Archive for the ‘tort reform’ Category

Judicial Hellholes (About That Motherf*ckin’ Post…)

Judicial HellholesLast Friday I put up a story about a potential juror that, upon hearing the case dealt with a slip and fall, said to the plaintiff’s attorney during jury selection, “You motherfucker.”

I had three reasons for putting up that guest blog by “M.J.” First, it was funny.

Second, it showed how a talented attorney could make lemonade from lemons, as the few jurors left in the room after the majority made a run for the door were those most likely to listen fairly and objectively.

But the third reason was the most important. All too often we hear bleating from the bleachers — those who don’t actually try cases but fashion themselves pundits on the subject — about how easy it is to manipulate juries, or how the jury system is skewed in favor of plaintiffs due to the sympathy factor.

One outfit, the American Tort Reform Foundation, annually publishes a report on “judicial hellholes.” No, it isn’t an empirical study. They simply interview attorneys for corporations and ask them which places they wouldn’t want to be sued in.

But you wouldn’t know that by the way the press annually reports on the report as if it was a real study. Let’s face it, many members of the press are lazy and simply refashion press releases into articles.

You want a judicial hellhole? Then look at potential jurors who aren’t even interested in the facts, as they have already decided that the cause of the problem is not what caused the injury, but the lawyer that sought the justice.

The marketing folks learned a long time ago that propaganda often works. The job of the propaganda victims is to expose it and hopefully educate others. Thus, over at the PopTort, they once mockingly wrote of the report:

Your courageous “Judicial Hellholes” report at long last draws attention to the many injustices corporations have to face day in and day out. You have finally given a voice to the “mom and pop” tobacco companies, gasoline conglomerates, and insurance providers. Frankly, it gives me goose bumps. [much more at the link]

Sometimes we succeed in our education. Adam Liptak at the New York Times wrote about the judicial hellholes report that:

It is, for starters, a collection of anecdotes based largely on newspaper accounts. It has no apparent methodology. There is no way to tell why South Florida is the top hellhole while West Virginia is hellhole No. 4.

Since the tort “reformers” never stop, it’s worth noting that there are, in fact, judicial hellholes out there. Anyone that has ever stepped into the well of a courtroom and engaged in jury selection will have war stories to tell about it, albeit not quite as blunt and funny as the one “M.J.” shared with me last week.

 

The Fallacy of Loser Pays in Tort Litigation

OverlawyeredLast week at Overlawyered I had a little back and forth with its publisher, Walter Olson, on the concept of a loser-pays system. For those not familiar with the idea, this specifies that the loser of a lawsuit pays the legal fees of the winner. This is in contrast to the “American Rule” that says, generally, each side bears its own costs.

There are exceptions, of course, such as legal fees being part of a sanction for frivolous litigation, but we deal here today with the general rule.

There are two issues regarding the rule: The first is that it effectively closes the courthouse door to much of middle America. On one side in a typical tort case is likely to be a multi-billion dollar insurance company defending an auto collision or medical malpractice case, and on the other a person who may be struggling to work, or incapacitated and trying to figure out how to pay the mortgage or rent.

One side has incentive to run the meter and stall, and can readily afford to do so. If the litigant loses a simple issue of “who had the green light” then financial devastation may follow, but there is no such threat on the other side. The parties are not equal and the scales of justice unbalanced.

But the second issue is more interesting to me here because it deals with even broader public policy issues, and that came up with Olson’s comment responding to me:

A “legal system that only the wealthy can use” is not an accurate description of the pluses and minuses of the legal systems in the great majority of advanced democracies where loser-pays is the norm, such as Canada, the U.K., Scandinavia, the Netherlands, and so forth. It does, unfortunately, accurately describe some sectors of the American legal system (such as small high-merit claims and many injunctive matters) where neither fee shifts nor contingency fees are available. Oppose loser-pays if you like, but enough of the sloganeering.

The U.S. system here is compared to other nations with reputations for significant social service programs (and high taxes to pay for them). Universal health care is the most obvious example. The U.S., by contrast, has far less government involvement with our lives and some of the lowest taxes of any industrialized nation on earth.

