Skip to comments.Why Tort Reform?
Posted on 11/20/2004 6:52:04 AM PST by pickrell
Interview with a housewife and mother. Name withheld to protect the innocent. (In this case me, since she'll "zero my blood pressure" if I print it...)
***** So you used to be an OB/GYN? But no longer?
"Yes. Now I raise my children, instead of delivering others. The choice was made for me...a function of cost-benefit reality today."
***** For the Freepers, then, can I ask you to explain health care costs, from a point of view inside the profession?
"Well, I can try show you what I ran into, at least, in the years in which I could afford to practice.
After borrowing the money necessary to complete medical school, and survive the following internship period, I further arranged a loan to hang out my shingle on a modest office. Some work was done there; more was done at the local hospital.
Until my practice could expand, I handled every function myself. For anyone who starts his own small business- and make no mistake, medical practice is a business, incurring all of the attendant expenses, and more, that every other small business faces- the regulations and paperwork are the part of the equation that the 'customer', (in this profession the 'patient'), never sees.
My practice, like the average OB-Gyn, generated roughly $ 350,000.00 in billings on a given year. This stems from what is considered the full-time average for this specialty of 120 hours per week. Yes, you heard right! It is a profession that can absorb every waking hour of your life, excepting the times where you vacation hard to remind yourself that you used to have a family, and a life, too.
But note the word 'billings'. At least 30% of those billings, on average, go unpaid, and are later found to be uncollectable. That's $105,000.00. This figure takes into account contractual writeoffs. If the practictioner puts aside strict financial sense, and also accepts Medicaid patients, the additional amount unpaid neatly cancels out the additional Medicaid receipts taken in. It is effectively charity.
This then leaves total receipts of $245,000.00, which the IRS charges to me as gross taxable income. But before I run out and buy that cabin cruiser...I have a few disbursements to make...
Between $ 100,000.00 and $ 150,000.00 comes right off of the top, paid directly to the malpractice lawyers. This is for the most reasonably-priced malpractice insurance. It's a form of legalized extortion. I was fortunate to operate in Michigan. In some other states, from what colleagues tell me whenever I complain, malpractice insurance can be double this number! In neighboring Ohio, it may soon be unobtainable at any price! Understand- this is protection money being paid. True, no goons now come around in pin-striped suits-...they have refined their techniques over the years.
If you pay your defendant lawyer firm, you get to continue to practice. If you don't pay, the defendant lawyer's buddies, known as the plaintiff's lawyers, will take everything that you have. Incorporation serves as no shield, since collateral for your business loans exposed your house and all of your belongings to attachment per judgement.
Not only that, but if you don't pay, you will be unable to practice in any hospital; because the hospital knows, (though it isn't spoken of publically for fear of retaliation), that the plaintiff lawyers care nothing about justice or truth. Their clients are merely convenient opportunities to empty the deepest pockets of anyone who can however remotely be tied to a case.
And as long as that 400th patient doesn't get the outcome they wanted, and the lawyer accesses them to have a usable "good victim look" on the witness stand, the harvest goes on. Seven years ago, I paid $ 50,000.00 in malpractice premiums. In the subsequent years, depending on the "harvestability" of the medical specialty, the premiums have risen between 300 and 400 percent. In fact, the returns are now SO lucrative that they can fund a race for Vice-President, with plenty left over for townhouses in Malibu, and the newest executive model private jets."
***** But surely, this hasn't all come because of some sudden, mysterious deterioration in the medical profession's skills or knowledge? The body of knowledge in your field grows every year, and your skills and techniques improve with time, technology and experience, we assume?
"...And new drugs and techniques can now reverse some of the self-inflicted damage that young mothers inflict upon themselves and their unborn children. Premature babies can now survive at ever earlier delivery times that would have meant certain death years ago. But even with all of our accumulated knowledge, we can't banish entirely the fact that life happens."
***** So, it could be said that this rising cost has come about through improvements in the techniques of attorneys who can afford to pay professional witnesses for junk science, counting on the ever decreasing education and sophistication levels of carefully chosen juries. In a word, the attorneys have more time on their hands than you do. But I won't interrupt again.
"Well, this then, leaves me with roughly $ 100,000.00 of GIAPP. (Gross income, after paying protection.) Now, out of that number comes office overhead, which can be somewhere around 30%-40% of the remaining $ 100,000.00. No, the electricity, postage, worker's comp, telephone, etc. are NOT free to doctors!
That leaves me with $ 60,000.00 to jet to Paris-...But wait! Now comes my income tax, at the 30% bracket for the Feds, with additional owed to the city and state. With the $ 40,000.00 left, I forego the tickets to Europe, and instead canoe to Ann Arbor.
