Judge-directed talks, patient-centeredness save millions in malpractice payments

As nationwide healthcare costs continue to rise, the industry is trying various ways to cut expenses associated with malpractice. For instance, New York's medically trained judges review and rule on medical liability cases within the legal framework, reports American Medical News. Thanks to the judge-directed negotiations and other risk management initiatives, the New York City Health and Hospitals Corp. (HHC) has saved $66 million in malpractice payments.

The average cost per medical liability case also dropped from $567,000 per case in 2003 to $428,000 in 2010. And since 2002, about 95 percent of HHC malpractice cases ended in settlements, which are often lower than jury awards.

In addition to saving costs, the strategy saves time. A medical liability case usually takes three years to resolve, whereas judge-led negotiations wrap up in about nine months, notes amednews.

Meanwhile, Stanford University's hospitals and clinics have taken a more transparent and patient-centered approach to cutting back on malpractice-related costs, saving more than $3 million annually with quick investigations and patient apologies/compensation, according to another amednews article today.

Under the program, the hospitals and clinics review adverse events within 90 days, providing no legal action has been taken. If the error is deemed preventable, the organization contacts the family, offers an apology, and discusses compensation, according to an Institute for Healthcare Improvement white paper released this month.

Hospitals should develop a clinical crisis management plan or risk losing trust and healing, while gaining the probability of lawsuits and challenges by the media, notes the whitepaper.

Between 1990 and 2002, 5,691 medical malpractice payments were made in the United States due to anesthesia-related malpractice, with an average payout of $338,190 per claim.

For more information:
- read the American Medical News article judge-led negotiation and quick investigations  
- check out the whitepaper