If we close the court house door on people by making it more difficult to proceed, then what happens to those already injured? Well, they absorb the costs themselves until they are poor enough for the minimal social service programs that we have and then the taxpayer picks up the tab. And they remain poor, having now been victimized first by the negligence of others and then again by being forced to bear the financial burden.

The American Rule, as it now stands, is consistent with the parties working things out privately in court with minimal government intervention. Sure, verdicts can get tossed out if they are true outliers, but for the most part verdicts are respected.

The interesting part about this political discussion, I think, is that last week Overlawyered became affiliated with the Cato Institute, a libertarian think tank. While I certainly wouldn’t want to speak for them, it seems to me that a loser-pays system (and other tort “reform” measures that give protections and immunities to those who are negligent) garners greater government involvement in the lives of the populace, contrary to its own political philosophy.

If we want to shift the costs of injuries caused by negligence away from the tortfeasors and onto the backs of the taxpayers, then we need those Scandanavian government economies to accommodate that shift and provide the support.

The U.S., I think it’s clear, isn’t going that way.  We are faced with a choice as to whether we let parties duke things out privately or let the government come in with support. A nation can have one or the other. But what we can’t have, is both the stripping away of private rights at the same time that we have limited government support. That is not the model used by any industrialized nation that I know of.

Sen. Rob Portman, Gay Rights, and Tort “Reform”

RobPortmanLast week Ohio Senator Rob Portman made headlines when he reversed his stance on gay marriage. For a Republican, that was pretty big news. He did it after finding out his son was gay and reflecting on the meaning of love, marriage and religion.

But that isn’t why I’m writing.

I’m writing because, in his explanation, he went beyond the love/marriage/religion elements to reflect on the proper role of government in society. He wrote:

British Prime Minister David Cameron has said he supports allowing gay couples to marry because he is a conservative, not in spite of it. I feel the same way. We conservatives believe in personal liberty and minimal government interference in people’s lives.

So if he, as a conservative, believes in minimal government interference in people’s lives, why does he campaign on giving big government protections and immunities with various tort “reform” proposals that close the courthouse doors to those seeking justice?

One of the first things he did as a freshman senator in 2011 was introduce legislation that would impose a new statute of limitations on medical liability lawsuits and cap punitive and noneconomic damages.

His political view is summarized here:

Medical malpractice costs and the mounting costs of defensive medicine must be reduced through sensible legal reform and better health information.
Source: www.robportman.com/1on-the-issues (11/22/2010)

Really Senator? Is that what limited government is all about? Interceding on the rights of people seeking justice by protecting big business and insurance companies?

If someone would be kind enough to forward this to Portman, he might also learn that the artificial caps he supports because of “defensive medicine” have been proven by empirical evidence to be a complete bust. Health care costs in Texas, which instituted artificial one-size-fits-all caps in 2003 didn’t go down. Costs have actually gone up.

So Portman gets a special twofer: His tort “reform” policy contradicts his stance on federal power, and the basis of his policy is factually wrong.

If Portman wants to reign in federal power, as he states in part of his argument favoring gay rights, he may wish to revisit his other positions that call for increasing that power. Especially when increasing it fails to support  his theories.

More on the hypocrisy between conservatism and tort reform  here: Does the Tea Party Believe in Conservatism or Tort “Reform”? (8 Questions)

 

Tort “Reformers” Whine (Again) About Trial Lawyer Influence (#Hypocrisy)

In today’s New York Law Journal is another in a never-ending series of stock articles about big business whining about trial lawyer influence in the legislature.

This is the lede:

ALBANY – Bemoaning the clout of trial lawyers on New York government officials, a business-oriented group said yesterday that the lawyers spent nearly $20 million in the last six years to influence public policy.

The Lawsuit Reform Alliance of New York reported that personal injury law firms and individual lawyers made $8.2 million in campaign contributions while the lawyers’ political action committees chipped in another $6.5 million between Jan. 1, 2006, and Nov. 26, 2012. Additionally, the lawyers’ groups spent $6.3 million on lobbying.

Really? How pathetic.

Shall we now tally up the amount spent by massive health care conglomerates? Insurance companies? Real estate and construction companies?

The answer, of course, is yes!

