17
May
2005
The Genesis Illini Medical Center in Silvis has lost 25 physicians in the past 24 months. That's roughly 10 percent of the hospital's doctors.
These aren't the losses that one would expect, such as planned retirements. Some doctors are retiring early, others are moving into teaching, and still others are leaving to practice medicine in other states.
"We saw 11 to 12 just cross the river," said Chuck Bruhn, CEO of the hospital. Those doctors have simply shifted their practices to Iowa, where the legal climate is more favorable, he said. In the past two years, he added, the hospital has dropped from nine trauma surgeons to three, and from four pulmonary doctors to one.
In the past three months, Trinity Regional Health System has had seven doctors - two orthopedists, two pulmonologists, and two general surgeons - quit providing medical care on the Illinois side of the river, instead limiting their practices to Iowa. According to Mark Valliere, the health system's vice president for medical affairs, Trinity lost six doctors at the end of last year, with two taking early retirement, one taking a teaching position, and three restricting their practices to Iowa.
This is the part of the medical-malpractice-insurance issue that the public takes note of - when a trusted doctor leaves because he or she can no longer afford insurance premiums. "It's an access issue," Bruhn said.
Organizations representing trial lawyers disagree. "This is a business issue," said Terrence Lavin, immediate past president of the Illinois State Bar Association, president of the Society of Trial Lawyers, and a Chicago-based attorney. "This is big business."
Attorneys don't dispute that rates for malpractice insurance in Illinois are too high and climbing. The points of contention are the cause and the solution. The Illinois State Medical Society blames an out-of-control court system, awarding millions of dollars in pain-and-suffering awards to plaintiffs. Lawyers, on the other hand, consider the problem twofold: barely regulated malpractice-insurance rates, and a lax discipline system that lets bad doctors continue to practice medicine.
Of course, the political battle here involves choosing between two well-heeled special interests - doctors and lawyers - that aren't naturally very sympathetic.
And while the medical community makes a dramatic case for tort reform, it's not necessarily the most effective argument; it's based on anecdotes and dubious statistics. Still, the doctors have the upper hand, because they're framing the issue in terms of access to health care.
"It's going to be very hard to staff an emergency room," Valliere said. "I want a doctor to be there when I need one."
The Battle for the Truth
The doctors and their affiliated political organizations make a logical case - that jury awards have gotten out of hand and need to be reined in. Once that happens, they say, malpractice premiums will stabilize.
So they propose a major change: limiting the amount a jury can award in noneconomic damages, given to cover pain and suffering. Legislation now before the Illinois House, House Bill 4074, would cap those awards at $250,000, although amendments have been offered to raise that amount to as much as $1 million. The bill passed out of the Judiciary Committee last week on a 12-2 vote.
Senate Bill 276, which was introduced last week, would cap noneconomic-damage awards at $500,000 for doctors.
The Illinois State Medical Society (ISMS) supports a 19-point plan for reforming the state's tort system and improving oversight of both physicians and the insurance industry. The medical society supports increasing state regulation of and adding transparency to the insurance industry.
For example, the ISMS has backed proposals that would allow the state's Department of Insurance to review whether malpractice rates are too high. Presently, it only has that power in a monopoly situation, when only one insurance carrier offers coverage in the state for a certain specialty.
Another component of the plan would require insurers to report county-by-county data on the number of malpractice claims and the amounts paid out for the past 10 years. This information would give insurance companies "extensive data on which to base and justify their rates," according to the ISMS.
Ironically, making this data available today could quiet much of the debate on the medical-malpractice issue. What's available now is selective and seemingly intentionally skewed to paint the starkest contrast between Illinois and surrounding states. A full, statewide picture of the situation could reinforce the ISMS's claims of a crisis - or support attorneys' arguments that malpractice awards aren't the source of the problem. "They never produce the closed-claim data," Lavin said.
Trinity's Valliere agreed that transparency in the insurance industry is an important issue. Doctors and the public don't have enough information to determine whether malpractice rates are out-of-line with costs. "I don't think they're opening heir books so that we can know that," he said.
Furthermore, he added, a cap will only be effective if insurance companies lower or stabilize their malpractice rates. If they don't, Valliere said, it might be time for the state to take a more active role in regulating rates. "If they [insurance companies] don't voluntarily do it [lower rates], then that might be the next solution," he said.
