Malpractice Law May Deny Justice

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Lawyers, citing an award limit, often won’t take medical injury suits.

Dave Stewart’s 72-year-old mother went to Stanford University Medical Center
for double knee-replacement surgery in April. Four days later, she was

To Stewart, an anesthesiologist, it seemed a
classic case of medical malpractice. After the operation, his mother
developed sharp abdominal pain that she described as "10 on a scale of
1 to 10," according to her medical records.

hospital failed to diagnose the cause of her pain and continued to
treat her with narcotics. Her vital signs became unstable and she was
moved to the intensive care unit, but she died of complications from an
untreated bowel obstruction. State regulators cited the hospital in the
case this fall.

Stewart and his two sisters decided
to sue, and they approached two dozen lawyers. One after another
declined to take the case, always for the same reason: It wasn’t worth
the money.

In 1975, California enacted legislation
capping malpractice payments after an outcry from doctors and insurers
that oversized awards and skyrocketing insurance rates were driving
physicians out of the state.

The law limited the
amount of money for "pain and suffering" — usually the physical and
emotional stress caused from an injury — to $250,000. There is no
limit on what patients can collect for loss of future wages or other

Over the years, it has been easy to
quantify the effects of the law, known as the Medical Injury
Compensation Reform Act, or MICRA. In the years since the law was
enacted, malpractice premiums in California have risen by just a third
of the national average, and doctors say the law now helps attract
physicians to the state. Proponents also say it discourages frivolous

Thirty states have enacted similar
legislation. Two Republican presidential candidates — Mitt Romney and
Rudolph W. Giuliani — have recently endorsed the approach as a
possible national model.

It’s been harder to tally
the law’s costs. Critics say it is increasingly preventing victims and
their families from getting their day in court, especially low-income
workers, children and the elderly. Their reasoning: The cap on pain and
suffering has never been raised nor tied to inflation.

the costs of putting on trials are often paid by attorneys and continue
to rise each year. That means those who rely mainly on pain and
suffering awards — typically people who didn’t make much money at the
time of their injury — are increasingly unattractive to lawyers.

states have set their malpractice caps considerably higher than
California’s because of worries that they affected poorer patients the
most. Some state courts have begun to examine the fairness of their
malpractice laws, especially those not tied to inflation. California
lawmakers have rarely reconsidered the state’s malpractice legislation.

a Times analysis of state court records, physician payment data and
insurer financial records suggests that the cap is increasingly
preventing families such as the Stewarts from getting their day in

Among the findings:

Court malpractice filings have fallen in eight of the 10 most populous
counties in California that track such information. In Los Angeles,
they’re down 48% since 2001 to their lowest per-capita level in nearly
four decades. In Orange County, they fell 29% over the same period

At Kaiser Permanente, where members must resolve malpractice claims in
arbitration rather than court, claims have fallen almost 20% since 2001.

The number of payments to victims and their families across the state
was down 24% since 1991, according to a review of a federal government
database of nearly half a million claims. Nationally, the decline over
the same period was 10%.

* The malpractice earnings
of California insurers has far outpaced national averages in recent
years. According to financial reports, insurers in the state have paid
out just 39 cents of every premium dollar since 1991. The national
average was 63 cents.

Proponents of the law
attribute the state’s recent decline in malpractice lawsuits to several
reasons unrelated to its award cap, including a slight drop in overall
personal injury cases nationwide and a possible decrease in medical
errors in recent years.

Some states have seen
larger per-capita declines in malpractice cases than California, after
they enacted caps on medical malpractice awards.

spokesman for Kaiser Permanente said its drop in malpractice filings
was the result of a company program begun five years ago in which
doctors apologized to patients for errors rather than wait to fight the
accusations in court.

Some malpractice victims and
their families say the benefits of the law have swung too far in favor
of doctors. Without accountability, some ask, what will keep physicians
from making careless mistakes?

Craig Backer of
Caliente, near Bakersfield, suffered headaches for five years and
eventually lost hearing in his left ear. Although the former Marine
visited a Veterans Affairs hospital half a dozen times, doctors told
him his condition was temporary and never performed advanced screening
tests, according to his family.

Last spring, Backer
began having problems with his vision and returned for a battery of
exams. Doctors discovered that he had a large brain tumor and scheduled
surgery days later. It was successful, but Backer remains in the
hospital and can’t talk. He is also learning how to swallow again, and
the left side of his face droops. Doctors say they don’t know if he
will improve.

His wife, Jeriah, wants to sue but
the case is subject to California’s malpractice cap. Six lawyers have
turned her down. One told her that because her husband didn’t earn a
large income as a mechanic, the case wasn’t feasible. "We’re living a
nightmare," she said.

