Coming of Age: Celebrating 15 Years of Texas Tort Reform
By Joey Berlin Texas Medicine September 2018

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For many Texas physicians, the bad, pre-2003 memories may never go away. But those dark days have given way to a new Texas and a new reality.

Thousands of medical liability lawsuits — many dripping with frivolity — driving Texas physicians out in droves? They’ve been replaced with an era in which doctors are settling in Texas in record numbers, and specialists are filling voids in rural areas.

Two decades ago, physicians might call the Texas Medical Association in tears because they had lost their medical liability coverage and no one else would insure them. Now, insurance rates are at staggering lows, and dozens of companies are competing for the doctors’ business.

Physicians in Texas no longer face the same pressure to practice defensively — what emergency physician Justin Hensley, MD, calls “CYA-type medicine.” And it’s not nearly as likely a patient’s family member will take up arms in legal target practice, calling a Texas doctor to shake him or her down for cash to make an anticipated lawsuit “go away.”

The TMA-backed tort reforms that went into effect 15 years ago this month changed all that, and proponents say physicians and patients alike are in better shape because of it.

Seven years ago, because of tort reform, Dr. Hensley and his wife, pediatrician Katherine Hensley, MD, moved to Corpus Christi from North Carolina, a state where doctors were still ripe and constant liability targets. They quickly appreciated the saner liability environment in their new home, and today, Dr. Justin Hensley says his comfort level practicing in Texas may be even higher.

Last year, he became medical director for the City of Robstown Emergency Medical Service. In that role, he says, he’s realized how much easier it is to obtain liability coverage in Texas versus other states. As long as his medics are practicing their craft rationally and reasonably, he doesn’t have to worry about a frivolous lawsuit.

“It’s no longer just me; it’s the people that I supervise. They’re touching people every day,” said Dr. Hensley, president of the Nueces County Medical Society. “They’re seeing people in every situation, from car wreck to heart attack to children drowning, and things like that. Knowing that I’m protected from frivolity has made me really improve our protocols and our standards for pre-hospital medicine.”

More doctors, less worry

House Bill 4, the Medical Malpractice and Tort Reform Act of 2003, went into effect on Sept. 1 that year, thanks to advocacy by TMA, the Texas Alliance for Patient Access (TAPA), the Texas Medical Liability Trust (TMLT), and others. The same month, Texas voters approved Proposition 12, an amendment to the Texas Constitution that authorized the state legislature to cap noneconomic damages in health care liability cases. 

That vote protected the law’s $250,000 limit on noneconomic damages against individual physicians, and a total “stacked” noneconomic cap of $750,000 if health care institutions also are found liable. The law features other crucial protections, such as providing personal immunity to physicians working for governmental entities, including state medical schools. There is no cap on economic damages.

A decade and a half later, the law’s power shows up in both the numbers and the attitudes of physicians across the state. 

Perhaps the most poignant statistic: The Texas Medical Board has licensed record numbers of new physicians in the years post-tort reform. (See “A Flood of New Physicians,” page 18.) 

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Meanwhile, the number of physicians in Texas grew more than twice as fast as the state’s booming population growth between 2008 and 2017, according to the Department of State Health Services. Plus, more specialists are practicing in communities where they’re needed. (See “Rural Boon,” page 19.)

Austin internal medicine physician Howard Marcus, MD, chair of TAPA’s board, says the mindset of practicing medicine has changed, and statistics on medical liability lawsuits pre- and post-tort reform are strong indicators. (See “Plummeting Lawsuits,” page 20.)

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“Those frivolous lawsuits, by and large, are no longer occurring, because the system is now fair and balanced,” Dr. Marcus said. “The psychological result of that is it’s no longer a topic of endless conversation and worry and concern, and the top of everybody’s mind. 

“We understand that it’s our job to practice good medicine. We don’t need a lawyer to tell us that, or the threat or intimidation … of a lawsuit for that.”

Although she and her husband moved to Texas post-2003, Dr. Katherine Hensley is a good example of the typical Texas physician’s psyche post-tort reform. 

