Cover Story - August 2008
Tex Med. 2008;104(8):22-28.
By Crystal Conde
"The price of freedom is eternal vigilance."
Thomas Jefferson's poignant words resonate today with the Texas Medical Association and other champions of Texas' medical liability reforms. They are preparing to battle trial lawyers who threaten to chip away at the provisions that have improved access to health care for the state's most vulnerable patients in the most underserved areas.
Five years ago, the Texas Legislature passed the Medical Malpractice and Tort Reform Act of 2003 under House Bill 4. Several months later, voters approved Proposition 12, an amendment to the Texas Constitution that authorizes the legislature to cap noneconomic damages in health care liability cases. The tort reform act doesn't limit recovery of economic damages.
Since 2003, physicians have enjoyed lower medical liability insurance premiums, and Texas is a more attractive state in which to practice medicine. (See " Physicians Benefit From Lower Premiums, Better Recruiting .")
Despite the evidence of tort reform's positive effects on Texas' medical climate, the more favorable liability landscape that benefits patients and physicians is in danger from forces that seek to overturn the landmark reforms both in the courts and in the legislature.
The legal challenges are coming in both federal and state courts.
A federal class action lawsuit filed in February in Marshall attacks the constitutionality of Texas' $750,000 cap, which includes a $250,000 limit on physician exposure for noneconomic damages such as pain and suffering. Attorneys for individuals involved in 11 ongoing legal cases consolidated them into one class action suit, Emma Watson, et al. v. Harrison County Hospital Association, et al .
Defendants include health care professionals and two trial court judges named as class representatives who enforce the cap under Texas law. The lawsuit alleges the noneconomic damage cap violates the following provisions of the U.S. Constitution: right to trial by jury, right to petition, right to due process, and equal protection.
Most well known among the 11 cases is a lawsuit filed in January in state District Court of Dallas County on behalf of Adriane Springs, the wife of former Dallas Cowboys running back Ron Springs. (See " Tort Reform Under Attack ," March 2008 Texas Medicine , pages 27-29.) The lawsuit alleges an anesthesiologist, an anesthesia group, and a plastic surgeon were grossly negligent in administering anesthesia to Mr. Springs at Medical City Hospital in Dallas.
The Springs family seeks an unspecified amount of actual, exemplary, and punitive damages from the physician defendants and their practices for Mr. Springs' past, present, and future loss of earnings, medical expenses, pain and suffering, and loss of enjoyment of life.
The Texas Alliance for Patient Access (TAPA), of which TMA is a charter member, is coordinating the defense for the lawsuit's challenge of the constitutionality of the noneconomic damage cap. TAPA General Counsel Mike Hull, JD, says U.S. District Judge T. John Ward has not indicated when he will make a decision, but he would not be surprised if the judge decides within the year.
Fortunately, history is on Texas' side. Mr. Hull says a federal court has never made a final decision to overturn a state court's limit on damages.
Tort reform also is under attack from trial lawyers in state court, but this time medicine took the offensive.
TMA, TAPA, and the Texas Hospital Association (THA) joined John D. McKeever, MD, a Corpus Christi orthopedic surgeon, in February to ask a state district judge in Austin to issue a declaratory judgment pronouncing the noneconomic damage cap constitutional under Texas law.
They were responding to a lawsuit against Dr. McKeever that attempts to find the noneconomic damage cap unconstitutional. The plaintiff, Adrian Cerny, alleges the damage cap is unconstitutional under various provisions of the Texas Constitution, including equal protection, open courts, due course of law, separation of legislative and judicial powers, local or special law, jury trial, and the constitutional amendment pertaining to legislative limitation on certain damages.
Another lawsuit filed by James Zagone in Jefferson County District Court against Christus St. Elizabeth Hospital and Beaumont Bone & Joint Institute was added to the McKeever case. The judge in the case, John D. McKeever, MD, et al. v. Adrian Cerny and James Zagone , heard the plaintiffs' motion for summary judgment in June, but had not ruled at press time.