But I'm not done yet. I have several children, and I'm in a profession that demands that I be ready to be called out at any minute, day or night. It is illegal for me to leave my children alone, so I pay out $ 25,000.00 per year for the nanny. That is the lowest rate available for full time, live in childcare.
I'm now looking at my remaining...$ 15,000.00 per year. For the first few years, I accepted the losses, and hoped that my costs would go down, or that increasing time spent in the practice would somehow increase my revenues. (I also hoped that a cure would be found for Michael Moore. Not for any specific disease- but just for his being a waste of connective tissue...). Hopes crash under the tread of reality.
OK. Figure this out. I, as a female ob-gyn work 120 hours per week, go through the emotional stress of leaving my husband and kids anytime, anyplace, without any warning, and have no choice but to leave the running of my house to some other woman. I get to carry the emotional and physical concerns of my patients to heart, and am further rewarded to know that everything I say, at any time, to any patient, can and will be cheerfully used against me in a court of law. I have absolutely no time to look after my own physical needs, and then find out that my real take home pay (after calculating and paying out all of the expenses needed to keep me employed) is less than I can make hanging drywall..."
***** Mrs. -------, I thank you for taking the time to explain to all of the Freepers just how this career field works. To get the other side of the story, I spoke with an attorney experienced in tort law.
***** So, does the solicitor have an answer to the complaints of the baby doctor? (This female attorney practices in Ohio).
"In fact, we have. Most of the losses which drove up insurance rates in the last 8 years weren't due to amounts necessary to cover plaintiff recoveries. The fact is that the insurance industries lost massive amounts of money in the stock market where they count on multiplying their profits by investing the premiums that they collect. When the market tanked in the late 90's, they were hurt. But for quite a few years now, the market has recovered nicely, and their original losses were made good. The real subject for a Senate investigation should be the fact that premiums haven't gone back down since then! They are now making an obscene amount of profit; far above what they need to cover court awards."
***** I am left to peruse a few facts about Ohio. The number of companies offering insurance to physicians here has dropped from 20 to 5 in the last few years. And several of those five have either decided to drop out or are considering dropping out of the market here in the near term. They have created a sense of panic among the politicos here.
In August, Governor Taft instructed the Ohio Department of Insurance to create a program to help Ohio medical professionals who are experiencing difficulty in obtaining medical malpractice liability insurance. The Medical Coverage Assistance Program (MCAP) is the Departments response to the Governors charge. It is a temporary, voluntary program operating under the supervision of the Superintendent of Insurance created to: 1..Promote stability in the Ohio medical malpractice liability insurance market 2..Assist medical providers in obtaining medical malpractice liability insurance coverage when coverage is difficult to find in the market.
Ohio also recently enacted bills 215 and 281, which will mandate review by medical boards before cases can be brought to court and which cap damage awards by courts.
I do know this...in OUR small electronics business, if an endeavor proves lucrative to us, we seldom exclaim "Darn! This is generating an "obscene amount of profit" for us! We need to close this operation down, and find an new area where we can lose money like drunken sailors!" But then, that's just us...
Like any Freeper, I can only examine what facts I come across. The American Medical Association now warns that 19 states are in crisis due to the malpractice premium problem. The questions I have for the Freeper lurkers, here, are:
Why is it that when ObGyns are surveyed, over 80% would not recommend this specialty to young medical students considering obstetrics and gynecology?
Why have 1 out of 6 ObGyns retired in the last 6 years?
Why is it becoming impossible for new mothers to find a baby doc?
Is tort reform necessary, and if so, how will John Edwards maintain his lifestyle? Will his hair suffer?
No one seems to know.
..and if so, how will John Edwards maintain his lifestyle?"
He doesn't deserve the lifestyle, so shouldn't BE allowed to maintain it.
"Will his hair suffer?"
One hopes that he soon resembles Lex Luthor.
we need that cia operative that tried to de-hair Castro back in the 60's --- give him another chance to redeem his errors and earn the gratitude of his (her?) country.
Thank you. That was excellent.
Loser pays. Make all or most of the frivolous suits go away. Time to start excising the lesions surgically in order to expurgate all of the John Edwards' of this nation and all of his ambulance chasing buddies.
Great article. Tort reform is needed now. However, unless we vote out the lawyers from among the 'lawmakers', that will prove to be difficult.
Situations like Ohio and West Virginia will force the voters to think about it. It could be one of the defining issues in the next few elections.
Keep the faith.
We have to stop electing lawyers.
Lawyers are proof that homosexual relationships beget children.
LOSER PAYS, LOSER PAYS, LOSER PAYS. TOP THE GRAVY TRAIN.
"One hopes that he soon resembles Lex Luthor..."
That's cold, Warthog...And funny!