Medical Malpractice

Medical Malpractice Insurance Crisis On The Rise In America

Presently, the battle at hand is the medical malpractice insurance crisis, which is totally different from the one we experienced in the late 1970s. There is too much happening in the midst of diminishing medical malpractice insurance services:

  • Insurance carriers are becoming bankrupt
  • Insurance premiums are soaring day by day
  • Cost of malpractice insurance becoming prohibitive to the extent of making physicians quit in some areas

Most disturbing are the effects to the patients. The ease of accessing health care is getting compromised by the drama.  

Malpractice Insurance

We are too quick to put the blame on plaintiff lawyers, insurance companies, and even runaway juries instead of examining our health care practices and being positive. This we find difficult, but there is a need to change our perception and feelings that make some of us go to the extent of suing our nurses, doctors, and hospitals.

What Are The Motivating Factors Behind The Malpractice? – Finding Answers

Malpractice Insurance

Why the Poor Ratings?

We are living in the age of sophisticated technological innovations, with the achievement of complicated treatments. Surprisingly, we, the patients don’t seem to appreciate any of these developments. We are so dissatisfied with our health care systems to the extent we go ahead and file lawsuits.

In a move to address this issue, several papers have been published. Different techniques have been used to tap into the mindset of victims (patients) by various authors trying to address these issue. According to three studies, the methods used were different as outlined below:

  • The first study used the deposition transcripts
  • The second study used telephone interviews.
  • The third study used questionnaires

According to the findings of the above studies, there were four major reasons as to why patients/plaintiffs were compelled to file lawsuits:

  • They were bitter and therefore had the desire to prevent the recurrence of past bad incidences
  • They needed thorough explanation on how and why errors were committed
  • They wanted compensation so as to make up for their financial losses, suffering, and pain. Alternatively, the compensation would help them take care of affected individuals
  • They wanted to hold every single doctor that messed accountable for their action.

What comes out based on the desires of patients is a breakdown of the patient-physician relationship. Lack of proper communication is evident here. According to the participants of the study, the following communication problems are clear:

  • Doctors deserted patients or were unavailable
  • Doctors devalued patient and family views
  • Doctors delivered information poorly
  • Doctors didn’t take time to understand the concerns of patients
  • Physicians were not willing to talk openly or even listen
  • Doctors didn’t warn patients of potential long-term neuro-developmental problems in the case of newborn injury

Early Detection And Proper Treatment

Staggering statistics shows that the healthcare system has failed regarding providing appropriate treatment and early detection. It is obvious that this will raise some questions. How comes the American healthcare system, which is one of the best in the world, is failing? Why are our competent doctors missing the mark?

So much focus has been placed on the downfalls of medical care in the United States even when several strategies have been put in place by clinicians, corporations, policymakers, public and you to improve it. In a nutshell, we all sided to the wrong perception. After all, America has the best medical care in the globe. What we can prove is the basis of this claim because statistics proves otherwise.

According to international data on infant mortality, life expectancy and quality of healthcare, the United States doesn’t appear at the top. Surprisingly, its place is in the lower quadrant among industrialized countries.

Shocking statistics indeed even when Americans pay more for health care services more than any other country on earth. Obviously, this raises the alarm. Why are Americans paying more and getting less in return?

Let’s take a look at the findings of recent studies. According to the breakdown, the following are clear:

  • Failure to have proper follow-up plan accounts for 45% (81 of 181 cases)
  • Failure to obtain adequate history accounts for 42% (76 of 181 cases)
  • Incorrect interpretation of test results accounts for 37% (67 of 181 cases)
  • Failure to carry out adequate and proper physical examination accounts for 42% (76 of 181 cases)
  • Failing to order for appropriate diagnostic test (59% of these errors resulted in serious harm while 30% caused death)

What is even more overwhelming are the top factors that contributed to these errors and failures. Let’s take a look at them too:

  • Vigilance or memory accounted for 59% (106 of181 cases)
  • Knowledge accounted for 48% (86 of 181 cases)
  • Failure in judgment accounted for 79% (143 of 181 cases)
  • Hand-offs accounted for 20% (36 of 181 cases)
  • Patient-related factors accounted for 46% (84 of 181 cases)

The Impact of Medical Malpractice Costs on Delivery of Health Care

Doctors Being Overworked

If healthcare providers won’t change their perspective and adopt the patient priority mentality, the costs of medical malpractice are expected to continue increasing. On an honest and fair view, our doctors prioritize the welfare of patients. The game is like when the dog chases its tail.

In a move to increase profitability in clinics, hospitals, and other facilities, few staff members are employed which in turn overworks the doctors, nurses and other practitioners. This implies that patients don’t get adequate time to interact with their doctors. This is very unfair given that it is the patient that incurs the daily increasing health insurance premiums.

For the sake of raising profits, patients suffer by receiving inadequate health care. It is a thorn in the flesh given that the insurance companies that pay more to settle malpractice lawsuit claims pass that cost to the patients who can hardly pay the malpractice insurance premiums which can go up to $275, 000 0per year.

Because of these issues, a considerable number if good physicians are opting for more lucrative jobs and quitting their practices.

The only effective way of correcting the current system is through combined efforts by the government, healthcare industry and other stakeholders adopting a different and more efficient model. We must monitor our health care system by being updated with the right information.