Linda Fermoyle Rice, one of the state’s best-known malpractice lawyers, says the law often leads to difficult trade-offs.

has had the effect of making an infant who is severely injured more
valuable than those who don’t make it, since families of children who
die are limited to the cap," said Rice, who is based in Woodland Hills.
"It’s sad to say, but most attorneys I know won’t take a dead-baby

A 2003 Rand Corp. report found that the law
has reduced jury awards by 30%, and that the savings have come largely
at the expense of severely injured or impaired patients.

average, California juries (which are rarely informed of the cap during
trials) awarded $800,000 in malpractice death cases from 1995 to 1999,
but the amounts were later reduced to $250,000 under the law. This
suggests that medical malpractice victims and their families could be
reaping much larger payouts than the law allows. But proponents of
MICRA say raising the cap could harm patients.

the MICRA cap would significantly increase healthcare costs, limiting
patient access to doctors, hospitals and clinics throughout
California," said Lisa Maas, executive director of Californians Allied
for Patient Protection, a trade group. "MICRA protects patient access
to healthcare."

San Diego obstetrician Philip
Diamond is skeptical that the law is keeping patients from obtaining
malpractice lawyers. But he acknowledged that limits on payouts do lead
to trade-offs.

"If we raise the cap, where does that money come from?" he asked. "Any increase means a drop in access."

The link between malpractice payouts and increases in doctors’ insurance premiums, though, remains unclear.

of the largest studies done on the topic — by Dartmouth College
researchers in 2003 — concluded that malpractice payments had risen in
line with medical care costs, whereas doctors’ insurance premiums grew
far faster — by double-digit percentages annually for some specialties.

some, that suggests that recent malpractice premium increases may have
had more to do with insurers’ business models and financial investments
— including documented losses in their investment portfolios in recent
years — than with their core businesses.

Nationally, the rise in malpractice premiums has slowed in recent years.

16.2% of insurers raised their malpractice premiums in 2007 compared to
77.3% in 2003," said the Medical Liability Monitor, a newsletter based
in Chicago.

Douglas Heller, executive director of
the Santa Monica-based Foundation for Taxpayer and Consumer Rights,
says the 1975 liability caps aren’t the reason that doctors’ insurance
premiums have been relatively low in California. He says the reason is
that, unlike other states, insurance is tightly regulated here. In a
1988 statewide vote, Proposition 103 rolled back all casualty insurance
rates by 20% and required the approval of the state insurance
commissioner for any rate increase.

rates rose sixfold between 1975 and 1988 despite the state’s awards
cap, Heller said, but have held roughly steady since Proposition 103’s

Stewart, of San Diego, said he had long
been a MICRA advocate, believing it was in the best interest of doctors
and patients. Not anymore.

After he and his family
got over the initial shock of losing their mother, they wanted justice.
Most attorneys turned them down over the phone, although three agreed
to meet in person. Last summer, the entire family and their 80-year-old
father made the trip to San Francisco and Oakland for meetings.

One lawyer said he would take the case only if the family paid the expected $50,000 in trial costs upfront.

Francisco lawyer Brad Corsiglia at first seemed interested but later
sent a letter dated July 11, 2007, that read: "As you can understand,
with a cap of $250,000, we are limited in the type of case we can take
on a contingency fee basis to only those cases that involve
catastrophic economic losses."

"In 1975 you could
buy a house for that money, and today what does it get you?" asked
Stewart, whose parents would have celebrated their 54th anniversary
last month. "Every year MICRA stays the same is another year that
people who have been wronged will be denied the same justice."

Stanford Medical Center declined to comment on the case.

state courts have struck down malpractice caps that didn’t rise over
time. Last month, an Illinois circuit court judge ruled
unconstitutional a 2005 state law that caps noneconomic damages in
medical liability cases. The case is on appeal.

2006, a Louisiana appeals court ruled that its state malpractice cap,
established in 1975, did not adequately compensate patients and needed
to be raised to $1.6 million. The ruling was overturned this year by
the state’s Supreme Court.

Some families who succeed at trial in California are often surprised at how little money they see in the end.

Dessenberger’s 2-year-old son, Jacob, died at Children’s Hospital in
Oakland in 2004 after surgery to repair a foot. Her son, who was
suffering from bronchitis, was given a high dose of pain medication
though the drug is known to cause slower breathing. He died the next

In 2006 the family settled with the hospital,
which acknowledged no wrongdoing, for just under the $250,000 cap.
After deducting for trial costs and lawyer fees, Dessenberger, 36, of
Suisun City, said the family received "a little over" $100,000.

Dessenberger said no money would help ease her grief, but the small amount felt to her and her family like a slap in the face.

"Because he was a baby, this is all he was worth," she said. "I think it is horrible. I don’t think it’s fair."


Contact the author at: [email protected]

Times staff writers Doug Smith and Sandra Poindexter contributed to this report.

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