But I don’t have to really write a post about that, because I already did it earlier in March of this year:  Trial Lawyer Lobbying in Albany (A lot or a little?)

It would be nice if the press, when faced with these silly press releases from big business, that parade as news, would actually try to do a little apples-to-apples comparison of political contributions. Because if they did so, they would see that the forces of the big business and the Fortune 500 swamp those of consumer groups.

This is one of the two graphics I used in my piece from March. Note that the lead contributor, the comically named Committee to Save New York, is a consortium of real estate developers. And also note that this is only lobbying money, and does not include campaign contributions from companies or political action committees:

 

 

 

A Graph is Worth a Thousand Words

I’ve spilled a lot of pixels here over the last six years on the issue of tort “reform” and the claims from business and the medical profession that personal injury suits are killing them.  I’ve made arguments, I’ve cited studies, I’ve pointed out hypocrisy.

But sometimes, nothing beats a good old fashioned graph, like the one at right. That’s right, just five percent of civil cases filed in the U.S. are tort cases. Most are contract matters, basically Business v. Business.

And then there is this other graph, at the left, showing the decline in medical malpractice payments over the last 10 years. You would think, if you listened to the doctors lobby, that the graph should be running the other way. But it doesn’t.

You can read more about the Facts v. Fiction of America’s ‘Litigation Explosion” at this link. It’s something to think about the next time the Chamber of Commerce comes out with its pseudo-scientific survey of….wait for it….corporate lawyers on their feelings about litigation. Seriously.  Or maybe the American Tort Reform Association equally laughable “Judicial Hellholes” report that members of the media distribute as if it was news, even though it has “no apparent methodology.”

The RNC Tells A Whopper

I suppose I should be used to by now: A political party making statements that are demonstrably false. And yet it continues, perhaps because those that value the falsehood make political contributions in order to perpetuate it. If you tell a lie often enough, people will believe it.

And so we turn to the Republican National Committee’s political platform and we look up what they have to say about tort “reform.” And what do we find? Rehashed falsehoods disproved by empirical evidence.

Let’s leave aside, for the moment, that the very concept of giving Big Government  immunities and protections to those that injure others runs directly contrary to conservative political philosophy. Let’s deal with simple accuracy today, and turn directly to the Republican platform as it applies to tort “reform:”

Frivolous medical malpractice lawsuits have ballooned the cost of healthcare for the average American. Physicians are increasingly practicing defensive medicine because of the looming threat of malpractice liability. Moreover, some medical practitioners are avoiding patients with complex and high-risk medical problems because of the high costs of medical malpractice lawsuits. Rural America is hurt especially hard as obstetricians, surgeons, and other healthcare providers are moving to urban settings or retiring, causing a significant healthcare workforce shortage and subsequently decreasing access to care for all patients. We are committed to aggressively pursuing tort reform legislation to help avoid the practice of defensive medicine, to keep healthcare costs low, and improve healthcare quality.

The platform deals primarily with three issues:

  1. Frivolous malpractice suits
  2. “defensive medicine”
  3. Lack of doctors in rural areas.
First, frivolous malpractice suits are losers. Because of the contingency system, those lawyers that bring them are destined for bankruptcy. They are marked “no pay” by the insurance carriers, vigorously defended by some of the best trial lawyers around, and any one foolish enough to bring them will find himself at the door of the bankruptcy court. Are there occasional frivolous suits? Of course. In a nation of 300 million people you will find frivolous business suits (biz brings 4x as many suits as individuals), Orly Taitz birther suits, defamation suits and all other kinds. But there is no data to confirm that the isolated cases are a major problem for society.

The issue is tough to study in the medical malpractice context by merely looking at medical records, since medical practitioners aren’t too keen on documenting their mistakes. Often, there is a simple question of fact for a jury: The patient says they made a complaint (lump in breast, floaters in the eye, etc.) and the doctor said not to worry.

But a study was done that showed most malpractice suits came from very few doctors. The study has been around since George Bush was president, yet it doesn’t seem to stop the perpetuation of the hoax of a malpractice crisis.

Next up, the concept of “defensive medicine.” That was disproved in a recent study in Texas, in which costs went up faster than the national average, despite brutal “reform” that closes the courthouse door to so many.