The ISMS also backs tougher regulation of doctors, increasing the number of investigators at the Illinois Department of Financial & Professional Regulation and boosting penalties for negligence fines.
Lavin and the Illinois State Bar Association argue that the only reforms that are needed are meaningful malpractice-rate regulation and measures that would reduce the frequency of malpractice. That would suggest there's room for compromise between these two sides, but Lavin said caps are not negotiable in the eyes of the attorneys' groups. "We will never say yes to caps," he stressed.
Even so, caps seem to be surprisingly popular with the legislature, considering that both houses of the Illinois General Assembly are controlled by Democrats. Although attorneys give large sums to money to Democrats, their arguments have fallen largely on deaf ears this year. (See Rich Miller's column on page 4.) Even Governor Rod Blagojevich, a Democrat who has long opposed pain-and-suffering caps, suggested last week that he wouldn't veto cap legislation. According to the Rockford Register Star, the governor said, "I'm not going to stand in the way of dramatic reform."
"We are pleasantly surprised" at the relative success of cap legislation, said Craig A. Backs, president of the ISMS. "This is not simply a debate between doctors and lawyers. ... This is really about public support."
Yet that public support is predicated primarily on anecdotal evidence rather than comprehensive data that shows the complete picture. For that reason, the lawyers have the advantage when it comes to truth-telling in this debate. But will it matter?
The Anecdotal Crisis
The "crisis" described by the Illinois State Medical Society is built on one major assumption: that doctors are leaving the state in frightening numbers. But the ISMS can't provide solid evidence that it's true.
"Anecdotes are necessary in this case," said Backs, an internist in Springfield. Membership in the Illinois State Medical Society is voluntary, but numbers have been stable.
And licensure figures from the Illinois Department of Professional & Financial Regulation - which show the number of licensed physicians in the state increasing - aren't a good measure, either, according to Backs. "That doesn't necessarily reflect the number of physicians delivering care," he said. For one thing, doctors who leave the state often maintain an Illinois license, he claimed.
So the ISMS has told personal stories of physician hardship, and used secondhand research. The Belleville News-Democrat has documented roughly 160 doctors leaving the Metro East area in recent years, Backs said, most citing the cost of malpractice insurance.
While those statistics and stories are compelling, they don't represent proof of a statewide trend. Furthermore, there's contradictory data.
In a study commissioned by the Illinois State Bar Association and released last week, two Duke University professors deflated the doctor-flight argument significantly. The report (available online at (http://www.isba.org/downloadnow/medicalmalpracticestudy.pdf) uses data from the American Medical Association's annual Physician Characteristics & Distribution in the U.S. report. That document classifies doctors as patient-care physicians, "inactive," engaged in "other professional activity," or "not classified." The authors only considered those doctors who classified themselves as patient-care physicians and found that the number of active, practicing doctors in Illinois rose from 24,514 in 1993 to 30,264 in 2003.
The authors qualify that data, noting that "some physicians may only be working part-time and others may have limited their practices, e.g., abandoned surgery, certain types of surgery, or stopped delivering babies." Yet the data goes a long way to countering the stories put out by the ISMS. And if doctors aren't leaving the state en masse, how much of a crisis can there be?
Other statistics put out by the ISMS are seemingly deliberately misleading. The report The Medical Litigation Crisis (available online at (http://www.isms.org/realmedicine/info/MedicalLitigationCrisis.pdf) offers some startling information. For instance, average jury awards for malpractice in Cook County jumped from $1.07 million in 1998 to $4.45 million in 2003 - an increase of 314 percent in five years. Average noneconomic-damage awards skyrocketed from $898,000 in 1998 to $3.12 million in that same period - a rise of 247 percent.
But is Cook County representative? What about other parts of the state? And what about the total amount paid out by insurance companies for medical-malpractice awards?
The Illinois State Bar Association's study also poked holes in that claim, saying that the uncapped system in Illinois isn't producing outrageous verdicts in the Metro East area: "Over a 14-year period from 1992 through the first part of 2005, only 11 jury verdicts favoring the plaintiff in medical-malpractice cases were found in Madison and St. Clair county courts. Only two verdicts exceeded $1 million."
"The study shows the Illinois tort system does not appear to be the cause of the increase in doctors' liability insurance premiums," Illinois State Bar Association President Ole Bly Pace III wrote in a letter to legislators. "It is time to consider other causes."
