Transcript The Amazing Race

2008 Medical
Professional Liability
Symposium
The Amazing Race
Emerging Trends in Hospital Liability
Chicago, Illinois ~ March 11 & 12, 2008
Healthcare Facilities: The
Amazing Race??
• MODERATOR: Pamela K. Haughawout,
CPCU, ARM, RPLU, Senior Vice President,
Hilb Rogal & Hobbs
• Paul F. McKeon, MBA, Senior Vice President,
Transatlantic Reinsurance Company
• Donna Modestine, Esq., Shareholder,
Marshall Dennehey, Warner, Coleman & Goggin
• Joe P. Sullivan, Senior Vice President,
Healthcare Group Executive,
Zurich
4 Trends to Discuss
•
•
•
•
The Condition of the Insurance Market
Batch Issues
Never Events
Privacy Liability
Market Conditions
Riding the Roller
Coaster
Again!
We all know the market
is soft . . . But Why?
• Declining Frequency of Claims

Tort Reform
• Claims Severity
Loss Ratios for Medical
Malpractice Industry
Source: Bests Aggregates & Averages – Property/Casualty
120%
100%
80%
60%
1
40%
20%
0%
1997
1998
1999
2000
2001
CY LR
2002
2003
AY LR(SchP)
2004
2005
2006
National Practitioners Data Base
Nationwide
Frequency Analysis
Source: National Practitioners Data Bank public use file, June 30, 2006
3
2.5
2
1.5
3.1 3
2.9
2.9
2.6 2.6
2.4 2.3 2.4 2.4 2.5
2.2 2.2
2
1.9 1.8
1.6
1
0.5
0
19
91
19
92
19
93
19
94
19
95
19
96
19
97
19
98
19
99
20
00
20
01
20
02
20
03
20
04
20
05
20
06
20
07
Claims Per 100 Physicians
3.5
The Soft Market
More than Just Price
• Coverage Enhancements


Multi Year Deals
Coverage for Punitive Damages
• Bariatrics – What Happened to this
Issue?
• Risk Management Credits –
Promotional Hype or Legitimate
Underwriting Criterion?
Batch Issues
Batch/ Systemic Events
• Real or Imaginary?
• Brokers Pushing or UWs Offering?
• Excess layers are softest part of
market
Systemic Events
• Over 30 cases in our inventory with
some consistency:





Surgical Techniques
Sterilization (Hepatitis, Others)
Credentialing
Products
Laboratory techniques
…various others
Underwriting
Approaches
• Price, Attachment, Wording, or Luck?
• Wording 



Policy period(s)
Sole Judge
Split Retentions
…various others
Never Events
What are Never Events
• Payment reform enacted by Medicare
• No reimbursement for a condition that
never should have occurred during an
in-patient stay
8 Conditions
•
•
•
•
•
•
•
•
object left in surgery
air embolism
blood incompatibility
catheter associated UTI's
decubitus ulcers
vascular cath associated infections
surgical site infections
falls and trauma
3 More Conditions
• ventilator associated pneumonia
• staph. aureus septicemia
• deep vein thrombosis / pulmonary
embolism
3 criteria for deciding
what a Never Event Is
• High cost/high volume or both
• Assignment of a case to a diagnostic
related group with higher payment
because of secondary diagnosis
• Preventable through evidenced based
guidelines
NEVER EVENTS – NEW
STANDARD OF CARE???
• Will "never events" payment rules impact
Medical Malpractice Litigation
• Some Issues to Think About


Whether CMS regulatory violations constitute
negligence per se
Whether payments to a hospital under 5001(c)
would be admissible evidence to support
allegations of negligence
Do we still need medical experts now that CMS
has specified preventable error and blessed
specific preventable guideline?
• Private Insurers are following suit
DOES THIS CONSTITUTE
STRICT LIABILITY
In the news…
Staph infection threatens lives
Drug-resistant skin infections spreading fast
Over half of ER cases caused by potentially fatal
superbug, researchers say
CDC seeks to calm schools over ‘superbug’
Best way to fight the bacteria is simply to wash
your hands, officials say
Emergence of MRSA
• First recognized in
1968
• Early 1990’s accounted
for 20-25% of Staph
Aureus isolates
• 1999 - accounted for >
50% of Staph Aureus
isolates
• 2003 – accounted for
59.5% of Staph Aureus
isolates
Clostridium Difficile
Most common cause of hospital
acquired bacterial diarrhea
Often triggered by antibiotics
Common in hospitals and longterm care facilities
Yearly Clostridium difficile-related
mortality rates per million population,
United States, 1999–2004.
Source: Centers for Disease Control and Prevention Emerging Infectious Diseases
[online] 2007 Sep [cited 2007 Aug 17]. Available from Internet:
http://www.cdc.gov/eid/content/13/9/1417.htm
Norovirus
“Cruise ship” virus - New
strains have caused increased
hospital and LTC outbreaks
ED visits for acute
gastroenteritis increasing
(especially since October
2006)
Probably under-reported since
testing is inadequate
Norovirus
Estimated total cost for a 3 month Norovirus outbreak



clean-up expenses $96,000
staff sick leave and overtime $89,000
lost revenue from closing units and echo lab $418,000.
Total: $650,000
Sources of
Superbugs
#1 Healthcare Workers
• Patient gowns
• Stethoscopes
• The floor
• Door handles
• Bed linens
• Blood pressure cuffs
• Over-the-bed tables
• TV remote control
• Patient bed controls
Great Britain
•
No long-sleeve
white coats
No ties
No fake nails
No jewelry
•
No watches
•
•
•
Mandatory public reporting
Premier. Reducing the cost and impact of infectious disease. June 2007
Privacy Liability
HIPAA – HOW FAR HAVE
WE COME
• HIPAA AND HOW IT IS BEING ENFORCED, IF AT ALL



Office of Civil Rights
24,000 HIPAA privacy complaints
First HIPAA violation trial – Fernando Ferrer, Jr.
• HIPAA COMPLIANCE IS NOT SIMPLY A FEDERAL
REGULATORY MATTER



State Courts Look to HIPAA as Standard
Acosta v. Byrum 638 S.E.2d. 246 (N.C. Ct. App. 2006)
Bagent v. Blessing Care Corporation, 244 Ill.2d 154 (2007)
• HOW HOSPITAL'S ARE PROTECTING THEMSELVES
• IS HIPAA HERE TO STAY? (HIPSA) Kennedy/Leahy Bill - S.
1814
Discussion Points
• The issues surrounding interoperable electronic
health records is the biggest privacy and security
policy issue on the horizon
• Is it possible to balance the desire for electronic
medical records/personal health records with
appropriate privacy and security issues identified by
HIPAA?
• The debate on EMRs/PHRs likely will drive a new
evaluation of HIPAA
• Will the drive of Health Information Exchanges in
Hospitals and Health Systems open the door to
increased HIPAA based private litigation and what
hospitals can do to protect themselves?
Thanks for Inviting US