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    Sunday, January 16, 2005

    Proof in the Pudding: In November, the RAND Institute released a study that looked at California's experience with tort reform. What they found is that it works:

    After evaluating the outcome of plaintiff wins in 257 medical liability trials that took place between 1995 and 1999, the study found that payments were 30% less than they would have been without the cap. The total payout would have been $421 million before the cap was applied but came to $295 million after judges reduced excess awards.

    'It gives us proof that MICRA is working extremely well,' said Richard Anderson, MD, chair of The Doctors Company, a physician-owned national medical liability insurer based in California. 'We have always said MICRA is worth 20% to 30% when all of the provisions of MICRA are used.'

    The study also showed that patients weren't seeing a 30% reduction in their awards.

    MICRA limits the amount that attorneys can collect, and the study showed that the combination of award caps and attorney's fee limits reduced the amount that plaintiffs' attorneys collected by 60%.

    Consequently, plaintiffs saw 15% less then they would have without the cap or attorney fee limits -- not the full 30% less. And after MICRA reductions, the total awards in most of the cases were still more than $1 million.

    But malpractice attorneys say that the study proves tort reform disproportionately punishes the weak:

    "It disproportionately affects seniors, stay-at-home moms and children," said Ken Sigelman, MD, a lawyer who is chair of the medical malpractice committee for the Consumer Attorneys of California.

    For example, the study showed that the plaintiffs who were younger than 1 year old most often saw reductions in their total awards when the ages of plaintiffs were considered: 71% of that age group experienced reductions. The median reduction was $1.5 million, according to the study. Other plaintiffs saw a median reduction of $268,000.

    The report also showed that women often have a larger cut to their overall verdict. Overall awards that women received had a median change of 34%when their noneconomic damages were adjusted. Men saw a 25% median reduction in their overall when caps were factored in.

    Last, trial lawyers point to the study's conclusion that plaintiffs who are 65 or older see 67% of their cases reduced by the cap. The median dollar reduction is smaller than any other age group because their awards are often close to the $250,000 cap.

    Women, children, and the elderly. Those would be plaintiffs who are more likely to get big awards based on pity rather than justice. Don't we want a system based on jurisprudence rather than on emotions? It isn't surprising that the attorneys find this disturbing. Emotionally manipulating juries in personal injury cases is what they do best.

    But here's another look at the same data by a lawyer who is also a physician:

    One observation from my study of the RAND report: If you omit the jury verdicts in the seven highest awards as "outlier" cases (that is, omit the top 3% of the cases, ranging from $4.7 million to $31.3 million), the conclusions of the study would change significantly. Rather than characterizing MICRA as penalizing "seniors, stay-at-home moms and children," the data clearly point out that the major savings occur in the area of attorney fees.

    The "little secret" of MICRA is not that it forces a significant limit on the awards of deserving, injured patients, but rather that it limits the amount of money received by the law firms representing those patients. Based on my calculations, the average net capped award received by 97% of the patients reported was reduced by only 7.5%, and in most cases even less than that. Over 80% of the savings of those cases occurred as a result of fee limits.

    In simple terms: The party who suffers most under MICRA is the plaintiff's attorney, not the plaintiff.

    MICRA's limits on unreasonable awards made by "juries gone wild" hurt the attorneys who encourage them, not the patients and families who need help.


    posted by Sydney on 1/16/2005 12:19:00 AM 0 comments


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