Global look at tort struggles offers glimpse of reform options

Physician leaders worldwide are grappling with medical liability problems, though most believe the United States has the worst situation.

By Damon Adams — Posted Oct. 10, 2005

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Ottawa -- Physicians around the world say the medical liability system is faltering in a number of countries, hobbled by high premiums in some places, hindered by ineffective approaches in others.

Medical leaders, attorneys and others traveled from as far as Australia, Kenya and South Africa to Canada last month to discuss the medical liability climate. They met in Ottawa for the Physician Insurers Assn. of America's International Section Conference to get a taste of what's happening in medical liability around the globe.

Many attendees said that while their countries may be struggling, they aren't as bad off as the United States. Experts said they are well aware of the liability crisis and rising premiums in the United States and noted that they are glad their nations are not experiencing a similar fate.

AMA Immediate Past President Donald J. Palmisano, MD, told the 220 conference attendees that the medical liability system in the United States fails physicians and patients. He said some states have made progress through reforms such as caps on noneconomic damages.

"But these are all defensive measures. They don't go to the root of the problem," said Dr. Palmisano, a general and vascular surgeon in New Orleans who also runs Intrepid Resources, a medical risk management and claims review company, and has a law degree.

At the two-day conference, medical liability experts agreed that various countries have their strengths, but no current system provides a perfect solution. And it's not practical to take one country's scheme and expect it to solve another country's problems.

"You cannot put Sweden's system into a crisis state in the United States," said David Waldron, a partner at SECOR Corp. Consulting, a Montreal-based firm that compiled a report on several medical liability systems in other countries.

But conference attendees said studying other countries may provide ideas that could be applied to their systems.

The situation in Canada has not reached the crisis level of the United States, but physicians are still concerned about the rising costs of liability protection and awards, according to Albert Julius Schumacher, MD, past president of the Canadian Medical Assn. Dr. Schumacher said the problem may be compounded by a physician shortage.

Not enough physicians are being trained to replace those who are retiring. The shortage leads to long waiting times, and doctors could be targeted for legal action if patients can't get treated in a timely manner, he said. Meanwhile, some doctors are avoiding high-risk procedures.

"There's increasing evidence of practicing defensive medicine," Dr. Schumacher said.

France's medical liability system, which has elements of fault and no-fault, is also seeing some strains.

Some insurers have left the market, causing premiums to go up and prompting some specialists to reduce their procedures or retire. The two streams of fault and no-fault and changes to rules for claim eligibility have created the uncertainty that has fueled the exit of insurers, consultants said.

Sweden's liability situation, however, is better than many countries, according to SECOR's report. In fact, it has been copied in Denmark, Finland and Norway. The key criterion for compensation is that a medical-related injury must have been avoidable.

One insurance company covers about 95% of the liability protection market in Sweden, SECOR said. Compensation for injuries ranges from about $1,200 to $980,000, with most cases averaging less than $2,400. Although payments in Sweden are low relative to other countries, Sweden's non-litigious culture and comprehensive social net may make it difficult to duplicate this system in the United States, experts said.

"We have an administrative procedure and we don't go to court as much. This would be one explanation why our costs are not higher," said Kaj Essinger, CEO of the County Councils and Regions Mutual Insurance Co. in Sweden. "This system doesn't worry so much about putting blame on someone."

In New Zealand, doctors are also experiencing fewer problems than doctors are in the United States. Patients who experience a medical error may apply for compensation through the Accident Compensation Corp., a national insurance program that provides personal injury coverage to New Zealand's residents and visitors. Because of the program, people do not have the right to sue for injury, except for exemplary damages.

For every 100 claims filed, 60 are rejected, the SECOR report said. Of the 40 approved, 15% are found to be the result of medical errors and 85% resulted from medical mishaps that caused a "rare and severe" injury, said Peter Robinson, MD, medical legal advisor of the Medical Protection Society in New Zealand.

Payments to patients are low, averaging between $2,000 and $5,000.

Lessons learned

Mediator and former judge George Adams of Canada said growing research shows that ineffective communication is the largest factor in producing patient litigation following a medical error.

