Don’t Swallow Hype on Malpractice Caps

At first glance, the May 15 editorial espousing caps on damages in medical malpractice cases might have knee-jerk logical appeal. But a closer look at the facts leads to the opposite conclusion.

First, the claim that there is a lawsuit crisis is unfounded because lawsuits against doctors are not on the rise in Illinois. The number of medical malpractice payouts fell by almost 4 percent in the last eight years. Medical malpractice payouts rose slower than medical inflation since 1990, and according to the American Medical Association, doctors’ malpractice premiums make up less than 4 percent of their total operation revenue.

Second, the largest insurer of doctors in this state, the Illinois Medical Insurance Exchange, whines that it needs to have a 35 percent premium increase because of a "lawsuit crisis." Insurance company executives claim they don’t have sufficient funds. But data from the sworn statement of ISMIE filed with the state shows that the number of paid claims is actually down more than 20 percent in the last four years, and the average paid claim has increased only slightly more than the rate of medical inflation.

Yet, to the public, the insurance groups and physicians claim that these figures are on the rise. It makes for misleading headlines and unsubstantiated editorials.

The truth is ISMIE took in almost 10 percent less in premiums last year, its net capital (investment)losses jumped over 700 percent last year, and its investment income plummeted 36 percent in the last four years. These figures parallel what is happening to everyone across the country because of the drop in the stock and bond markets.

Yet, according to its sworn statements, ISMIE has sufficient funds to carry over $1 million in loans to its own directors and officers on its 2002 books.

As doctors at the Daley Center Plaza rally shouted from the dais, Illinois already has lawsuit reform in place – from requiring a medical affidavit in order to file a case to prevent frivolous lawsuit to controlling lawyers’ fees. All that’s left is caps, according to the doctors.

But let’s face it. Caps already exist in Illinois. The limit of a physician’s insurance policy generally sets the ceiling on what a victim of malpractice can recover. No patient, no matter how badly hurt, is in a position to put a doctor out of business.

It boils down to insurance companies that don’t want to pay what doctors have contracted for to protect them when they make a mistake. A cap of $250,000 (or any other amount) would affect those hurt the worst by the negligence of medical professionals while protecting the very people who caused the harm.

The Coalition for Consumer Rights in Illinois released a report this month that shows that this state is near the bottom of the list in taking serious disciplinary action against physicians. The Department of Professional Regulation, which polices the medical profession, revoked only half the number of licenses in 2002 as it did the year before. However, the agency continues to overlook or oppose public policy proposals to crack down on dangerous practitioners, such as Patient Right to Know.

Taking a step in the direction of caps, as the Sun-Times puts it, appears to advocate an experimental approach to see if caps will works. But we don’t need such an experiment at the expense of consumers’ fundamental rights.

Before jumping on the caps bandwagon, the Sun-Times, physicians and consumers need to see the cargo it’s carrying. Or else they may find that the trail is set on a course for disaster.

Robert A. Clifford, Partner

Clifford Law Offices