A study commissioned by the Bush Administration to look at the issue is due later this month, and is expected to favor stronger physician discipline over caps on jury awards, even though the administration supports the award limits. "If you take the worst performers out of practice, that will have an impact," researcher Randall R. Bovbjerg told the New York Times in January. The study will likely point to Massachusetts' discipline system as a model. Over 10 years, "one-fourth of 1 percent of all doctors ... accounted for more than 13 percent of all the malpractice payments," a state official told the newspaper.
The ISMS bolsters its case with comparisons between the medical-malpractice rates of Illinois and surrounding states with award caps. For example, Illinois' rates are 34 percent and 320 percent higher in the field of anesthesiology than Missouri and Wisconsin, respectively. Internal-medicine rates range from 78 percent to 434 percent higher than Missouri and Wisconsin, respectively.
But the fine print tells a different story; those malpractice rates include only Cook, Madison, St. Clair, and Will counties in Illinois - in other words, the major metropolitan areas. "They're cherry-picking," Lavin said
The Illinois State Medical Society's inability - or refusal - to offer the public and politicians meaningful, statewide statistics about physician exodus or insurance premiums makes its case fallible.
Lavin said the ISMS has a clear conflict on interest. ISMIE Mutual is the "officially endorsed professional liability carrier of Illinois State Medical Society members," according the ISMS Web site, as well as the largest medical-liability insurer in the state, covering more than half of Illinois' doctors. The Medical Litigation Crisis is a joint publication between the two bodies, and Lavin said the medical society's agenda has benefited the insurance company to the detriment of its member doctors, particularly as it pertains to their medical-malpractice insurance rates.
Crain's Chicago Business in June 2004 reported that ISMIE Mutual had a profit of $19.8 million in 2003, which followed a malpractice-insurance rate hike of 35.2 percent. The publication later reported that the company paid out $150.4 million in malpractice claims in 2004, down 10 percent from 2003.
ISMIE claims that Crain's "badly misrepresented" its financial situation. "Crain's' highly selective extraction of ISMIE financial data ... fabricates the perception of stability, when the full picture clearly demonstrates a disturbing trend of total costs far exceeding medical inflation," ISMIE Chair Harold L. Jensen wrote in a letter to the editor.
The Local Picture
Anecdotal though it is, the fact is that some parts of the state, particularly border areas, are losing physicians.
Because of its location on the border between two states, the Quad Cities have felt the effect. Iowa is the only Illinois neighbor that doesn't have a cap. The ISMS writes in The Medical Litigation Crisis: "The average indemnity in Iowa is about one-third the average in Illinois, and claims are filed at a much lower rate. What this means is that in most cases, physicians moving from Illinois to Iowa can expect their premiums to be at least half of what they paid in Illinois."
Trinity's Valliere said that doctors practicing both in Illinois and Iowa pay a surcharge of roughly 20 percent on their malpractice insurance.
Genesis' Bruhn said that high jury awards in Illinois' large urban areas are spread across all the state's policyholders, so that even though there's little difference in the number of malpractice suits filed in Rock Island and Scott counties, the premiums are higher in Illinois.
And so doctors leave, and hospitals have difficulty finding physicians to replace them. "Illinois has gotten such a poor reputation," Bruhn said. "Recruitment is a big, big consequence of this." One urology group tried for more than two years to replace a doctor, he said, and eventually gave up, hiring a physician assistant instead.
Trinity has been able to replace only one of the physicians who has left Illinois practice recently, Valliere said.
Genesis has taken several approaches to address the problem in the short term, Bruhn said, including hiring doctors so that the hospital can take care of their medical-malpractice insurance. Already, the hospital has 70 family-practice doctors, obstetricians/gynecologists, and internists on staff. The hospital is exploring the possibility of hiring specialists now. Genesis has also formed its own insurance company.
But those measures shift, rather than solve, the problem. "It's only temporary," Bruhn said.
Trinity, too, has hired some of its formerly independent physicians, two since the beginning of the year, Valliere said. The health system now employs roughly a half-dozen primary-care physicians, he said.
