In another case,7 a spouse who did not sign the contract filed a lawsuit for loss of consortium due to a physician’s negligence. The court found that all claims arising from the alleged malpractice must be arbitrated when a patient signs a contract agreeing to arbitrate claims of negligence. Similarly, heirs in a wrongful death action were found to be bound by the decedent’s agreement to arbitrate when the contract required that claims by the “member’s heir or personal representative” be arbitrated.8
Can a contract be enforced retroactively?
ObGyns often have long-term relationships with patients. Or they may wish to implement the provisions described above after 1 or several prenatal visits. Is it possible to design a new contract to address past actions?
Maybe.
In California, there is a precedent for retroactive activation of an arbitration agreement. In 1993, the California Court of Appeals upheld an arbitration agreement that was defined for both future and retroactive treatment.9
Will a patient sign such a contract?
The short answer is “Yes.” Patients sign contracts all the time. They agree to pay their bill. They agree that records can be sent to referring physicians. They agree that they have made an informed decision about their care.
Medical Justice Services has a long track record of promoting such contracts as part of the physician–patient relationship. We have found that most patients are comfortable signing a contract that limits their right to sue to cases with clear merit and requires them to use reputable and accountable experts if there is a legitimate dispute. In this way, patients who deserve a remedy have full access to the courts.
Bringing up the topic of a contract before care is initiated is no more likely to create tension than a traditional informed consent discussion would. Most patients believe themselves to be reasonable and cannot imagine filing a lawsuit for an illegitimate reason.
By deterring unjustified litigation, the widespread use of contracts can help stabilize professional liability premiums, minimize the cost of health care, and preserve access to health care. In cerebral palsy litigation, where the stakes are high, 1 of the better ways to control the legal outcome is by means of a contract, especially when there is minimal or no evidence of NEACP criteria.
And justice for all (including ObGyns)
Q&A with Jeffrey Segal, MD, founder and chief executive officer, Medical Justice Services
Q. What is Medical Justice Services? How does it work?
A. Medical Justice Services is a company designed to keep physicians from being sued for frivolous reasons by holding proponents of such suits accountable along several avenues. Our core mission is 3-fold:
- keep meritless suits from being filed in the first place
- engage in early intervention so that, if a suit without merit is filed, it gets dropped sooner rather than later
- give physicians workable, cost-effective remedies if they are sued.
Q. Will you give an example of how your service works?
A. Say a woman experiences a difficult labor and delivery, necessitating emergency cesarean section and immediate treatment of the infant in the neonatal intensive care unit, with lasting central nervous system damage. She blames her obstetrician and files a lawsuit against him. In response, Medical Justice Services sends a letter to the plaintiff and her attorney, notifying them that they may very well be sued if the allegations are found to be frivolous. Many meritless lawsuits end right there with a dismissal, sometimes as quickly as 1 to 3 weeks. But if the lawsuit goes to trial and the physician wins, other obstetrician members of Medical Justice Services will review the case. If they determine that the case was indeed frivolous, each and every proponent of the lawsuit can be countersued, and expert witnesses are at risk to face possible sanctions from their professional society.
That example is an oversimplification, but it conveys the essence of what we do.
Q. How did you come to start the company?
A. Although I practiced neurosurgery in Indiana, a state that is very friendly to physicians, we had our own professional liability crisis in the late 1970s. Fortunately, the governor at the time was also a physician, and he implemented substantive tort reform. Nevertheless, it became quite clear that, in my specialty, as in ObGyn medicine, we faced a heightened risk for malpractice lawsuits. And it seemed important to me to find a way to avoid just being on the receiving end of litigation, to stop being a pawn in a system that was poorly understood.
That was 5 years ago. We’ve been able to grow the organization fairly rapidly based on demand. The awful truth is that, if you practice long enough, your exposure to a lawsuit in most specialties is almost an actuarial certainty.
Q. How many plan members do you have, and what percentage are obstetricians?
A. We have approximately 1,600 members. I can’t tell you exactly how many are obstetricians, but I can say that obstetrics and gynecology is 1 of the 5 most common specialties, along with neurosurgery, orthopedic surgery, general surgery, and plastic surgery.
