“Neon Insurance Office Sign” by David Hilowitz is licensed under CC BY 2.0
Medical malpractice suits can result in judgments ranging in the millions of dollars. As such, most practitioners have some type of medical malpractice insurance to cover them in the event they are sued. If you’ve recently been the victim of medical malpractice, you may be wondering how this insurance works, so here are some of the facts and myths surrounding it to help you become better informed.
What is Medical Malpractice Insurance?
Also known as medical liability insurance, it covers healthcare providers who make errors in treating patients, or are negligent in providing them care. It generally covers the cost of litigation in addition to providing damages to victims. A few of the things it covers includes (but is not limited to):
- Misdiagnosis
- Administering the wrong medication
- Failure to read test results properly
- Delays in treatment that cause a worsening of symptoms
- Surgical errors
- Wrongful death
Not just for Doctors
While medical malpractice insurance is typically thought of as being something for doctors, it is actually used by others in the healthcare industry as well. Physicians are not the only ones who can be targeted in a medical malpractice lawsuit, which is why nurses, lab technicians, physician’s assistants and medical technicians sometimes carry coverage as well. While these workers were once considered extensions of the doctors they worked for, they are now thought of as being independently licensed professionals, and can therefore be held liable for medical errors.
Although other healthcare workers may carry medical malpractice insurance, they usually have less coverage, since their potential liability is actually much smaller than a physician’s is. Institutions also have their own coverage, which may or may not cover individual employees. Many healthcare workers believe they are automatically covered under their employer’s plan, and are shocked to discover they have little or no representation from an insurance company once a malpractice claim has been filed.
Deciding who to Sue
A decision as to which healthcare professionals are named in a lawsuit is not done based upon who has medical malpractice insurance and who doesn’t. Instead, attorneys look at the facts of each individual case in order to determine who may have been liable for an incident. All of these people are then included in a subsequent complaint, since litigants have only one chance to present their case in court. This means it would not be possible to bring a separate lawsuit arising from the same facts later.
Information about medical malpractice coverage does not come until the discovery phase of litigation. This is when parties from both sides exchange information so that there are no surprises at trial. Even if it is discovered that one or more individuals is not insured, he or she will still be named as a defendant, and could therefore still be liable. These individuals could be required to pay damages out of their own pockets, and could be subject to wage garnishments or having property seized if they are unable to do so.
Medical Malpractice Insurance and Frivolous Lawsuits
There is some concern about the effects of frivolous lawsuits on our court systems, particularly when it comes to medical malpractice. As a result, some people believe that others are being encouraged to file frivolous lawsuits, simply because they think all medical practitioners are insured. The truth is that medical malpractice cases make up only around six percent of all tort claims, according to information from the National Center for State Courts. In addition, advocates for patient safety believe that very few people who are injured due to medical negligence actually sue. Harvard researchers have estimated that only one in eight people who are victims of medical negligence will subsequently file a lawsuit.
Those who do file medical malpractice suits are likely to have suffered serious injury or the death of a loved one. Harvard researchers also found that 80 percent of all medical lawsuits fell into one of those two categories, and that 97 percent of all claims in general were meritorious in nature. This means there is little to support the idea that having medical malpractice insurance opens a provider up to the possibility of a frivolous lawsuit.
Effect on Health Care Costs
There is a common misconception that rising health care costs are largely due to the high price of medical malpractice insurance, which health care providers ultimately pass on to their patients. According to a report from the American Association for Justice on Medical Negligence, the total amount spent defending claims of medical negligence in 2007 amounted to just 0.3% of health care costs. The AAJ does not recommend setting caps on damages, since the amount of money this would save the public is only negligible at best.
Another argument claims that the threat of medical malpractice suits causes doctors to practice “defensive medicine”, which involves them ordering unnecessary tests in order to avoid a potential lawsuit. The American Association for Justice also claims this has little bearing on the overall cost of health care. Instead, they claim that a good number of unnecessary tests are ordered in order to generate more income rather than out of a fear of being sued.
Costs Causes Doctors to Flee
Another common myth about medical malpractice insurance is that its high cost is causing a good number of doctors to leave the profession, leaving people in many areas with a shortage of health care providers. The American Association for Justice on Medical Negligence also debunks this myth. They claim there are now twice as many doctors per 100,000 people as there was in the 1960s when the American Medical Association first began tracking this data.
In addition, capping the amount of damages does not seem to have a bearing on whether or not physicians leave the practice. In fact, the number of doctors per 100,000 population tends to be higher in states that do not have caps on damages than in states that do have caps.
Tort Reform is needed to Lower Premiums
Tort reform has been touted as a successful measure when it comes to reducing medical malpractice insurance premiums. This has not proven to be beneficial in the past as:
- Medical professionals in states with caps on damages pay roughly the same amount for premiums as others in states with caps do
- GE Medical Protective, a leading provider of medical malpractice insurance informed the Texas Insurance Commissioner that caps in that state had very little impact on rates.
- Tort reform is estimated to save a mere 1.0 percent in insurance costs each year
- Major insurance companies have claimed that their rates would not necessarily decrease if tort reform was passed
Tort reform would actually hurt you as a patient if you are injured at the hands of a practitioner. This is because it would limit the amount of damages you would receive. This could be detrimental if you have debilitating injuries, since the amount awarded might not be enough to cover subsequent medical care or pain and suffering. Instead, the amount of damages should be determined by a jury, who can review the entire set of circumstances and ensure victims are fairly compensated.
Advice for Victims
Providers of medical malpractice insurance tend to fight aggressively to keep from paying claims. In some cases, they will even spend more money litigating a case than they would settling it, simply so that others will not be encouraged to file similar suits. Fighting a medical malpractice insurer can result in a long and difficult battle, which is why you need an aggressive attorney of your own. Doing so can make the difference between living in pain and agony or obtaining the compensation you deserve.