Which brings us to the last claim, that of a lack of doctors in rural areas. Well, it seems that doctors (and many others) don’t like to live in rural areas and want to live in the big cities and suburbs. But that isn’t because of malpractice cases. This too, was disproved by the Texas 2003 experiment in “reform, as more doctors did not come to Texas on a per capita basis in response.

When Mitt Romney speaks tonight will he repeat the falsehoods? There are just two reasons he might do so:

  1. The healthcare and insurance businesses are some of the biggest in the nation, and they give tons of money to politicians;
  2. Bashing lawyers is fun for the general public, because when we set forth the evidence in response to false statements we sound, well, like lawyers.

Gordon Gekko, HCA and Lawsuits (Why are medical costs going up?)

Greed is good. So says Gordon Gekko in the movie Wall Street. But is it the greed of medical professionals, or fear of lawsuits and the practice of “defensive medicine” that drives up medical costs?

The other day I responded to Dr. Sanjay Gupta’s op-ed in the New York Times on the related subject of more medical mistakes occurring because of unnecessary medical testing. And in that piece, and the part that spurred me to write, he claimed that defensive medicine was at fault.

This, of course, was dead wrong and has been disproved with empirical evidence.

But in doing that piece, I postulated three reasons why medical costs go up. The first one was deeply cynical:

  1. Doctors get reimbursed for each test they do, so there is a financial interest in over-ordering tests;
  2. Doctors simply want to look under every rock in the search for what ails the patient;
  3. Doctors have heard so much about lawsuits, that they order extra tests to protect themselves (i.e. defensive medicine).

I gave docs the benefit of the doubt and, while mentioning the greed factor in #1, then went on to ignore it and said many were simply conflating the concepts of fear for the patient with fear of the patient.

Now in the New York Times two days ago comes a long story on healthcare giant HCA, a for-profit owner of hospitals. And guess what? I shouldn’t really have ignored #1. Because this publicly traded, and profit-minded company is doing everything possible to increase profits. And that means increasing billing. Another way of saying increasing medical costs. From the article:

Among the secrets to HCA’s success: It figured out how to get more revenue from private insurance companies, patients and Medicare by billing much more aggressively for its services than ever before; it found ways to reduce emergency room overcrowding and expenses; and it experimented with new ways to reduce the cost of its medical staff, a move that sometimes led to conflicts with doctors and nurses over concerns about patient care.

In late 2008, for instance, HCA changed the billing codes it assigned to sick and injured patients who came into the emergency rooms. Almost overnight, the numbers of patients who HCA said needed more care, which would be paid for at significantly higher levels by Medicare, surged.

Now you shouldn’t mistake this post has a wholesale critique of capitalism. But the fact is, many people (and companies) want to maximize their income and earnings. And that is reflected in increased medical costs as more tests are ordered and more ways are designed to bill “aggressively” to increase profits.

From Gordon Gekko:

I am not a destroyer of companies. I am a liberator of them! The point is, ladies and gentleman, that greed, for lack of a better word, is good. Greed is right, greed works. Greed clarifies, cuts through, and captures the essence of the evolutionary spirit. Greed, in all of its forms; greed for life, for money, for love, knowledge has marked the upward surge of mankind. And greed, you mark my words, will not only save Teldar Paper, but that other malfunctioning corporation called the USA. Thank you very much.

The cries from the right side of American politics have often been to blame lawyers for increased medical costs because of “defensive medicine” as they seek tort “reform” for their favored political contributors (even though such “reform” kills patients and is politically hypocritical) . Sorry, but that’s wrong  The blame lies within a system that is designed to maximize profits. Greed.

 

Sorry, Dr. Gross, But You’re Wrong (Florida Malpractice Proposal)

In an opinion piece today in the Tampa Tribune, Dr. Lee S. Gross, treasurer of a local county Medical Society and president of the Florida chapter of Docs4PatientCare, advocates replacing the current medical liability system with a type of worker compensation system.

Dr. Gross’s argument, in a nutshell, goes like this:

By eliminating the fear of being sued, the wedge between patients and physicians will be removed, allowing doctors to choose the best health care for their patients. Fewer unnecessary tests and procedures will result in decreased health care costs for individuals, employers and state and federal governments.

