M. ABRAMSON,J.D., Chicago, I/~o;s, DAVIDS. DAVID, M.D., F.A.c.P., Los Angeles, California
BACKGROUND: The current legal system for prosecuting medical malpractice claims has bred widespread discontent. It has increased costs, jeopardized the delivery of necessary medical services, and corroded the physician-patient relationship with mistrust and poor morale. METHODS: Analysis of fairness of compensation awards and deterrence of substandard medical services under the current system. RESULTS: Compensation awards are inconsistent and unfairly contingent on irrational, adventitious factors. The current system does not seem to have had a significant effect on deterring poor medical practice or on improving medical practice in general. CONCLUSIONS: An alternative to the current litigation-oriented medical malpractice system should be established and centered around a four-member Medical Malpractice Tribunal composed of a general physician, an expert physician in the specialty area of the claim, an attorney, and a lay person. This tribunal would be empowered to investigate malpractice claims by gathering evidence and taking testimony from parties, experts, and witnesses. The tribunal could employ a table of treatment-related injuries in making fiidings as to physician liability and victim compensation. Such a system, through predictability, would likely increase malpractice prevention while decreasing legal costs and also costs associated with defensive medicine. Deterrence could be served by giving the tribunal power to recommend sanctions against substandard providers to appropriate licensing and disciplinary bodies and by requiring those found guilty of malpractice to contribute subsidies to a compensation fund. From the College of Law, DePaul University (EMA), Chicago, Illinois, and the Department of Medicine, University College of Los Angeles (DSD), Los Angeles, California. Requests for reprints should be addressed to Professor Elliott M. Abramson, College of Law, DePaul University, 25 East Jackson, Chicago, Illinois 60604. Manuscript submitted June 14. 1991, and accepted September 2, 1991.
T
he discontent with the current medical malpractice system is widespread. It has generated a cumulative effect of jeopardizing necessary medical services [ 1,2], increasing costs [3,4], and creating mistrust and poor morale on the part of physicians and patients [5]. But in order to correct a faulty system or replace it, one needs to know what the system was designed to accomplish and why the system in its current form is not achieving those goals. The current legal system, as applied to medical malpractice, has two goals. The first goal is to guarantee fair compensation to persons injured through the negligence of providers of medical care [6]. The second is to deter poor medical practice by imposing liability on parties who engage in negligent medical care [6].
COMPENSATIONUNDERTHE CURRENT SYSTEM With regard to fair compensation to persons injured, the current system is inconsistent and arbitrary. The jury awards are affected by the ability of the opposing lawyers, the nature of the injury, and the whim of the particular jury [7,8]. Juries seem to award more for injuries that are visible [9] and often base their verdicts on their own emotions or sympathy for the victim. So, quite often, similar injuries can be granted quite varying awards. Biographic factors have also been shown to contribute to inconsistent awards [lo]. The injured patients of medical malpractice are presumably no more deserving of compensation than the victims of automobile accidents, defective products, or work-related injuries. However, a recent Rand study of jury cases in Cook County, Illinois found that jury awards vary widely among victims with the same injury [ll]. The average victim of medical malpractice received five times the amount of an injury-on-property plaintiff and almost two times the amount of the victim injured at work or by a defective product [ll]. Victims of automobile accidents, work-related accidents, and others have the same “need” for compensation, yet the programs that pay for their
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disabilities do not compensate for pain and suffering [7]. Much more devastating than the well-publicized overcompensation, and at times undercompensation, are the many cases that are never litigated. Such unlitigated cases are much more common than are litigated cases [12]. Here injured victims get no compensation at all. The cost of malpractice litigation is high, so the lawyers who work on a contingency fee will only accept large claims in the hope of “hitting it big” [13]. Thus, injured patients with relatively small claims are entirely uncompensated for their injuries [13]. For example, such an event may occasion only several extra days of hospitalization and disability, as well as the expenses of medication and a few extra visits to the physician’s office. Yet, for many wage earners or elderly individuals living on fixed incomes, these incidents present significant costs. However, the claim is so modest in absolute financial terms, that it is almost surely not worthwhile for an attorney to prosecute such a claim from an economic point of view. So, certainly from the standpoint of achieving its objective of guaranteeing fair compensation to persons injured through negligence of providers of medical care, the current system is too much akin to the spin of a wheel of fortune [14].
DETERRENCEOF POORMEDICALPRACTICE UNDERTHE CURRENTSYSTEM
wealthy, or famous patient is much more likely to have a malpractice suit filed against him or her than is a physician who delivers consistent substandard care that causes frequent injuries to the poor, the elderly, or the unemployed patient. Also, a fair number of malpractice suits are not due to active negligence and substandard care but rather to an accepted complication of the risk of treatment of the underlying disease. However, health care providers and their insurance carriers often do not resist small, nuisance-type claims because they find it less expensive to pay for the claim than to litigate it [16]. So it is quite obvious that the current malpractice system has no significant effect on deterring poor medical practice. It not only misses litigating most cases of malpractice, but even those litigated are not always representative of a given physician’s negligence.