Doctors and hospitals hope to get relief from the Illinois General Assembly this year, and they have a major advantage when it comes to this public-relations struggle: their patients. Every time a doctor leaves the state, it has the potential to mobilize more citizens. "It's key that we get more of the public involved," Bruhn said. "They become involved when they lose their physicians."
"We saw 11 to 12 just cross the river," said Chuck Bruhn, CEO of the hospital. Those doctors have simply shifted their practices to Iowa, where the legal climate is more favorable, he said. In the past two years, he added, the hospital has dropped from nine trauma surgeons to three, and from four pulmonary doctors to one.
In the past three months, Trinity Regional Health System has had seven doctors - two orthopedists, two pulmonologists, and two general surgeons - quit providing medical care on the Illinois side of the river, instead limiting their practices to Iowa. According to Mark Valliere, the health system's vice president for medical affairs, Trinity lost six doctors at the end of last year, with two taking early retirement, one taking a teaching position, and three restricting their practices to Iowa.
This is the part of the medical-malpractice-insurance issue that the public takes note of - when a trusted doctor leaves because he or she can no longer afford insurance premiums. "It's an access issue," Bruhn said.
Organizations representing trial lawyers disagree. "This is a business issue," said Terrence Lavin, immediate past president of the Illinois State Bar Association, president of the Society of Trial Lawyers, and a Chicago-based attorney. "This is big business."
Attorneys don't dispute that rates for malpractice insurance in Illinois are too high and climbing. The points of contention are the cause and the solution. The Illinois State Medical Society blames an out-of-control court system, awarding millions of dollars in pain-and-suffering awards to plaintiffs. Lawyers, on the other hand, consider the problem twofold: barely regulated malpractice-insurance rates, and a lax discipline system that lets bad doctors continue to practice medicine.
Of course, the political battle here involves choosing between two well-heeled special interests - doctors and lawyers - that aren't naturally very sympathetic.
And while the medical community makes a dramatic case for tort reform, it's not necessarily the most effective argument; it's based on anecdotes and dubious statistics. Still, the doctors have the upper hand, because they're framing the issue in terms of access to health care.
"It's going to be very hard to staff an emergency room," Valliere said. "I want a doctor to be there when I need one."
The Battle for the Truth
The doctors and their affiliated political organizations make a logical case - that jury awards have gotten out of hand and need to be reined in. Once that happens, they say, malpractice premiums will stabilize.
So they propose a major change: limiting the amount a jury can award in noneconomic damages, given to cover pain and suffering. Legislation now before the Illinois House, House Bill 4074, would cap those awards at $250,000, although amendments have been offered to raise that amount to as much as $1 million. The bill passed out of the Judiciary Committee last week on a 12-2 vote.
Senate Bill 276, which was introduced last week, would cap noneconomic-damage awards at $500,000 for doctors.
The Illinois State Medical Society (ISMS) supports a 19-point plan for reforming the state's tort system and improving oversight of both physicians and the insurance industry. The medical society supports increasing state regulation of and adding transparency to the insurance industry.
For example, the ISMS has backed proposals that would allow the state's Department of Insurance to review whether malpractice rates are too high. Presently, it only has that power in a monopoly situation, when only one insurance carrier offers coverage in the state for a certain specialty.
Another component of the plan would require insurers to report county-by-county data on the number of malpractice claims and the amounts paid out for the past 10 years. This information would give insurance companies "extensive data on which to base and justify their rates," according to the ISMS.
Ironically, making this data available today could quiet much of the debate on the medical-malpractice issue. What's available now is selective and seemingly intentionally skewed to paint the starkest contrast between Illinois and surrounding states. A full, statewide picture of the situation could reinforce the ISMS's claims of a crisis - or support attorneys' arguments that malpractice awards aren't the source of the problem. "They never produce the closed-claim data," Lavin said.
Trinity's Valliere agreed that transparency in the insurance industry is an important issue. Doctors and the public don't have enough information to determine whether malpractice rates are out-of-line with costs. "I don't think they're opening heir books so that we can know that," he said.
Furthermore, he added, a cap will only be effective if insurance companies lower or stabilize their malpractice rates. If they don't, Valliere said, it might be time for the state to take a more active role in regulating rates. "If they [insurance companies] don't voluntarily do it [lower rates], then that might be the next solution," he said.
The ISMS also backs tougher regulation of doctors, increasing the number of investigators at the Illinois Department of Financial & Professional Regulation and boosting penalties for negligence fines.