The problem with this argument? It’s already been debunked by studies. The biggest study I know of is Texas, which turned itself into a lab study by eviscerating patient rights in 2003 by capping pain and suffering awards at $250,000. Since medical malpractice cases are so difficult to bring and expensive to prosecute, this effectively gave a big helping of immunity to the medical community.

The Texas logic in doing this? That by closing the courthouse door more doctors would come to Texas, whose population was swelling.

And the Texas experiment has now been shown to be a failure. It gave protections and immunities but didn’t do what it was intended to do. I wrote about this two months ago (Study Says Texas Medical Malpractice Tort “Reform” Is A Bust (Is Congress Listening?)), and you can read that post if you want more, but this is the summary:

There is no evidence that the number of physicians per capita practicing in Texas is larger than it would have been without tort reform.

But that wasn’t the only failure of the Texas Malpractice Experiment. It also failed to control costs. Since Florida’s Dr. Gross thinks reform will cut costs in Florida by eliminating “defensive medicine” tests, it’s worth noting that a different study showed Texas medical costs rose 13% more than the national average after its “reforms” were put in place. The problem, it seems, is that doctors get paid to do those so-called defensive tests.

While it is certainly possible that some docs at some points may practice defensive medicine, the real problem is that costs go up when you have a fee for service system.

And so, if you think that destroying the medical liability system in Florida is likely to lead to lower costs, there is an uphill fight because the data says otherwise. Will doctors make more money? Yes, they will. That happens when income stays the same and expenses (malpractice insurance) goes down. But it won’t help those injured by malpractice who will bear the burden of the injuries and it won’t help lower medical costs. What it really means, is that those injured will have to fight in an administrative forum for compensation, instead of a judicial forum, and do so for compensation that does not make them whole.

And last, a final note of irony: Dr. Gross, as I noted at the top, is part of an advocacy group called Docs4PatientCare. They oppose big government intervention in the healthcare system. Except, I guess, when the big government intervention is to help give them immunities and protections and increase their profits. Then, it seems, it is A-OK.

Study Says Texas Medical Malpractice Tort “Reform” Is A Bust (Is Congress Listening?)

I’ve written before about the savage Texas medical malpractice “reform” that was implemented in 2003 and its inherent injustice. The premise was that if the state capped pain and suffering awards at $250,000 for doctors (no matter how many were liable) and $250,000 for hospitals, it would encourage more doctors to practice medicine in Texas. The cap was nominal, meaning it was not adjusted for inflation, so it remains at that stagnated level.

Now there is a study that debunks the premise of that so-called reform. And even tort “reformer” Ted Frank agrees that the report is so damning that he will no longer cite Texas for the proposition that such reforms will lead to an increase in doctors in the state.

The report is exceptionally damning to those who argued that providing protections and immunities to negligent doctors would bring more doctors to Texas (though I’ve often wondered what kind of doctors they were looking to bring in with that logic). The summary:

Before Texas adopted tort reform in 2003, proponents claimed that physicians were deserting Texas in droves. After tort reform was enacted, proponents claimed there had been a dramatic increase in physicians moving to Texas due to the improved liability climate. We find no evidence to support either claim.

That is a big, fat ouch for those that have supported government protections for tortfeasors.

The $250,000 cap that was enacted back in 2003 did have some affect, of course. It cut down medical malpractice payments by 70% and premiums by 50%. But this wasn’t the reason for the changes in the law, since claim payouts had been stable for the preceding decade. But claims will clearly drop under such circumstances as cases are difficult and expensive to bring, and if it isn’t a economically viable to bring the suits, lawyers won’t take them. It isn’t easy to risk tens of thousands of dollars of your own money and hundreds of hours over many years if the case isn’t substantial enough. The rent still has to get paid, as does the secretary, and the lights need to be kept on.