NO-FAULTMEDICAL MALPRACTICEINSURANCE No-fault mechanisms for injuries have developed in other areas where tort systems have failed to adequately compensate injured plaintiffs and where the costs of the system have become so burdensome as to outweigh its benefits. This has occurred in the areas of Workers’ Compensation and automobile insurance and under the National Childhood Vaccine Injury Act of 1986. In those areas in which no-fault approaches have applied, their reduced costs have improved the speed and reliability of compensation [14]. Because most cases of injury are truly accidental with neither malice nor gross negligence on the part of the physician, the most equitable nonadversarial system would function most efficiently by using a malpractice tribunal.
How about the ability of the current system to deter poor medical practice by imposing liability on parties who engage in negligent medical care [6]? There is nothing to suggest that the current malpractice system has led to improved medical practice [15]. Physicians, even excellent physicians, being human, continue to make an expected number of errors that at times cause injury. The negligent physicians are either oblivious to their suboptimal care or really are unconcerned as long as the insurance company pays the tab and they are allowed to continue to practice. Defensive medicine, which the current malpractice system has engendered, is not only costly [3], but it is bad medicine. Every time one increases the patient’s exposure to the health care system, including unnecessary testing, one increases the chances of injury through adverse reactions to testing procedures and human errors. Also, as discussed above, with the haphazardness and inequities of the current malpractice system, most negligent practice and substandard care goes unlitigated, and frequently, unreported and unnoticed. For instance, an excellent physician making an error that causes an injury to a sophisticated,
The tribunal would be composed of four members, including one general physician, one expert physician in the area of specialty presented by the claim, one attorney, and one lay person. The malpractice tribunal would be empowered to investigate claims of medical malpractice by gathering evidence and obtaining testimony from the parties, third persons, and experts. The tribunal would then make a judgment as to physician liability and determine compensation for the victim. Because the objective of the tribunal is to replace the tort system for cases involving medical malpractice, its authority should be limited to compensating claimants whose injuries actually stem from substandard medical practice.
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However, it should be noted that there are situations in which treatment is not substandard, but nevertheless, results in a new injury. For instance, suppose that during the insertion of a femoral catheter, a retroperitoneal hemorrhage occurs. Theoretically, this type of incident should not be within the authority of the tribunal because it does not involve malpractice as such. Nevertheless, a policy choice might be made to allow the tribunal to compensate such losses, while still excluding from its compass losses deriving from mere unsuccessful treatment. Because there are a myriad of forms of medical malpractice and because the finding of negligence is necessary, a table of treatment-related injuries would have to be developed that identify those outcomes having a strong presumption of being the result of malpractice. Such a table would define the scope of the tribunal’s jurisdiction. The tribunal would refer to such lists in deciding whether or not to compensate the victim. Such lists would also improve the predictability of outcomes by setting forth in detail the outcomes that would give rise to compensation. This predictability should also contribute to reducing transaction costs because claims should be able to be processed much more quickly than under the current tort system. Actually, in 1980, the American Bar Association made a study into such a schematic table and outlined the Designated Compensable Event (DCE) System [17]. This approach offers a sound middle ground between compensating all those who are medically injured and the current tort system of determined negligence on a case-by-case basis. The DCE is attractive because it can be used as a flexible tool. Since it is sometimes difficult to distinguish whether the adverse event was triggered by malpractice or was just an unexpected, but natural, outcome of the disease and its treatment, the tribunal can go beyond the list using it as a guideline in order to determine the amount of the award. Even in cases in which there is no listing of adverse outcomes for a particular event, i.e., a patient with nonspecific symptoms that a physician misdiagnoses due to the rarity of the patient’s disease, the tribunal would have power to base the award on its collective experience. Even in cases in which someone is injured by an event that is not listed as compensable, the patient will have the opportunity to prove fault to the tribunal. Furthermore, such a DCE System would also likely increase malpractice prevention while decreasing costs associated with defensive medicine. The list created under DCE would identify those outcomes that the medical community believes are
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preventable through standard medical care. Physicians would then concentrate their efforts on eschewing those outcomes without having to incur excessive expenses currently generated in practicing defensive medicine against all theoretically possible malpractice claims.
