Do Medical Malpractice Screening Panels Lower Costs or Save Time?

October 14, 2007

A two-year-old New Hampshire law that was supposed to speed up the processing of medical malpractice lawsuits has slowed things down instead.

The law created special screening panels designed to encourage people to settle or drop their suits. But in a report last month, Superior Court Chief Justice Robert Lynn said only eight of the 131 cases filed since the law was enacted had been screened. Another 34 of the cases were settled before they could be screened.

The law passed after a bitter fight between the medical community and trial lawyers. Modeled on a system in Maine, the panels were supposed to weed out weak or losing cases, encourage more people to settle and ultimately lower malpractice insurance rates.

The panel hearings were to be held within six months in most cases. Parallel court dockets were to be opened, but no trial could be held until after a screening hearing.

Critics say the results to date show the law adds to the time and cost of resolving malpractice cases, the exact opposite of what it is supposed to do. Supporters attribute the problems to “growing pains” and early court challenges that kept the system from starting on schedule.

The concept has gotten mixed reviews across the country.

New Hampshire and Maine are among perhaps 16 states with similar screening-panel laws, according to research by the American Medical Association.

But a 2003 study found the laws had been repealed or invalidated in roughly one-third of the 31 states that had adopted them. The study, by University of Pennsylvania Law School Professor Catherine Struve, was part of the Pew Charitable Trusts’s project on medical liability.

Struve concluded that procedural reform should focus instead on helping judges and juries assess scientific and medical questions. She said better screening alternatives existed, such as requiring plaintiffs to have an expert review the claim ahead of time and certify it had merit.

Earlier this year, Vermont considered adopting the Maine law, but the bill died in committee. The chairman of the Senate Judiciary Committee, Dick Sears, said the committee concluded the panels wouldn’t make much difference in malpractice rates since Vermont already has a mediation process.

In his Sept. 10 letter, Lynn agreed with supporters that more time is needed to make definitive conclusions about the New Hampshire law. But Lynn — who is in charge of the panels — said the time frame for hearings in the statute is impossible to meet.

“In short, insofar as one of the purposes of this legislation was to provide a ‘quick and easy’ method to resolving medical injury cases, I have reservations about whether the legislation will accomplish this goal,” he wrote.

Lynn attributed the backlog to reasons including too few volunteers to staff the three-member panels comprising a judge, a lawyer and a doctor. In a small state, the number of volunteers available is reduced by conflicts of interest, especially among medical specialists who know one another.

“I can’t order any of these people,” he told The Associated Press. “They can say, ‘Thank you, Bob, I’m busy that day.”‘

Lynn does not believe the addition of the panels will significantly delay trials in unresolved cases. A typical malpractice case takes 15 to 21 months to go to trial, he said. Panel hearings might take 15-18 months with the trial starting soon after.

“It’s going to be broken up differently,” he said. “The panel hearing will be held relatively close to the time the trial was held.”

All agree the biggest cause of delays is that both sides treat screening hearings like mini-trials.

“The panel hearing was supposed to be a look-see to determine if it is a frivolous lawsuit, but because it’s admitted to a jury if the finding is unanimous, no one wants to go halfway,” said state Sen. David Gottesman, a lawyer who opposed the law. “So it is two trials.”

Gottesman and other trial lawyers say that adds to their costs, which means they can’t afford to take on as many smaller claims on a contingency basis. Experts have to be paid once to testify at a panel hearing and again if the case goes to trial, he said.

The cost for a plaintiff’s medical experts is even higher because doctors living in the region are reluctant to testify, which means experts must be flown in from somewhere else, he said.

“I would think taking a case that has a value of $100,000 is a financial risk to the client and the plaintiff’s attorney,” said Gottesman, D-Nashua. “It’s probably going to cost $10,000 to $30,000 just for a small case on experts.”

“Our firm has turned down dozens of cases since the law took effect that we would have taken before,” said Manchester trial lawyer Kevin Dugan. “It does not make sense to spend $50,000 to win maybe $100,000.”

Supporters of the law include state medical societies and Medical Mutual Insurance Co. of Maine, which writes 65 percent of the malpractice insurance in Maine and about 25 percent to 30 percent in New Hampshire.

Dr. Terry Sheehan, Medical Mutual president and chief operating officer, insists Maine’s 20-year-old law has saved time and litigation costs in Maine.

Sheehan and Michael McCall, a senior vice president for the company, say statistics prove their point:

Higher litigation costs in New Hampshire: From 1994 through 2004, the year before the law took effect, 275 claims were filed and closed in New Hampshire with an average litigation expense of $31,350. During the same period, 999 cases were closed in Maine for an average cost of $18,920.

More cases go to trial in New Hampshire: From 1995 through 2004, 7.3 percent of cases filed went to trial compared with 2.8 percent in Maine.

Both sides say they prefer settling to costly, unpredictable trials.

Trial lawyers say roughly 80 percent of juries side with doctors. But doctors have an incentive to settle, too, McCall says.

McCall says there is always the chance a “runaway jury” will make an outsized award. Unlike settlements and panel hearings, which are confidential, jury awards get publicized, which tends to set the bar higher for others suing over injuries, McCall said.

Gordon Smith, executive vice president of the Maine Medical Society and one of the law’s strongest cheerleaders, says the trial lawyers are just balking at trying something different.

“I think it is a real success story for alternatives to court,” he said.

Leigh Saufley, chief justice of the Maine Supreme Judicial Court, isn’t so sure.

“It has, unfortunately, become a cumbersome process with unpredictable results that costs both plaintiffs and defendants money and time in a way that was not intended by the Legislature,” she wrote in a June opinion.

She and another justice urged Maine lawmakers to re-evaluate the system, pointing to a case that had gone through three trials in eight years because of split panel decisions. The dispute was over a jury award of $140,000 plus interest and costs.

Source: “Expertise in Medical Malpractice Litigation: Special Courts, Screening Panels, and Other Options” by Catherine T. Struve for the Pew Charitable Trust’s project on medical liability, 2003.

On the Net:

Dugan article:

AMA article:

Maine opinion:

N.H. law:

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