But did the 70% drop in payouts bring the flood of doctors? You would think so according to the initial reports (including from the New York Times) that looked at the increase in licenses being issued. According to the report:

Proponents argued that physicians were fleeing Texas because of lawsuit risk and high insurance premiums, but would stop leaving if the state adopted the reforms. After the reforms took effect proponents asserted that the reforms brought new physicians to the state in droves – a more impressive result than they originally predicted, which was only that doctors already in Texas would stay put.

But using data from 2003 up until 2010, the authors conclude:

There is no evidence that the number of physicians per capita practicing in Texas is larger than it would have been without tort reform.

The evidence has been brewing. In 2007, four years after reform, the Texas Observer ran a piece discussing the nonsense that was sold to voters by the insurance industry to get the bill passed, claiming that “doctors were fleeing Texas, leaving scores of counties with no obstetricians to deliver babies, no neurologists or orthopedic surgeons to tend to the ill.” This wasn’t true.

Also from the Observer, to get that bill passed Gov. Rick Perry and his minions from the Texas Medical Association argued in a flier mailed out in English and Spanish and posted in waiting rooms around the state that:

‘152 counties in Texas now have no obstetrician. Wide swaths of Texas have no neurosurgeon or orthopedic surgeon. … The primary culprit for this crisis is an explosion in awards for non-economic (pain and suffering) damages in liability lawsuits.’

Doctors to deliver your babies or lawsuits, they argued, which would you like? And you know what? Four years after the “reforms” were passed there were still 152 rural counties without an obstetrician. Because it seems that doctors, like many other professionals, happen to like living in urban areas.

The reports of an increase in doctors attributable to tort “reform” that came out, and are often echoed in Congress by advocates of establishing federal standards over the state tort systems, have not been accurate. The authors attribute this to the fact that the number of doctors going to Texas was rising before 2003 (as was the population as a whole), that researchers at universities should not be counted as they are unaffected by the issue, and that there was an increase in medical care after Hurricane Katrina in 2005 as people relocated.

And finally, the statistics showing an increase in doctors was based on new licenses being issued. But that didn’t take into account those that left the state or had retired. You can’t just count docs entering Texas healthcare without also accounting for exiting docs if you want to figure out whether the net population is increasing or decreasing. According to the authors, “using the number of licenses granted as a measure of the “success” of tort reform is potentially very misleading.”

The fact that the physician population was increasing before the “reforms” and continued to increase at the same rate after the “reforms” is very telling. The authors write, “There was neither an exodus before reform, nor a dramatic increase after reform.” How damning is this report? The authors go on to write about those who made the claims for “reform”:

When making the case for lawsuit restrictions and when claiming enormous post-reform success, the identified speakers made statements that were false. And, not just garden variety false, but “liar, liar, pants on fire” false.

And that my friends, is a whole lot of false.

The report is filled with facts and figures that shows that in the post-reform era, Texas has actually done worse at attracting doctors then the rest of the nation. Not better. And not even the same.

I end on this note: As I type, Republicans in Congress (it is always those that claim they want limited government that do this) seek to expand federal power and put nationwide damage caps in place. One of the prime reasons is that were used in Texas. And those that were used in Texas have now been debunked.

(P.S.   For those that want to shift the argument to arguing that such reforms will lower health care costs, well, it doesn’t do that either. I covered that last year here:  The Failure of Medical Malpractice Caps (Healthcare Costs Rise in Texas).

Elsewhere:

New Study Crushes Key Claim in Federal Medmal Debate (Andrew Cochran)

Did You Know… Medical Malpractice Lawsuits Are Declining? (Brett Emison)

 

Trial Lawyer Lobbying in Albany (A lot or a little?)

It is often said —  but only by those who scream for tort “reform” — that the reason the laws on personal injury and personal accountability don’t change is because of all the money that trial lawyers pay to lobbyists and to political campaigns.

Well it seems that, when it comes to lobbying in Albany, we trial lawyers don’t even crack the top 10 according to this just-released report by the New York Joint Commission on Public Ethics (download report). But, look who does make the top 10:

 

And if you are wondering about the top dog, the Committee to Save New York, it is a business group of mostly real estate developers.

One day I’d love to see a study of how much the Fortune 500 companies donate to campaigns and compare that to donations by consumer activists.

Something to think about.

Oh yeah, we trial lawyers spent just 355K for lobbying according to the report:

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