“I don’t feel afraid of litigation practicing here. I just don’t,” she said. “I try to practice responsible medicine, because I feel like malpractice is real, and when it really happens, those physicians need to be held accountable and the people they harm need to be compensated. I’m not saying that doctors should never be sued ever, by any means. But I don’t feel like someone is going to come after me every time they have a bad outcome.”

Overzealous intervening and test-ordering can have detrimental results for patients’ health, she says, noting recent research on the harms of ordering too many CT scans and overprescribing antibiotics.

“We act like, ‘Oh well, it’s not going to do them any harm, so let’s just go ahead and do it anyway, because we don’t want to miss something and get in trouble,’” Dr. Katherine Hensley said. “The reality is, we’re probably causing harm, so we need to get away from that. And I think tort reform has helped with that a lot. Because it allows us to make decisions based on what’s actually best for our patients, and not what’s going to keep us out of court.”

Corpus Christi neurosurgeon Mathew Alexander, MD, came to Texas in 2004 because of liability reform after completing his neurosurgery residency in Milwaukee. He says while tort reform has significantly improved the litigation climate over the years, there’s still a need to practice defensively, and access to neurosurgeons still has room for improvement.

 “In Victoria, there’s no neurosurgeon coverage. In Laredo, there’s sparse (coverage); one guy is half-retired,” he said. “If you have a head trauma or a head bleed, you’re probably not going to survive, because those critical 30 minutes to an hour, by the time you’re flighted out, you won’t survive that.”

Still, he views the reforms as important protections.

“It would kill any type of … neurosurgeon [practice] if tort reform is not in Texas. You would have to practice in academics, and then everybody’s kind of well-protected,” Dr. Alexander said. “But when we’re three hours’ or two hours’ flight to Houston or San Antonio, you endanger a lot of people.”

The  dark  ages 

Many of the younger guard of Texas physicians, and some who moved to Texas after 2003, may have no sense of what it was like in the bad old days. But McAllen gastroenterologist and TMA Immediate Past President Carlos J. Cardenas, MD, is one who will never forget what he calls the “lawsuit bonanza for the trial bar.”

In a TAPA-commissioned October 2017 report on the impact of tort reform on Texans’ health care access, researchers noted some areas of Texas saw 300 medical liability suits for every 100 physicians. While the vast majority of those suits were unsuccessful, the report says, defending them still cost physicians thousands of dollars and time away from their practice.

“Things had gotten to the point to where there were people that were hiring staff just to do nothing but copy records, because back then it was all Xerox machines. And you were getting a duces tecum [subpoena] almost every week to every other week,” Dr. Cardenas recalled. “If it was a patient you had seen, even if it wasn’t directly affecting you, you had to provide records because somebody else is being named in a liability claim.

“It was rampant, and things were worse, I think, in South Texas than they were in other parts of the state. We were kind of the canary in the coal mine, in that we were seeing it here before it became a problem across the rest of the state.”

The 2017 TAPA report noted that in the two years before the reforms, 14 of Texas’ 17 medical liability insurers disappeared. TMA General Counsel Donald “Rocky” Wilcox recalls being on the phone with physicians crying because their liability insurance carrier had dropped them, and they couldn’t find anyone else to insure them. And TAPA’s report notes the average hospital premium had spiked to $870,000 in 2003, more than double what it was in 2000, according to Texas Hospital Association figures.

For Dr. Cardenas, one of the most memorable signs of those times came from a would-be lawsuit he stopped. After the U.S. Food and Drug Administration pulled a heartburn drug off the market in 2000, a law firm representing one of Dr. Cardenas’ patients who had taken the drug warned him a suit was coming. Then, the patient’s brother called Dr. Cardenas. He recalls the brother essentially told him, “‘I can make it all go away for a certain amount of money.’

“I couldn’t believe my ears,” said Dr. Cardenas, who then noted the shakedown attempt in the patient’s chart. The law firm later stopped pursuing the case.