A Line in the Sand
David Teuscher, MD, a Beaumont orthopedic surgeon and former chair of TMA's Committee on Professional Liability, is confident trial lawyers will fail in their quest to bust the noneconomic damage cap.
"I don't see the noneconomic cap at play now because we went the extra measure of passing the constitutional amendment," he said. "I do see other provisions at play, such as the burden of proof in emergency medical care."
He has reason for concern. Trial lawyers tried and failed to reduce the burden of proof in emergency cases in the 2007 legislative session. They're expected to try again next year. (See " Trial Lawyers Eye Legislative Attack on Tort Reforms .")
Dr. Teuscher vows that trial lawyers won't be able to overturn the noneconomic damage cap or any provision of HB 4 without a fight.
"I can tell you personally, if they want to take the cap away, they're going to have to pry it out of my cold, dead, political hands," he said. "I'll do whatever it takes. We physicians knew we needed this as a state. Tort reform helps our patients, and it made the practice of medicine better in Texas."
Mr. Hull says plaintiff's attorneys are attacking the cap with "renewed vigor."
"They're pushing an agenda that's a detriment to access to health care. We want more doctors. They are pursuing an agenda that would lead to fewer doctors," he said.
The battle extends to the campaign trail, as well. According to Donald P. Wilcox, JD, vice president and general counsel for TMA, the Texas trial bar is ready to challenge lawmakers who support tort reform in the November election and overturn the reforms of 2003 by swaying any newly elected officials they're able to usher into the legislature.
With tort reform under fire in Texas, it's more important than ever for physicians to remain steadfast and vocal in their support of HB 4 and Proposition 12.
Melissa Garretson, MD, a Fort Worth pediatrician, urges her colleagues to continue talking to patients about the improvements brought about by medical liability reform. (See " Reform Improves Access to Care .")
"The thing that's hard to remember is that we're not done with reform. This is a lifetime fight that will always be an issue," she said. "Part of the reason is the group of people who used to make millions off of doctors and patients. They're trying to get their million-dollar business back."
TAPA Chair Howard Marcus, MD, of Austin, says physicians must continue to fight the opposition to tort reform because trial lawyers will continue to assault the noneconomic damage cap and other provisions indefinitely.
"It is in the trial lawyers' interest to attack tort reform because their business has been cut significantly. Tort reform has dramatically reduced the transfer of wealth from health care to the lawyers," he said. "If we stand up to these attacks and continue to show the legislature how beneficial tort reform has been, then the trial lawyer smear campaign against professional liability reform will fail."
TMA, TAPA, and THA, along with other tort reform advocates, are working to preserve the cap and other tort reform provisions in the courts and in the legislature. TMA's Mr. Wilcox calls on organized medicine and its allies to work together to assure access to care remains uncompromised.
Learning From the Past
The Texas Medical Liability and Insurance Improvement Act of 1977 endured years of litigation and court interpretations before the Texas Supreme Court levied a fatal blow to the law in 1988. In Lucas v. United States , the court ruled that the caps limiting medical liability damages violated the open court guarantees in the Texas Constitution.
In the intervening election cycles up to 2002, organized medicine campaigned to reform the tort system by amending the state constitution to include a provision that allows legislators to set a cap on noneconomic damages in medical liability cases. Throughout this time, the TMA Political Action Committee ( TEXPAC ) kept its focus on identifying and pursing opportunities to elect members to the Texas Legislature who would work with the physician community to achieve meaningful tort reform.
"We learned our lesson in 1988 that if you don't amend the constitution, you can't count on lawyers and black robes to uphold the cap for you," Dr. Teuscher said.
Former State Rep. Joe Nixon, JD, authored and sponsored HB 4 and Proposition 12 in the legislature. He credits the bill's passage to bipartisan support. After a record two weeks of debate, HB 4 emerged victorious.