COMPENSATION Once the tribunal investigated and made a determination that the injury was caused by substandard care, it would then have the power to compensate victims for their losses. In general, the tribunal should limit compensation to only actual economic losses, i.e., medical expenses, rehabilitation, lost earnings, diminished capacity, etc. Such a limitation would reduce the size of the awards but would help to increase the consistency of the awards for similar injuries. However, exceptions could be made if associated pain and suffering are excessive, i.e., when a housewife is paralyzed due to malpractice and she is unable to perform many functions that she was able to do previously. In such a case, restitution of pure economic loss might be thought inadequate to compensate the victim, and the tribunal in awarding compensation could take into account pain and suffering. Although confining compensation to predominantly economic losses may sound unduly restrictive, such a system would result in appropriate compensation going to a greater number of deserving victims without increasing the overall cost to society. Punitive damages, meant to punish the physician and to deter future wrongdoers, would be eliminated. There are other less expensive and more effective ways of punishing inadequate physicians and deterring future wrongdoers (see below). Under this proposed system, more victims would be willing to file claims due to the reduced expense of doing so and the high probability that they will be compensated. Thus, this easy access could increase the volume of nuisance-type claims, which could tie up the tribunal and cause excessive delays in compensating deserving victims. One way of limiting the number of frivolous claims under the proposed system would be to exclude small claims, e.g., those under $5,000.00. In such cases, the loss might be left where it fell because it is relatively inconsequential. However, the inconsequentiality of the loss varies with the assets and resources of the injured party. Therefore, one might also cast a threshold limit for bringing a claim in terms of percentage of total assets or resources of the patient.
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Where would the funds for compensation come from? They could derive from a trust fund, much as under the Vaccine Act. The funding could be raised from general tax revenues, an excise tax on medical goods and services, insurance tax on physicians, and/or some combination of the above [IQ]. The statistical information arising from tribunal cases might be used to help formulate a tax rating system. For example, if the tribunal finds that a physician has committed malpractice, the physician would be required to contribute subsidies to the fund. Physicians who treat high-risk patients might be required to make additional contributions.
DETERRENCE The tribunal would also have the power to recommend sanctions against a health care provider to appropriate licensing and disciplinary agencies, in cases in which it concludes such action is appropriate. The tribunal would, of course, have to exercise this power seriously and forcefully to ensure achieving the necessary deterrent effect on negligent professional conduct. Another deterrent might be to require physicians who have been found by the tribunal to have committed malpractice to contribute subsidies to the compensation fund. The tribunal will also be in the position to objectively identify those physicians who exercise substandard care. In part, this might occur because of the additional claims that might well be brought due to the relative convenience and reduced expense of bringing claims. Thus, although physicians would not be personally liable for damages under the proposed scheme, the deterrent element could actually be greater than under the existing system. Physicians identified as habitual substandard providers would then be subject to peer review and discipline by such bodies as hospital boards or licensing panels [12]. In appropriate cases, the tribunal itself could recommend discipline to the relevant bodies. The information gathered by the tribunal could be used to make ratings of health care provided by physicians publicly available. This would improve the public’s overall knowledge of available medical care and provide greater opportunities to control the quality and cost of health care.
overall costs. Physicians would continue to practice defensive medicine and perform excessive testing on patients in fear of possible lawsuits, and they would still need some additional type of insurance to cover these contingencies. Since the compulsory tribunal system could alter the substantive rights and duties among health care providers and patients, it might be challenged as unconstitutional. For instance, because the nonadversarial tribunal system will only apply to adverse medical outcomes, the system may be challenged under the “Equal Protection Clause” on the grounds that it discriminates between persons injured in medical accidents and those injured in other kinds of accidents. Under the Equal Protection Clause, the Supreme Court has held that unless the classification affects a suspect class, such as race or national origin, only a rational basis test will be used [19,20]., The unequal treatment of classes of injured parties is clearly justifiable since rationality could be empirically demonstrated on the basis of the data used to compile the lists of compensable events [21]. The Fifth and 14th Amendments to the Constitution of the United States prohibit the government from depriving any person of “life, liberty, or property without due process of law.” A change from the current tort system to the proposed tribunal system should survive this due process attack because only a rational basis test is used unless the court finds a fundamental right involved. Under such a test, laws such as the Workers’ Compensation statutes have previously been upheld [22]. The Supreme Court, in evaluating a Washington, D.C., Workers’ Compensation statute, found no violation when the state replaced the tort system with the compulsory compensation scheme because the statute merely set aside one body of rules to establish another [22]. Accordingly, under such an approach, the court would likely find the tribunal system constitutional because the nonadversarial system is a reasonable substitute for the current tort system.