Use of Expensive Drugs and Costly New Technologies

It is evident that health care costs are disproportionately high but is this significant enough to be the largest reason behind the skyrocketing health care costs as explained by healthcare professionals and insurance companies?

Pharma Specialty Drug – Ranks 3rd

Whether used appropriately or inappropriately, the cost is still high in either case. A perfect example is a fibrinolysis or angioplasty used to treat MI. It is appropriate yet costly. Treating an MI was less expensive and also less effective before the 1980s when these treatments were so common.

Today, many new expensive treatment options are ineffective and are used inappropriately. They only offer a marginal advantage and may not be any good to the patient. For instance, lower lumbar spinal fusion is grossly used to treat chronic lower back pain, yet many experts believe it is ineffective.

There is a great variation in the usage of many costly treatments over a given geographical region and even among physicians in given locations.

Surprisingly, there is no difference in health outcomes in areas where spending is high in comparison to areas where health costs are considerably low. I guess you can learn something based on this and the previous case.

In a move to better health care practices, the government and the corporate world both subsidize the sector by removing economic disincentives. However, the problem is that similar systematic conditions apply in the entire area.

Higher Costs Of Health Care Goods And Services

The cost of drugs is skyrocketing. The reason attributed to the trend is the cost of developing a new drug whose vicinity is $1 billion. This simply implies that the incentive to invest in low-profit drugs is lowered because of the high drug development costs.

It is unfortunate that this happens even when such drugs could substantially benefit certain groups in the society. For example, this could be a big boost in drugs that treat rare illnesses or are used in general health care such as antibiotics and vaccines.

We can’t deny the fact that drug companies are failing us in many ways. This only leaves us with one option – The recent whistleblower. By this, I mean, the false claims act that will enable us to determine the true priorities of drug companies. Are they just interested in performing well in the stock market?

Health Care Goods And Services

Intensive Marketing of New Drugs and Devices

Another reason behind the overuse of costly technologies and drugs is the intensive marketing used. This is direct consumer advertising. Do not be surprised when the new measures turn out to be less effective compared to the older inexpensive ones.

Overuse Of Specialty Care

Specialists are getting busier day by day. This is probably caused by the substantial number of physicians leaving their practices for other carriers. Given that there is an unending desire by patients to see specialists, these practitioners are forced to offer more care.

It is more costly to seek specialist care compared to primary care. This is because of the high fees charged by specialists and the fact that they carry out more tests than primary physicians. On the other hand, treatment and evaluation of a patient that would otherwise have been done by one primary care physician will need the attention of more than one specialist practitioner.

High Administrative Costs

This is another cause for the increasing health care costs. About 20-30% of the health care budget goes to administrative costs.

Healthcare Sources Of Waste

Private insurance causes a greater percentage of the administrative costs. These costs result from underwriting and marketing process which, unfortunately, do not help improve the quality of medical care.

To curb this effect, the Affordable Care Act puts a limit on the maximum amount that private insurance can use on administrative costs. Also, having multiple private insurance plans in the same geographical area adds to the cost of health care. This is caused by the increased complexity of making processing claim submissions, which also takes time.

Private Insurance Plans

However, referralMD marketing and referral process can cut down on the many labor costs related to managing patient hand-offs. Plus, it will help maintain an accurate audit trail on both sides.

Physician Fees

Statistics shows that U.S. physicians are some of the most highly compensated professionals. In fact, they beat other professionals in the US and other countries by far.

Well, the reason for this disparity is the fact that other physicians spend far much less time on medical education and malpractice insurance compared to those of the U.S. Additionally, other physicians have lower office overheads.

However, reducing their compensation wouldn’t have much of an effect because their fees only account for 20% of the total costs of health care sector. A significant reduction would only result in a modest effect on the total health care costs.

Direct And Indirect Malpractice Costs

The issue of malpractice almost everything untouched. It also adds to the cost of medicine directly or indirectly. One way of affecting health care costs is by triggering defensive medicines. Well, perhaps you are wondering what the hell defensive medicine means?

Defensive medicines are clinically unwarranted treatments and diagnostic tests that are carried out to guard against any possibility of malpractice litigation. For instance, a doctor may intentionally decide to hospitalize a patient who would have otherwise done well with outpatient services so as to avoid being sued in case of any adverse outcome.

In this case, the direct costs are the malpractice premiums that are paid by health care institutions, physicians, medical drug and device manufacturers, and other providers. In the ultimate end, these premiums which are used to cover malpractice insurance company profits & overheads and claim settlements are paid by you. They get deducted from health care revenues.

Despite the difficult coupled with threats of lawsuits and premiums for individual physicians working in high-risk specialties and particular areas, the total annual malpractice premiums paid amounted to $55.6 billion. This is according to the 2013 US News and World Report.

The amount paid by physicians and institutions represented about 2.4% of annual spending in the health care sector. Those behind the research indicated that $45.6 billion represents defensive medicine costs.

Looking at the Diederich Healthcare 2017 Medical Malpractice Payout Analysis, the following is a breakdown of the actual malpractice settlements that were paid out in 2016.

  • Medical malpractice payouts due to death of the patient 31%
  • Malpractice payments resulting from surgery accounted for 24%
  • Payments resulting from misdiagnosis accounted for 34%