"At the end of the day, we had a bill that got 27 out of 31 votes in the Senate and 111 out of 150 votes in the House. It had tremendous bipartisan support," Mr. Nixon said. "Prop 12 passed in underserved areas, which traditionally vote Democrat."
Lisa Maas, executive director of Californians Allied for Patient Protection, praises Texas voters for enacting additional reforms to set limits on noneconomic damages. California's Medical Injury Compensation Reform Act of 1975 (MICRA) was a model for Texas' reform in 2003. MICRA allows unlimited economic damages (like Texas) but doesn't include a constitutional provision that allows lawmakers to set a noneconomic damage cap.
Trial lawyers have challenged the California cap, and it has withstood each test since 1975. California attorney and appellate specialist Curtis A. Cole, JD, says in 1985 trial lawyers argued in Fein v. Permanente Medical Group that MICRA's $250,000 noneconomic damage cap denies due process and violates the equal protection clause in the state's constitution.
The plaintiff, Lawrence Fein, received a jury award of $500,000 for noneconomic losses in his lawsuit against the medical group. In accordance with state law, the judge reduced the award to $250,000. Mr. Fein appealed to the California Supreme Court, which upheld the cap and said it rationally related to the state's interest in reducing medical liability costs.
The U.S. Supreme Court then dismissed the appeal ''for want of a substantial federal question.''
Mr. Cole, who represented the defendant in the case, emphasizes the need for organized medicine, the professional and trade associations, and insurers in Texas to continually contest the cases that challenge tort reform.
"Another thing that can be done is that the attorneys who represent doctors should coordinate their efforts to ensure they're making consistent arguments and working hard to enforce all of the provisions of the tort reform statute," he said.
Dr. Marcus calls on his fellow physicians to preserve tort reform and to ensure the state's medical climate doesn't revert to a time of skyrocketing medical liability insurance premiums, jackpot jury awards, and a stagnant physician workforce in Texas.
"We're interested in protecting access to care," he said. "We don't want to see doctors have to withdraw from hospital practice and the emergency room or from offering critical services because of the threat of a frivolous lawsuit."
Crystal Conde can be reached at (800) 880-1300, ext. 1385, or (512) 370-1385; by fax at (512) 370-1629; or by e-mail at Crystal Conde .
Reform Improves Access to Care
Fort Worth pediatrician Melissa Garretson, MD, says tort reform benefits her professionally and personally. Through her work at Cook Children's Medical Center, she recognizes the increased access to care patients receive.
The hospital has been able to recruit three pediatric neurosurgeons. Before 2003, the hospital had only one.
"That has elevated the care these special children have received. It's nice to be able to offer parents the best care for their children," she said.
With more specialists to care for children with brain tumors and trauma, Dr. Garretson says numerous lives have been saved. The neurosurgeons also perform state-of-the-art epilepsy surgery.
On a personal note, the physician appreciates that an orthopedist performed a spinal fusion operation on her stepmother, who suffers from cardiovascular disease and diabetes and has a history of a bleeding ulcer. The surgery had to be performed in two parts with two days of intensive care in between.
"Prior to tort reform, I don't know whether anyone would have done it," she said. "It's a risky surgery. To be able to provide that surgery to my stepmother meant a lot to our family. She's now doing great."
Fort Worth and Tarrant County also benefit from the expertise of four pediatric gastroenterologists. Before tort reform, Dr. Garretson says, the area had only one.
As of May 2007, additional physicians working in Tarrant County since the 2003 reforms totaled 403. Statistics compiled by the Texas Alliance for Patient Access indicate the physician workforce growth rate outpaced population growth in Tarrant County by 205 percent from 2003 to 2007. That growth rate produces the opportunity for 319,500 more patient visits per year.
From 2003 to 2007, the county attracted 61 family physicians, 41 emergency medicine physicians, 35 internists, 24 pediatricians, 20 cardiologists, 19 orthopedic surgeons, 17 gastroenterologists, 16 oncologists, 16 psychiatrists, and 15 obstetricians.