Q. What issues do ObGyns face that make protecting them especially challenging?
A. The most important thing is the fact that, in most states, there is a “long tail.” In contrast to other specialties, for which there is a relatively short statute of limitations, the length of time that an ObGyn case can linger out there as a potential case seems infinite. That’s because these cases usually involve an infant, who will not reach the age of majority for many years.
Q. Do ObGyns have to pay more to be a plan member?
A. We narrow our universe to 3 areas of risk: low, medium, and high. ObGyns fall into the highest-risk category, but with good company—namely, every surgical specialty.
Q. You mentioned 3 objectives for Medical Justice Services: deterrence, early intervention, and ample support should a lawsuit be filed. How do you go about deterring claims?
A. We engage in a contract with the patient, who is already in the habit of signing contracts for health care, as in the case of HIPAA, for example. We simply ask that a contract contain 2 additional clauses—that the patient will not sue the physician for a frivolous reason and that, if she does sue, she will use, as an expert, a board-certified physician in the same specialty who is a member of that specialty’s professional society and who follows that society’s code of ethics. We use more sophisticated language in the contract itself, of course, but it is easily understood by the patient.
Our experience has been that virtually every patient is happy and comfortable signing such a document.
Q. What does early intervention in a case involve?
A. We see what we can do to get a case dropped sooner, rather than later. We send notification to the opposite side that our plan member has the finances and expertise to legitimately file countersuits and counterclaims.
Q. When you do have to prosecute the other side, how do you go about it?
A. Prosecution means holding the opposite side accountable in a number of different venues. If appropriate, we pursue remedies against expert witnesses primarily through medical specialty societies after a case is terminated. Many of these societies, including ACOG, have panels that review testimony from members who have served as experts in court. They then make a determination as to whether this testimony supports or violates the code of ethics. And if they believe it violates the code of ethics, they may take any of several actions, from sending a letter of reprimand to expelling them from the society.
That’s not the only venue where a physician can find redress with an expert witness. One could also package a complaint before the state medical society, a hospital credentialing committee, and so on.
The next area where redress can be had is in court. We are prepared to file a countersuit against the attorney who brought the frivolous case forward. Although we can also go after the plaintiff, if need be, it is our opinion that the plaintiff usually doesn’t understand how he or she got into the legal case—that is, the patient is almost always a pawn in the system with the attorney driving the process.
Q. Are your services separate from liability insurance?
A. Yes, we stand separate from professional liability insurance. Although we can provide value to physicians who have no coverage whatsoever, by and large what we offer is synergistic with, or complementary to, traditional medical malpractice insurance.
Q. How does tort reform affect what you do?
A. It varies. California is the largest state to have implemented substantive tort reform, and I practiced there briefly, so I understand the local dynamics quite well.
The beauty of tort reform, at least in California, is that it keeps medical malpractice premiums lower than in other states by putting caps on pain and suffering. So it lessens the severity of a lawsuit. But what we have seen is that the frequency of lawsuits in places like California is not any lower than in other states. In fact, it’s higher.
And so the only rational conclusion you can draw is that plaintiff’s attorneys make up the difference in volume. In other words, tort reform has succeeded quite well in terms of keeping premiums down, but not nearly so well at keeping the frequency of lawsuits down.
Q. Can residents join Medical Justice Services?
A. We do have a plan for residents. We give them coverage, often with no charge, with the expectation that they will become bona fide plan members when they finish their training.
Q. How much does it cost an ObGyn to sign up with Medical Justice Services?
A. For an individual physician who desires go-forward coverage, the range is $1,250 to $1,900 a year—certainly far less than what he or she is paying for professional liability coverage, often by 2 orders of magnitude.
For “backward” or retroactive coverage, there is an additional 1-time cost that ranges from $2,800 to $4,500. And for coverage of an open malpractice case at the time they join, the 1-time additional charge ranges from $2,000 to $5,000.
The plan member is covered for legal expenses—generally, up to $100,000 a year—and has access to the company’s network of skilled attorneys.