CONCLUSIONS
The decision of the tribunal should be final. If the patient were allowed to bring a traditional tort suit if she or he disagreed with the findings of the tribunal, then such a system would not rectify the deficiencies of the current system and would add to
The advantages of a nonadversarial malpractice tribunal over the existing tort system would be substantial. It would reduce economic costs of bringing the claim to malpractice by eliminating much of the adversarial character of the current system. It would also guarantee quicker compensation to injured patients. By removing medical malpractice from the realm of private insurance and direct provider liability, much of the burden of determining actual liability
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would be reduced. Without the fear of personal financial impact, providers might be inclined to cooperate with the tribunal in many cases. This cooperation would also reduce the overall transaction costs of claims by speeding the process of determining liability. Conversely, plaintiffs would not be unduly encouraged to seek the “big jackpot” of extravagant awards since the awards would be more closely tailored to actual injuries sustained. Thus, the difficulty of determining actual loss would be reduced [9]. Diluting the fear of malpractice liability should result in improved trust between physicians and patients. The relationship would no longer be tainted by the suspicion that the physicians might not fully disclose medical risks in order to prevent such information from being used against them in court. Patients would also have more faith in physicians’ actions knowing that tests were not being performed unnecessarily as a hedge against future lawsuits [23,12]. This should result in substantial savings from the reduction of the practice of defensive medicine, which the current tort system seems to encourage. A nonadversarial malpractice tribunal such as that one proposed would succeed in the two areas in which tort has failed: in the fair and consistent compensation of persons injured through medical malpractice and in the deterrence of substandard medical practice. It would do so for less than the total cost of medical malpractice litigation today. It would also assist the medical profession by improving available information and heightening awareness. It should also discourage a litigation “lottery” while not inhibiting legitimate claims.
REFERENCES 1. Comment. The medical malpractice crisis: will no-fault cure the disease? The University of Hawaii Law Review 1987; 9: 241.
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2. Gordon RJ, McMullen G, Weiss BD, Nicholas AW. The effect of malpractice liability on the delivery of rural obstetrical care. The Journal of Rural Health 1987; 3: 7-13. 3. AMA. Professional 1.
liability in the 80s. 1984; Report No. 1. Cited in reference
4. Snider H. Medical malpractice. Am Fam Physician 1990; 41: 1389-93. 5. Moore H, O’Connell J. Foreclosing medical malpractice claims by prompt tender of economic loss. Louisiana Law Review 1984; 44: 1267. 6.0wen D. Deterrence and desert in tort: a comment. The California Law Review 1985; 73: 665. 7. Sugarman S. Doing away with tort law. The California Law Review 1985; 73: 555. 8. Keeton R. O’Connell J. Basic protection for the traffic victim 1965; 22-4, 29-30, 225. 9. O’Connell J. Anco “no-fault” contract in lieu of tort: preaccident settlement offers. The California Law Review 1985; 73: 898. 10. Danzon P. The frequency and severity of medical malpractice claims. The Journal of Law and Economics 1984; 27: 115. Quoted in reference No. 7. 11. Chin A, Peterson M. Deep pockets, empty pockets. In: Rand Corporation Institute For Civil Justice 1985; 54. Cited in: Schwarz M. editor. Medical malpractice tort reform, liability crisis: the physician’s viewpoint 1987; 18. 12. Tancredi L. Designing a no-fault alternative. Law and Contemporary Problems 1986; 49: 277. 13. O’Connell J. Expanding no-fault beyond auto insurance: some proposals. The Virginia Law Review 1973; 59: 749. 14. O’Connell J. Neo no-fault remedies for medical injuries: coordinated statutory and contractual alternative. Law and Contemporary Problems 1986; 49: 125. 15. Coyte PC, Dewees DN, Trebilcock MJ. Medical malpractice-the Canadian experience. N Engl J Med 1991; 324: 89-93. 16. Willard. Medical malpractice-tort reform, the medical malpractice crisis and the need for tort reform. 1987. 17. The Commission on Medical Professional Liability explored a number of Innovative alternatives including a plan to compensate patients for all medically caused injuries which occur in a hospital, a workers’ compensation type of mechanism providing scheduled benefits to patients injured as the result of negligence, and two proposals that would define specifically the circumstance under which compensation would be paid. The Commission concluded that the most promising alternative compensable outcomes according to established criteria. Designated Compensable Event System: A Feasibility Study, American Bar Association, 1979. 18. SchwartzV, Mahshigian L. National Childhood Vaccine Injury Act of 1986: an add hoc remedy of a window for the future? The Ohio State Law Review 1987; 48: 387. 19. Massachusetts Board of Retirement v. Murgia. 427 U.S. 307 (1976). 20. Loving v. Virginia, 388 U.S. 1 (1967). 21. Michael M. v. Superior Court of Sonoma County, 450 U.S. 464 (1981). 22. Crowell v. Benson, 285 US. 22 (1922). 23. O’Connell J. Ending insult to injury: no-fault insurance for products and services. 1975; 29.
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