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HealthBeat

Healthbeat: Malpractice panels haven’t eased process so far

New Hampshire’s process for screening medical malpractice cases before trial is slow and expensive, and usage is low and falling, statistics show.

Nevertheless, a legislative oversight committee has recommended leaving the program in place rather than making changes, saying that, at the very least, it is doing no harm.

That hasn’t ended the debate over whether the panels are good or bad for patients and doctors, or slowed down legislative attempts to reform the process.

“The jury is still out on whether the panels in their current form are achieving their goals,” said Chief Justice Tina Nadeau, head of the superior courts.

Opponents disagree: “They’re taking too long, they’re too expensive and as a result, the parties to a lawsuit are not even using them anymore,” said David Gottesman, a Nashua attorney who represents plaintiffs.

The panel system was created in 2005 with an eye to discouraging claims without merit and resolving all cases faster than trials, ideally lowering the costs to malpractice insurers.

Containing those costs, officials hoped, would keep malpractice insurance rates down, and potentially encourage more doctors in expensive-to-insure specialties to move to the state.

Seventeen other states have similar panels; some are a mandatory part of the process, while New Hampshire’s screening panel may be waived if both parties agree.

The panels, which consist of a retired judge, a lawyer and a physician or two, spend about a day reviewing the cases instead of the indeterminate length of a trial.

Both sides in a panel hearing are given wide latitude for presenting their case and don’t have to abide by the same rules of evidence that govern court hearings and trials.

After hearing the facts of the case, each member votes in favor of either the plaintiff or the doctor. The decision is not binding and never prohibits a case from going to trial, but the idea is that a unanimous decision either way will encourage the sides to settle.

In a report to the Medical Malpractice Screening Panel Oversight Committee before members issued their report in November, the state Insurance Department showed that the panels are being used less and less frequently and haven’t significantly affected costs for insurers.

Contrary to the hopes at the panels’ inception, New Hampshire medical malpractice insurance rates were some of the fastest increasing in the country in the last three years, according to Assistant Actuary Sally MacFadden.

But it’s impossible to say why or pinpoint if the panels are having any effect because “there are so many moving pieces,” MacFadden said.

“From the standpoint of a regulator, the market is functioning within normal bounds. . . . As a regulator, I’d think there was a problem if the rate changes were runaway higher here, if the insurers couldn’t keep up with the rates or if doctors were unable to find coverage,” she said.

The insurance department also found that cases that do go through the panel process take longer to reach resolution, as lawyers for both sides prepare as if for a trial.

“The process is just more expensive and time-consuming than anybody, even the people advocating for this, ever conceived of it being,” Gottesman said. “It is a terrible exercise in wasted time for everyone involved.”

Costs for plaintiffs weren’t analyzed by the oversight committee, but doctors and other defendants do face some higher costs in cases that go through the panel system, according to the Insurance Department data. Claim expenses (the cost of defending the case) for those cases are 32 percent higher than cases where the panel was waived.

Payments to plaintiffs are 23 percent lower in cases that use the panel system than in those that don’t, however, bringing the average total cost down to 12 percent lower for cases that go through the panel.

Since the process can be waived if both parties agree, fewer cases have used the panel process every year, despite support from the New Hampshire Medical Society.

At its peak, in 2008, the panel heard 28 of the 54 malpractice cases filed in the state. Last year, it heard two of the 107 filed cases.

Scott Colby, executive director of the New Hampshire Medical Society, pointed to a 2012 Supreme Court case related to the panels and related uncertainty about the panels’ future as a reason for declining use.

“That did cause, we believe, a disruptive period,” he said.

In general, the medical society supports the panel system and opposes two bills working their way through the Legislature this year that would change the system.

One would revise the state’s early offer law – another mechanism intended to encourage resolution of malpractice cases short of trial – to include lost earning capacity and other economic losses in the calculation for a potential settlement. The House Judiciary Committee recommended passing it, and it’s due for a vote by the full House on Wednesday.

The other, changing the rules of testimony for the panels, has already been approved in the House and will go to the full Senate next month. By limiting the panel to hearing offers of proof, or written testimony from experts, sponsors such as Sen. Betty Lasky of Nashua hope to cut down the time and expense of the panel process.

“It’s two trials. It’s what many of us expected from the beginning,” said Lasky, who was also one of the authors of the oversight committee minority report.

“The cost of litigation is very high and it takes away, in my mind, from equal justice for all,” she said.

The bill concerns the medical society, which is “very concerned that offers of proof will render the system ineffective,” Colby said. “You can’t cross-examine written testimony.”

At the same time they are proceeding either through the panel process or preparing for trial, both sides in civil cases are mandated by a different state law to attend mediation.

That wasn’t the case when the screening panels were created. The introduction of that element has further complicated malpractice cases – and efforts to analyze where the problems in the process lie.

Any major changes will likely be far down the line, Nadeau said.

The judicial branch is looking for ways to analyze the different effects of mediation and the panels, “but we’re pretty much trying to stay 99 percent focused on e-court,” the Judicial Branch’s project to automate New Hampshire court case processing, she said.

The first phase of that project is due to start in the summer or fall. Intense data analysis of the malpractice screening panels will likely take a backseat until after that, she said.

(Sarah Palermo can be reached at 369-3322 or spalermo@cmonitor.com or on Twitter @SPalermoNews.)

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