Because of the positive influence she's seen tort reform have on Fort Worth and the entire state of Texas, Dr. Garretson says it's vital the noneconomic damage cap and other provisions prevail in the courts and legislature.
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Physicians Benefit From Lower Premiums, Better Recruiting
The Texas Medical Liability Trust ( TMLT ), the largest physician insurer in Texas with a current policyholder count of 14,585, has reduced rates five times since 2003: 12 percent in 2004, 5 percent in 2005 and 2006, 7.5 percent in 2007, and 6.5 percent this year. Policyholders also will receive a 22-percent dividend this year.
The net effect of TMLT's cumulative rate reductions amounts to 31 percent from 2003's rates and approximately $200 million in premium savings. Renewing policyholders have received dividends that amount to approximately $75 million since 2003.
TMLT's claims intake is down, too. In 2003, the company received 2,880 claims. In 2007, claims totaled 1,381.
Physicians also enjoy overhead savings and the ability to recruit more specialists trained in Texas and from out of state. The Texas Medical Board (TMB) received 4,041 physician license applications during fiscal year 2007 and issued 3,324 new licenses. TMB's fiscal year runs Sept. 1 to Aug. 31.
Jill Wiggins, TMB public information officer, says the board is on track to issue about the same number of licenses this year as last year. As of April, TMB had received 2,060 license applications.
In 2003, TMB received only 2,561 applications and processed 2,513.
Demand to practice medicine in Texas is so high that TMB is experiencing a backlog of applications. In May 2007, TMB had a processing backlog of 2,533 license applications. In June, the backlog dropped to 2,253.
Ms. Wiggins specifies that the backlog includes applicants TMB has screened but who have yet to submit documents required to be assigned a licensure analyst.
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Trial Lawyers Eye Legislative Attack on Tort Reforms
By Ken Ortolon
While Texas physicians are maintaining their vigilance defending the 2003 medical liability reforms in the courts, physicians also are preparing to wage the battle again in the legislature.
In 2007, trial lawyers mounted legislative attacks on the reforms on more than one front, and leaders of both the Texas Medical Association and the Texas Alliance for Patient Access (TAPA) expect an even broader attack in 2009.
Howard Marcus, MD, TAPA chair, says he expects at least two direct attacks on the $250,000 cap on noneconomic damages.
"They're going to try to increase the cap in some way, most likely to index it to inflation," Dr. Marcus said. "In addition, the trial lawyers want to change the cap from one cap per lawsuit for all defendant physicians to one cap for each claimant. In cases with multiple claimants, the cap could be multiplied."
At a Senate State Affairs Committee hearing in April, former Texas Trial Lawyers Association President Jay Harvey, JD, told lawmakers the $250,000 cap was "artificially low when it was passed" and is not worth as much today because of inflation. Lawmakers should tie the cap to the consumer price index, he said.
He also complained that the cap is unfair in cases with multiple defendants or plaintiffs. There should be a separate cap for each plaintiff and each defendant in a malpractice case, he said.
Mr. Harvey also urged lawmakers to require physicians to carry higher levels of professional liability coverage. Many physicians have reduced the amount of coverage they carry because of the damage caps, he said.
Mr. Harvey told lawmakers he would like to see the caps eliminated. "I understand the political reality of that, but if we are going to live in a world of caps, let's quit creating statutory conflicts of interest among families by making it a per-defendant cap in a death case. Let's make the cap adjust to the consumer price index. Let's make the caps a legitimate number that people can afford to get a lawyer and pursue their claims, and let's require health care providers to carry enough coverage to compensate for these limited losses that these people are able to sue for," he said.
In addition to these changes, trial lawyers likely will push several other changes in the 2003 reforms. In 2007, trial lawyers attempted to repeal a provision of House Bill 4 that limited recovery for hospital bills, physician fees, or other expenses to the amount paid or incurred. Under HB 3281, for example, a plaintiff could have sued a hospital for the full amount the hospital billed rather than the discounted charge actually paid by the plaintiff's health plan. TAPA believes trial lawyers will file that bill again in 2009.