Lavin and the Illinois State Bar Association argue that the only reforms that are needed are meaningful malpractice-rate regulation and measures that would reduce the frequency of malpractice. That would suggest there's room for compromise between these two sides, but Lavin said caps are not negotiable in the eyes of the attorneys' groups. "We will never say yes to caps," he stressed.
Even so, caps seem to be surprisingly popular with the legislature, considering that both houses of the Illinois General Assembly are controlled by Democrats. Although attorneys give large sums to money to Democrats, their arguments have fallen largely on deaf ears this year. (See Rich Miller's column on page 4.) Even Governor Rod Blagojevich, a Democrat who has long opposed pain-and-suffering caps, suggested last week that he wouldn't veto cap legislation. According to the Rockford Register Star, the governor said, "I'm not going to stand in the way of dramatic reform."
"We are pleasantly surprised" at the relative success of cap legislation, said Craig A. Backs, president of the ISMS. "This is not simply a debate between doctors and lawyers. ... This is really about public support."
Yet that public support is predicated primarily on anecdotal evidence rather than comprehensive data that shows the complete picture. For that reason, the lawyers have the advantage when it comes to truth-telling in this debate. But will it matter?
The Anecdotal Crisis
The "crisis" described by the Illinois State Medical Society is built on one major assumption: that doctors are leaving the state in frightening numbers. But the ISMS can't provide solid evidence that it's true.
"Anecdotes are necessary in this case," said Backs, an internist in Springfield. Membership in the Illinois State Medical Society is voluntary, but numbers have been stable.
And licensure figures from the Illinois Department of Professional & Financial Regulation - which show the number of licensed physicians in the state increasing - aren't a good measure, either, according to Backs. "That doesn't necessarily reflect the number of physicians delivering care," he said. For one thing, doctors who leave the state often maintain an Illinois license, he claimed.
So the ISMS has told personal stories of physician hardship, and used secondhand research. The Belleville News-Democrat has documented roughly 160 doctors leaving the Metro East area in recent years, Backs said, most citing the cost of malpractice insurance.
While those statistics and stories are compelling, they don't represent proof of a statewide trend. Furthermore, there's contradictory data.
In a study commissioned by the Illinois State Bar Association and released last week, two Duke University professors deflated the doctor-flight argument significantly. The report (available online at (http://www.isba.org/downloadnow/medicalmalpracticestudy.pdf) uses data from the American Medical Association's annual Physician Characteristics & Distribution in the U.S. report. That document classifies doctors as patient-care physicians, "inactive," engaged in "other professional activity," or "not classified." The authors only considered those doctors who classified themselves as patient-care physicians and found that the number of active, practicing doctors in Illinois rose from 24,514 in 1993 to 30,264 in 2003.
The authors qualify that data, noting that "some physicians may only be working part-time and others may have limited their practices, e.g., abandoned surgery, certain types of surgery, or stopped delivering babies." Yet the data goes a long way to countering the stories put out by the ISMS. And if doctors aren't leaving the state en masse, how much of a crisis can there be?
Other statistics put out by the ISMS are seemingly deliberately misleading. The report The Medical Litigation Crisis (available online at (http://www.isms.org/realmedicine/info/MedicalLitigationCrisis.pdf) offers some startling information. For instance, average jury awards for malpractice in Cook County jumped from $1.07 million in 1998 to $4.45 million in 2003 - an increase of 314 percent in five years. Average noneconomic-damage awards skyrocketed from $898,000 in 1998 to $3.12 million in that same period - a rise of 247 percent.
But is Cook County representative? What about other parts of the state? And what about the total amount paid out by insurance companies for medical-malpractice awards?
The Illinois State Bar Association's study also poked holes in that claim, saying that the uncapped system in Illinois isn't producing outrageous verdicts in the Metro East area: "Over a 14-year period from 1992 through the first part of 2005, only 11 jury verdicts favoring the plaintiff in medical-malpractice cases were found in Madison and St. Clair county courts. Only two verdicts exceeded $1 million."
"The study shows the Illinois tort system does not appear to be the cause of the increase in doctors' liability insurance premiums," Illinois State Bar Association President Ole Bly Pace III wrote in a letter to legislators. "It is time to consider other causes."