“That was the atmosphere. That’s kind of what was going on; it was open [season] on physicians down here,” Dr. Cardenas said. “We were having difficulty recruiting and retaining [doctors]. Medical liability coverage had basically gone away for some subspecialties.”

The lawsuits grew to epidemic proportions for Texas physicians, and the push for change began. On April 8, 2002, Dr. Cardenas and other Lower Rio Grande Valley physicians led a huge rally with patients and colleagues at the Hidalgo County Courthouse, one of several simultaneous rallies to protest insurance rates and the litigation-friendly climate. Doctors also rallied in Nueces County and elsewhere. Dr. Cardenas says at least 2,000 people joined forces at the Hidalgo County rally. 

“That rally was the spark that lit the fire that ultimately, I think, ended in tort reform,” he said. “It was a whole choir of folks that sang with one voice.”

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Fighting for preservation

Looking at data through 2016, the TAPA report also found that six of eight specialties saw an uptick in physicians per-capita in Texas post-reform. Emergency medicine had the highest increase in number of physicians at 120 percent. The number of pediatric surgeons per capita increased by nearly 50 percent.

“The evidence does suggest that meaningful reform had a significant impact on the supply of physicians per capita, and therefore had a significant favorable impact on the access that Texas residents have to the medical services they need,” said William G. Hamm, PhD, a California economics consultant who coauthored the TAPA report. California’s $250,000 cap on noneconomic damages, passed in 1975, served as the model for Texas’ tort reform.

Preserving that access is a continuing battle. Liability reform passed over the opposition of trial lawyers. Unsurprisingly, since 2003, plaintiff attorneys have fought the law both in the courthouse and at the Capitol. But efforts to weaken it legislatively have failed, and it has withstood numerous court challenges as well, even recently. (See “Protections Preserved,” July 2018 Texas Medicine, pages 34-35, www.texmed.org/protectionspreserved, and “The Right Standard?” October 2016 Texas Medicine, pages 47-51, www.texmed.com/rightstandard.)

Under HB 4 the damages cap in wrongful-death cases was tied to inflation, set at $500,000 in 1977 dollars. The legislature decided against indexing the noneconomic damages cap.

TMA lobbyist Darren Whitehurst says TMA would oppose any attempt to index that cap, as one failed bill attempted last session.

“We set it at a number that we felt was fair and provided some level of compensation but didn’t create a jackpot for the patient. There are still ways around that; if you can prove that the doctor knowingly or willingly provided bad care, then it provides additional ways to compensate those patients when harm occurs,” he said. “But you also have to weigh the individual against the ability for the population to access health care.”

 TMA always looks for opportunities to smooth out rough edges in the law, Mr. Whitehurst notes.

“We have conversations with the trial bar to see if there are areas [to improve]. We really utilize the attorneys with TMLT and some of the other medical liability carriers to identify if we have problems, and [if] the trial bar has similar types of problems, whether we can work on some language that makes sense.

“But bottom line is that tort reform has achieved what it was intended to achieve, which was to improve access to care for services in communities that weren’t being served in the past.”

Dr. Cardenas says the advocacy medicine used 15 years ago can be a blueprint for future initiatives that require a united front. He fondly remembers the work that brought to an end that once-dark era: “The empowerment of physicians to be able to do what we were told over and over again was impossible — that we’d have to rewrite the Constitution of Texas.

“What we ended up with was what’s been declared some of the best tort reform laws in the country,” he said. “It’s created the ability for us to recruit in our state and retain in our state the physicians and talent that we need in different areas in our state — both rural and urban.”

Tex Med. 2018;114(9):14-21
September 2018 Texas Medicine Contents
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Last Updated On

September 14, 2018

Joey Berlin

Associate Editor

(512) 370-1393
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Joey Berlin is associate editor of Texas Medicine. His previous work includes stints as a reporter and editor for various newspapers and publishing companies, and he’s covered everything from hard news to sports to workers’ compensation. Joey grew up in the Kansas City area and attended the University of Kansas. He lives in Austin.

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