Physicians also believe trial lawyers also will attempt to weaken a provision of HB 4 that requires a higher burden of proof in emergency room cases. Under that provision, plaintiffs must prove that negligence was "willful and wanton."
A bill filed in 2007 by Sen. Rodney Ellis (D-Houston) aimed to reduce the burden of proof in emergency medical care cases from "willful and wanton" to "simple negligence with a clear and convincing standard of proof."
TMA coordinated efforts among member physicians, prompting them to meet with local government officials and legislators to send a message that such a change would adversely affect patient access to emergency medical services. With help from TAPA and THA, the campaign proved successful, and the bill never made it to the Senate floor.
Other anticipated attacks include modifying the expert witness standard that requires such witnesses to practice in the same specialty area as a defendant physician, decreasing the amount of information plaintiffs must provide in expert reports, and eliminating a physician's right to appeal a challenge to such reports while the underlying suit is still pending.
Dr. Marcus says it is vital for Texas patients that physicians defeat these attacks on HB 4. "The number of physicians applying for a medical license in Texas has markedly increased, and the distribution of critical specialists in areas that were previously underserved has also dramatically improved."
Edinburg internist Linda Villarreal, MD, has seen the impact of HB 4 firsthand. Before the reforms passed, Dr. Villarreal says her patients had little access to some specialties, such as neurosurgery. Since 2003, three neurosurgeons have set up practices in the area.
"As a primary care physician, it certainly gives me a comfort level to have access to these subspecialists," she said. "It makes me much more comfortable to keep my practice here."
While the tort reforms have been a success, Dr. Marcus says physicians must continue to communicate that message if they want to maintain the gains they have achieved.
"As long as health care professionals can get their case to the legislators and to the public, we ought to prevail because the truth is on our side," he said. "And the promises have been kept. Legislators would want to continue to see more and more doctors coming to Texas and not a return to the bad old days."
Gov. Rick Perry has been a staunch advocate of tort reform. His aides say he remains on the doctors' side.
"Our guess is that every session somebody is going to try to introduce legislation that attempts to weaken those tort reforms, and every legislative session the governor is going to fight hard to keep the tort reform measures passed intact, if not strengthen them," said Perry spokesperson Allison Castle. "We've brought doctors back to Texas and areas of the state that they had left. We've got OB/Gyns in areas of the Valley that we didn't have before. Tort reform has made a huge impact here in Texas. The governor will fight any attempts to weaken those reforms."
Lt. Gov. David Dewhurst also says Texas needs to stay the course on tort reform.
"In January 2003, when I was sworn in as lieutenant governor, doctors were exiting the state of Texas due to skyrocketing medical malpractice rates. Since the Senate and House passed HB 4, doctors and hospitals have seen medical malpractice rates come down, in some cases, as much as 45 percent," he said. "It's no coincidence that our legislation stopped an exodus of doctors from Texas, and today we have more than 3,000 doctors wanting certification to practice in Texas. That's good for all Texans because it means more access to quality, affordable medical care, and now is not the time to change course on this critical tort reform."
Meanwhile, the trial lawyers are making a strong push to defeat pro-tort reform lawmakers in this year's elections. Dr. Marcus says that means it is imperative that physicians get involved in the political process.
"That's why contributions to TEXPAC are so important," he said.
He is confident that physicians can prevail in the tort reform wars if they remain politically active.
"With the support of doctors across Texas, we will prevail and not just this session but in every session from now on," he said. "Any erosion of any kind is the slippery slope."
Dr. Villarreal says it is literally a matter of life or death that physicians maintain their vigilance. "It's life or death for our livelihood and life or death for our patients who may not have access to health care if this gets reversed."
Ken Ortolon can be reached by telephone at (800) 880-1300, ext. 1392, or (512) 370-1392; by fax at (512) 370-1629; or by e-mail at Ken Ortolon .
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