A study commissioned by the Bush Administration to look at the issue is due later this month, and is expected to favor stronger physician discipline over caps on jury awards, even though the administration supports the award limits. "If you take the worst performers out of practice, that will have an impact," researcher Randall R. Bovbjerg told the New York Times in January. The study will likely point to Massachusetts' discipline system as a model. Over 10 years, "one-fourth of 1 percent of all doctors ... accounted for more than 13 percent of all the malpractice payments," a state official told the newspaper.
The ISMS bolsters its case with comparisons between the medical-malpractice rates of Illinois and surrounding states with award caps. For example, Illinois' rates are 34 percent and 320 percent higher in the field of anesthesiology than Missouri and Wisconsin, respectively. Internal-medicine rates range from 78 percent to 434 percent higher than Missouri and Wisconsin, respectively.
But the fine print tells a different story; those malpractice rates include only Cook, Madison, St. Clair, and Will counties in Illinois - in other words, the major metropolitan areas. "They're cherry-picking," Lavin said
The Illinois State Medical Society's inability - or refusal - to offer the public and politicians meaningful, statewide statistics about physician exodus or insurance premiums makes its case fallible.
Lavin said the ISMS has a clear conflict on interest. ISMIE Mutual is the "officially endorsed professional liability carrier of Illinois State Medical Society members," according the ISMS Web site, as well as the largest medical-liability insurer in the state, covering more than half of Illinois' doctors. The Medical Litigation Crisis is a joint publication between the two bodies, and Lavin said the medical society's agenda has benefited the insurance company to the detriment of its member doctors, particularly as it pertains to their medical-malpractice insurance rates.
Crain's Chicago Business in June 2004 reported that ISMIE Mutual had a profit of $19.8 million in 2003, which followed a malpractice-insurance rate hike of 35.2 percent. The publication later reported that the company paid out $150.4 million in malpractice claims in 2004, down 10 percent from 2003.
ISMIE claims that Crain's "badly misrepresented" its financial situation. "Crain's' highly selective extraction of ISMIE financial data ... fabricates the perception of stability, when the full picture clearly demonstrates a disturbing trend of total costs far exceeding medical inflation," ISMIE Chair Harold L. Jensen wrote in a letter to the editor.
The Local Picture
Anecdotal though it is, the fact is that some parts of the state, particularly border areas, are losing physicians.
Because of its location on the border between two states, the Quad Cities have felt the effect. Iowa is the only Illinois neighbor that doesn't have a cap. The ISMS writes in The Medical Litigation Crisis: "The average indemnity in Iowa is about one-third the average in Illinois, and claims are filed at a much lower rate. What this means is that in most cases, physicians moving from Illinois to Iowa can expect their premiums to be at least half of what they paid in Illinois."
Trinity's Valliere said that doctors practicing both in Illinois and Iowa pay a surcharge of roughly 20 percent on their malpractice insurance.
Genesis' Bruhn said that high jury awards in Illinois' large urban areas are spread across all the state's policyholders, so that even though there's little difference in the number of malpractice suits filed in Rock Island and Scott counties, the premiums are higher in Illinois.
And so doctors leave, and hospitals have difficulty finding physicians to replace them. "Illinois has gotten such a poor reputation," Bruhn said. "Recruitment is a big, big consequence of this." One urology group tried for more than two years to replace a doctor, he said, and eventually gave up, hiring a physician assistant instead.
Trinity has been able to replace only one of the physicians who has left Illinois practice recently, Valliere said.
Genesis has taken several approaches to address the problem in the short term, Bruhn said, including hiring doctors so that the hospital can take care of their medical-malpractice insurance. Already, the hospital has 70 family-practice doctors, obstetricians/gynecologists, and internists on staff. The hospital is exploring the possibility of hiring specialists now. Genesis has also formed its own insurance company.
But those measures shift, rather than solve, the problem. "It's only temporary," Bruhn said.
Trinity, too, has hired some of its formerly independent physicians, two since the beginning of the year, Valliere said. The health system now employs roughly a half-dozen primary-care physicians, he said.
Doctors and hospitals hope to get relief from the Illinois General Assembly this year, and they have a major advantage when it comes to this public-relations struggle: their patients. Every time a doctor leaves the state, it has the potential to mobilize more citizens. "It's key that we get more of the public involved," Bruhn said. "They become involved when they lose their physicians."