He said apologizing and being contrite after an error can have a positive impact on resolving conflicts. He cited a program, started in 1995 at what was then Rush-Presbyterian-St. Luke's Medical Center in Chicago, that provides for voluntary mediation of all malpractice claims and a limited apology. The hospital reported that nonbinding mediation with an apology has assisted in the settlement process, he said.

"Focusing more on effective communication is a low-cost way to improve the tort system," Adams said.

Professor Alice Brown, PhD, of Scotland, said effective complaint handling is another option. As the first Scottish Public Services ombudsman, she gets patient complaints that haven't been resolved with the physician or hospital. An effective response can stop a patient from seeking litigation, she said. "The ombudsman is seen as an alternative to the courts."

AMA Trustee Rebecca J. Patchin, MD, said the AMA has looked at systems in other countries and examined such alternatives. She said the AMA has supported state legislation that has placed caps on noneconomic damages and is still pursuing federal legislation to alleviate the medical liability crisis.

"We think we need to stabilize the system in crisis [in the United States] with proven reforms. Once we can stabilize the system, what we'll need to do is test alternative programs," said Dr. Patchin, an anesthesiologist and pain-management specialist in Riverside, Calif., and chair of the AMA's task force on medical liability reform.

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It works for them

Other countries have explored ways to keep medical liability insurance affordable. Highlights of some systems include:


  • Tort-based compensation system.
  • Relatively inexpensive insurance, compared with other international models.
  • Compensation limited to cases in which fault is proven or settlement is made.


  • A fault system kicks in when it appears that a physician's actions may have caused an injury.
  • Injured parties have access to civil, criminal, administrative and professional tribunals.
  • No-fault system exists for injuries resulting in incapacity of at least 25% when no fault is declared.

New Zealand

  • Accident compensation program.
  • Restricted version of no-fault.
  • Physicians found at fault are open to professional, financial and legal sanctions separate from patient compensation.

United Kingdom

  • Tort-based, government-sponsored indemnity program.
  • Three medical defense societies provide legal protection and advice to private practice doctors.

Sources: Canadian Medical Protective Assn.; SECOR Corp. Consulting

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The Swedish solution

  • Compensation is paid only if an experienced specialist could have avoided the injury. For a general practitioner, an experienced GP is the standard.
  • Compensation for injuries ranges from about $1,200 to $980,000, with most cases averaging less than $2,400.
  • Only about 10 of every 9,000 claims filed by injured patients head to court.
  • The country's non-litigious culture helps keep legal battles down.

Sources: SECOR Corp. Consulting; Kaj Essinger, CEO of the County Councils and Regions Mutual Insurance Co.

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Medical leaders emphasize safety over punishment

Some medical leaders say malpractice lawsuits are not an effective way to hold physicians accountable and improve patient safety.

They say countries around the world should explore other ways to make physicians take responsibility for their actions and promote quality health care. Experts are calling for new relicensing efforts, maintenance of certification and physician profiles on the Internet.

Sir Graeme Catto, MD, president of the General Medical Council, which regulates doctors in the United Kingdom, said the GMC wants to start a program to enhance patient safety and create public confidence that licensed doctors are fit to practice. The plan calls for a new registration system with compulsory revalidation. Doctors would be issued a license when they register with the GMC, and would keep their licenses by revalidating them periodically. The plan has not been implemented yet.

Lifelong learning is also viewed as a way to maintain high standards of care. For example, the Royal College of Physicians and Surgeons of Canada implemented its mandatory Maintenance of Certification program in 2000. Officials said participation rates in the program, which includes self-directed learning activities and practice assessment, exceeded 90% in 2004.

Publishing physician discipline actions also was discussed at the Physician Insurers Assn. of America's International Section Conference last month in Ottawa. Patients in the United States were pleased when medical boards began placing physician information and discipline online, but many doctors have fought to keep information on malpractice lawsuits out of the profiles. Doctors say that posting lawsuits may mislead patients because of the high number of frivolous lawsuits filed.

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