WHY TEXAS LAWYERS ARE REFUSING TO TAKE ON MERITORIOUS HEALTHCARE NEGLIGENCE CASES
Every citizen is a much higher risk of being seriously injured or harmed by negligent healthcare than by terrorists or crime. Right now, every citizen is picking up the tab for damages caused by negligent healthcare because Medicare, Medicaid, private insurance, Social Security, and school districts are paying for the damages. The parties who caused the damages through their negligent conduct are reaping benefits generously provided by republicans and are not required to be responsible as are individual automobile drivers, airlines, trucking companies, manufacturers, construction companies and the rest of the world. Why do healthcare providers have it so good?
In 2009, very few lawyers are willing to pursue a meritorious healthcare liability claim, and many victims have no remedy for injuries negligently inflicted on them by physicians, nurses, hospitals, and nursing homes. Many Texas Trial Lawyers are telling victims with meritorious cases they are not willing to accept employment on a contingent fee because of economic reasons. Many victims with meritorious cases cannot find redress in the Texas civil justice system.
In 2003, a Texas republican majority legislature passed sweeping changes to hundreds of years of common law and took away the right of Texans to have controversies in suits at common law where the value in controversy exceeded twenty dollars decided by a jury. The United States Constitution, Bill of Rights, states that “In suits at common law, where the value in controversy shall exceed twenty dollars, the right of trial by jury shall be preserved, and no fact tried by a jury shall be otherwise reexamined in any court of the United States, then according to the rules of the common law.” That legislature decided, quite arbitrarily, that in healthcare liability claims in Texas, that a jury determination of such damages would be limited to $250,000.00 for non-economic damages. Texas still trusts juries to impose the death penalty, occasionally upon the innocent. However, Texas does not trust juries with the money of insurance carriers, hospitals, and surgeons.
Prior to 2003, if a victim of hospital malpractice was a 30-year-old bread winner for a family, and the victim was rendered quadriplegic on account of the malpractice, a jury could assess the fair and reasonable compensation for a lifetime of physical pain, mental anguish, physical impairment, loss of consortium of his family. If a jury determined such fair and reasonable compensation was $2,000,000.00, a judgment could be entered for the wrongdoer to pay $2,000,000 plus medical expenses and loss of earning capacity. Since 2003, the $2,000,000 would be reduced to $250,000.00.
The so called “tort-reformers” argue that taking away the citizens right to a trial by jury was justified to keep hospitals from closing and physicians from quitting the practice or moving to another state. They argue that the healthcare industry was practicing defensive medicine and that was running up the cost of healthcare.
The real effect of this legislation is that lawyers are not able to take meritorious cases because of the limitations on damages. Many victims of healthcare malpractice have damages for out-of-pocket medical expenses, and a lot of physical pain, mental anguish, disfigurement, physical impairment, and loss of consortium. If the maximum recovery is going to be $250,000.00 the insurance carriers for the healthcare provider knows a worst-case scenario jury verdict would mean they would only have to pay $250,000.00. Faced with such a limit, such carriers rarely ever even offer to pay the $250,000.
The victim’s lawyer will be required to retain experts in that field of medicine involved, produce reports that clearly articulate what the standard of care is, clearly articulate what conduct on the part of the healthcare provider was below such standard of care, and further clearly articulate how such deviant healthcare caused the complained of injury. Typical expenses to get all the medical and billing records and any relevant imaging film to such an expert, and get the expert review and report ranges from $3,000 to $10,000.
The victim’s lawyer will have to put the negligent healthcare providers on notice and allow them a minimum of 60 days to evaluate the situation before proceeding with a lawsuit. In most cases, in my experience, the insurance carrier for the negligent healthcare provider does not even respond.
The next step for the victim’s lawyer is to file suit. The expert report(s) must be served on the negligent healthcare provider(s) within 120 days of the date the suit is filed. Once the negligent healthcare providers file their answers and appear, they almost 100% of the time file a challenge to the expert report served on them by the victim’s lawyer. The appellate court system of Texas, since 2003 is overrun with appeals that reports are insufficient or not. If a report is determined to be insufficient, then the case is dismissed with prejudice. There is no other damage claim (auto accidents, product liability, premise liability, workplace liability, aviation, you name it) where a case can be dismissed with prejudice on account of technicalities with expert reports. What is more, the judges who are determining such reports are deficient are grading the reports of highly trained medical experts and such judges do not have medical training.
If the victim survives the almost certain challenge to the expert report, the case proceeds like other cases with each party exchanging information through discovery. Discovery has gotten very expensive on account that negligent healthcare defendants lawyers get paid by the hour. It has been my experience that many of those lawyers run their meters hard and long just because they can and because the insurance company paying their fees want to make it expensive for victims to pursue a claim. Once discovery is complete, and all the parties are assured they know all the facts and what all the experts will say at a trial, attempts at settlement take place. That is usually a mediation. By the time mediation comes about, the victim’s lawyer will have incurred and paid out between $25,000 and $75,000 in expenses for expert witness fees, deposition costs, travel expenses, and acquiring records.
