The panelists noted that there could also be negative effects from the health care reform law, including the short term potential for the primary care network to be overburdened.
NEW YORK—The Health Care Reform law, signed by President Barrack Obama on March 23, 2010, could potentially have a positive effect on medical malpractice liability, actuaries were told at the Casualty Actuarial Society (CAS) Seminar on Reinsurance.
ago, hospital systems became more fo-
cused on loss prevention, Mize said.
“They looked at where their most ex-
pensive claims were occurring and
Physicians could become more lev-
eraged and increase their reliance on
physician assistants or nurse practi-
tioners. This burden may cause lesser
trained care providers to look at more
complicated health issues.
John Mize, consulting actuary, Towers Watson, noted that some provisions of the law emphasize value-based compensation programs. “Hospitals will get penalized if they have a larger proportion of readmissions than others. Hospitals are already focused on loss prevention, and hopefully through this process there will be even more motivation for hospitals to provide better care, which will result in more favorable outcomes and fewer claims,” he said.
“Plaintiff attorneys have
also become more
selective about their cases
due to the high cost of
litigation. This has helped
drive claims frequency
and costs down.”
John Mize
Speed Dating for Doctors
“While there’s a plan to educate
and train physicians, it’s not broad
enough,” said Fields. “The number of
patients who are seen in a given day
creates a strain. For example, if pa-
tients are seeing their doctor for 15-
20 minutes now, that might drop to 5
or 10 minutes. If that happens, the er-
ror rates will go up.”
created loss prevention activities to re-
duce risks in those specific areas.”
The Future is Murky Paul Fields, vice president of underwriting, Odyssey Re, added that hospitals will need more stringent quality control measures. “How do hospitals integrate this into their system? What is the cost differential? What is the impact—better quality of care, better support services? It’s not clear, but there is going to be much more focus on primary care.”
Picky about Who to Sue “Plaintiff attorneys have also become more selective about their cases due to the high cost of litigation. This has helped drive claims frequency and costs down,” Mize explained.
Fields added that there is also the potential to increase the administrative burden on physicians. “This could put more pressure on physicians to hire people to handle administrative duties, or if they handle the duties themselves, it will take away more time from patients.
Some of these favorable factors, however, may not hold over time. If medical malpractice is viewed as more fertile ground for plaintiff attorneys in the future, they may accept more cases, which would drive up claims frequency.
According to Fields, accountable care coordination programs that are jointly managed by hospitals and physicians have the potential to create a smoother continuum of care. “As the programs are further developed, we’ll learn more about the benefits. Perhaps it could reduce or eliminate some of the gaps in the current structure,” he said.
“There also could be pressure to try to
reduce costs, and testing could be an
area that is cut back. Testing has im-
proved the physician’s diagnosis, so
if testing is cut back, there could be
an increase in cases of misdiagnosis
or failed diagnosis. That has the po-
tential to create bad outcomes and in-
crease claims.”
Likewise, jury attitudes may change
over time and become less favorable
to healthcare providers. However, the
loss prevention activities that hospitals
have put in place should have a lasting
impact, assuming hospitals are persis-
tent in those efforts.
Salmon Moderates Kelly A. Salmon, an actuarial associate for Guy Carpenter, moderated the panel session, which was held at the CAS Seminar on Reinsurance in New York City in May 2010.
In addition to enhanced hospital loss prevention activities, other potential favorable factors have improved medical malpractice loss experience in recent years.
When the cost of medical malpractice
increased dramatically about 10 years
Looking at the potential of tort re-
form, Mize said that his sense is that
the most effective tort reform seems
to be passed when constituents feel
that access to care is at risk. If a federal
tort reform law pre-empted state laws,
some states that currently have strong
tort reform may see costs increase as a
result of the change.
The Casualty Actuarial Society fulfills its mission to advance actuarial science through a focus on research and education. Among its 5,200 members are experts in property-casualty insurance, reinsurance, finance, risk management, and enterprise risk management.
References:
Archives