You don’t have to be a rocket scientist to understand that if one has to spend between $25,000 and $75,000 in out-of-pocket expenses and 100 to 200 hours of lawyer time and 100 to 200 hours of support staff time to make a gross recovery of $250,000, one cannot stay in business very long. To quote my mentor, “if someone is doing a lot of that, I will show you a pocket of poverty.”
That is the main reason so many Texas Trial Lawyers are just saying no to victims with meritorious cases.
What is more it the issue of subrogation that has also changed in Texas. Entities such as Medicare, Medicaid, and private insurance companies who pay the medical bills that were necessitated to treat the injuries caused by malpractice now have an absolute right to be reimbursed for what they paid right off the top of any recovery the victim gets by suing the negligent healthcare provider. That principle is known as subrogation. The entity entitled to subrogation is known as the subrogee.
Prior to 2006, the “Made Whole Doctrine” existed. That meant that the subrogee could not collect on its subrogation until the victim was made whole by the settlement. The all republican Texas Supreme Court threw out the “Made Whole Doctrine.” Now, it does not matter what the victim recovers, the subrogee gets first money out of the settlement. In practice the subrogee realizes that if the victim does not settle, that the subrogee may get nothing. Most subrogees will reduce their subrogation amount if it is necessary to get something. However, a chilling effect on victim’s rights exists.
Another gut shot to victims is another part of the 2003 legislation. On the issue of recovering medical expenses that are the usual and customary charges for medical treatment that was reasonable and necessary to treat the injuries caused by the negligent healthcare, prior to 2003 the victim could make a recovery of all such charges. For example, if the total of the charges was $125,000.00, the victim could get a jury finding of $125,000 and a judgment for the full $125,000. The 2003 legislation limits the recovery of medical expenses to those that were paid or incurred. Here is how that works. Take the $125,000 that are the totals on all the billing statements. If Medicare, Medicaid, or a private insurance carrier paid out a total of $40,000.00 and as a result of such payments, the victim is not liable for the balance, then the maximum the victim can recover is $40,000.00. If that sound fair, then consider that the tradition in Texas has always been for injury victims to retain lawyers on a contingent fee, meaning that when all is said and done, the victim pays his/her lawyer a percentage of the amount recovered. Before “paid or incurred,” there was cushion for paying the lawyer and making the victim whole. Now such cushion does not exist.
Another downside for victims is many physicians in Texas only carry $200,000 in liability insurance and many hospitals in Texas allow surgeons performing high-risk procedures to only carry $200,000.00 in liability insurance. Consider the case of a neurosurgeon who has staff privileges in a large general hospital, and who is privileged to perform major high risk spinal surgical procedures. Consider the case of such a surgeon who does a major high risk cervical spinal procedure without proper indications (he should not be doing the procedure in the first place because it is not warranted). Consider the neurosurgeon falsifies the indications. Consider the procedure has serious complications and causes the victim to suffer paralysis. The victim is not going to be able to get a dime from the hospital that let the neurosurgeon have the privileges that were used to commit the malpractice. The victim is never going to collect more than $200,000 from the negligent neurosurgeon. The victim has over $350,000 in medical expenses alone, not counting physical pain, mental anguish, and physical impairment. Most states mandate that surgeons carry a minimum amount of insurance, such as $1,000,000 to $3,000,000.
The Texas Supreme Court has dealt another harsh blow to victims of healthcare malpractice. In Texas, today, if a hospital knowingly lets surgeons who are known to be incompetent or who are impaired due to drug and alcohol abuse, have surgical privileges, and such surgeon negligently injures a patient on account of such incompetence or impairment, the hospital has no liability. If a trucking company, a railroad, an airline, a factory, or other non-healthcare entity knowingly hires an incompetent or impaired person who due to such incompetence or impairment injures innocent victims, then such entity does not have the protection that hospitals and clinics have.
I have no ax to grind with healthcare providers. I represent many physicians and defend them when they did nothing wrong. My experience with physicians and nurses is that they deeply care about delivering quality care. They are passionate about what they do. They push and strive for excellence everywhere. There is always the ten percent who do not care about anything but their own pocket book and their own pleasure. The same is true in the legal profession.
My bottom line is this. Healthcare negligence kills over 100,000 per year and injures more. Society picks up the tab through Medicare, Medicaid, private insurance, through public education programs to deal with profoundly injured children. None of the victims are going completely without. Everyone who pays any taxes is picking up the tab. By making the negligent healthcare provider pick up the tab, you make the ones who can best protect the innocent responsible for their bad conduct.
Negligent Healthcare causes much more harm to society than ten 9-11’s. Every American is at much greater risk of being harmed by negligent healthcare than by a crime or terrorist attack. Such risk is real and it affects everyone. The best way to reduce the risk of damages caused by negligent healthcare is to make negligent healthcare providers be responsible for the damage caused.