Exploring Human Potential

Could Don Berwick Use Medicare To Link Medical Liability Reform To The Patient Safety Movement?

Mike Magee

Despite all the progress in scientific research and technological advancements, at its core, health care remains a huge and complex human endeavor struggling for perfection. How huge? 900 million office visits and 35 million hospital discharges per year.(1)  How complex? Complex enough to have spurned a massive defensive and litigious malpractice system whose annual cost this year has been pegged at 55 billion.(2) The goal? A culture of safety and reliability. The problem? Our medical malpractice system in this country suffers from a fundamental disconnect to our safety movement.

Don Berwick MD, arguably the father of Deming style process re-engineering and continuous improvement methods in health care, has just assumed the lead role in Medicare. Deming and Berwick both argued that continuous improvement can only thrive in a culture of openness and transparency. But medical liability promotes secrecy and retrenchment. Might it be possible for Dr. Berwick to design within the Medicare program test sites that experimentally link liability reform to patient safety improvements?

A head-to-head comparison outlines the challenge. The tort system uses litigation as its lever for change. The safety movement uses quality improvement analysis. Tort law focuses on the individual. Safety focuses on the process. The tort system’s punitive and adversarial style drives information down, encouraging secrecy. The safety movement uses a non-punitive and collaborative approach, which encourages openness, transparency, and continuous improvement. With tort law, exposing oneself can end one’s career and harm one’s mental health. In the safety movement, contributing is career-enhancing and therapeutic.(3,4)

Let’s have a closer look. Medical malpractice law was designed to accomplish certain specific social objectives. These include addressing poor quality care, fairly compensating patients for injuries resulting from negligence, and imposing justice in a manner that would make future occurrences less likely. Malpractice law is a part of the family of personal injury or tort law. For a plaintiff to succeed, she must prove that the injury suffered resulted from actions that were fundamentally inconsistent with the recognized standard of care. Whether or not such injury rises to the level of negligence is a matter of degree. (5)

In theory, it all makes sense. Courts provide oversight offering corrective action when professional oversight breaks down. Doctors and hospitals are insured and therefore assured that a claim will not lead to financial ruin. Patients show restraint, acting only when there has been an undeniable breach. And lawyers pursue only meritorious claims and discourage those that lack merit.

But in practice it doesn’t come close. As three well-known scholars have noted, the medical malpractice system “has internal logic but falls far short of its social goals of promoting safer medicine and compensating wrongfully injured patients.”(3) The medical malpractice system is fundamentally adversarial and built on a culture of blame. Doctors, hospitals, insurers and lawyers are locked into battle and patients are routinely caught in the crossfire.

This disturbing state of affairs, captured in a 1998 expert consensus editorial in the Journal of the American Medical Association focused on improving the safety performance of our health care system, concluded that “a new understanding of accountability that moves beyond blaming individuals when they make mistakes must be established if progress is to be made.”(4)

For some time prior to this statement, it had been abundantly clear that the American medical malpractice system was ineffective in managing the appropriate distribution of compensation to deserving patients. Studies in the 1970s, 1980s and 1990s drew near-identical results. (3,5,6,7) The most often-quoted study was conducted in 1984 when Harvard examined 30,000 medical records and 3,500 malpractice claims from New York hospitals. From the medical records they determined that four percent of patients had suffered adverse events, and that one percent rose to the level of negligence. But when they correlated these records with malpractice claims, they found that only two percent of the patients who had suffered from negligence had actually submitted claims, and only seventeen percent of the malpractice claims were in any way tied to negligence. (3)

Beyond the current system’s inability to connect cause to corrective action, the medical malpractice system is organizationally unstable, expensive and inefficient. Three of the last four decades have witnessed major medical malpractice crises. The crisis of the 1970s involved availability of insurers. The crisis in the 1980s involved affordability, and the crisis of the 2000s involves both availability and affordability.(3,8,9,10)

Factors contributing to our current insurer instability trace back to the 1990s and include large payouts in 1999, declining stock market investments, heavy competition leading to price compression, increased cost for reinsurance post 9/11, and wide geographic variability in awards and overhead. Sixty cents of every dollar spent in the malpractice system goes to administrative costs. That’s twice the amount spent administering the Workers Compensation System.(3)

Attempts to correct the system have gained steam over the years, but only represent tinkering at the edges, not true reform. They include limiting access to the courts, limiting the number of claims, and limiting the size of the awards.(3) Yet even if all of these reforms were successful, they would leave America’s doctors, patients, researchers and insurers very poorly served for one very critical reason, and the reason is this: the American malpractice system, embedded in personal injury law, fundamentally undermines the patient safety movement.(4)

It may seem counterintuitive, but for medical malpractice to achieve its stated social purpose it must abandon the emphasis on a tort-based approach and embrace safety. Alternate dispute resolution, no-fault systems, raising fault to the institutional level, and exploring the use of medical courts all merit consideration and could begin to break the cycle of blame and provide a level of security necessary to ensure openness and transparency.(3,4)

The resulting flow of error and risk management data would accelerate process re-engineering, expose glaring disparities, expand collaborations across silos, and promote the development of common language and tools embedded in electronic information systems. It would also encourage risk-taking, which is essential for innovation, discovery and progress. All of these things are necessary if we are to reach the quality and prevention “tipping point.”

But “tipping points” require a “launching point”. Perhaps Medicare could be that launching point with Don Berwick our pilot.

For HealthCommentary, I’m Mike Magee.


1. Gandhi TK and Lee TH. Patient Safety Beyond The Hospital. NEJM. 363;11. Sept. 9, 2010. 1001-3.

2. Mello MM, Chandra A, Gawande AA, Studert DM. National Costs of the Medical Liability System. Health Affairs, 29, no. 9 (2010): 1569-1577

3.Studdert DM, Mello MM, Brennan TA. Medical malpractice. NEJM. 2004;350:283-292.

4.Leape LL, Wood DD, Hatlie MJ, Kizer KW, Schroeder SA, Lundberg G.D. Promoting patient safety by preventing medical error. JAMA. 1998;280:1444-1447.

5.Robinson GO. The malpractice crisis of the 1970s: a retrospective. Law Contempt. Probl 1986;49:5-35. Quoted in Studdert et al.

6.Kinney ED. Malpractice reform in the 1990s: past disappointments, future success? J Health Polit Policy Law. 1995;20:99-135. Quoted in Studdert et al.

7.Localio AR, Lawthers AG, Brennan TA, et al. Relation between malpractice claims and adverse events due to negligence: results of the Harvard Medical Practice Study III. NEJM. 1991;324:370-6.

8.Mello MM, Studdert DM, Brennan TA. The new medical malpractice crisis. NEJM. 2003; 348:23, 2281-2284.

9.Kakalik JS, Pace NM. Costs and compensation paid in tort litigation. R-3391-ICJ. Santa Monica, Calif. Institute for Civil Justice, RAND, 1986.

10.Weiler PC, Hiatt HH, Newhouse JP, Johnson WG, Brennan T, Leape LL. A Measure of malpractice: medical injury, malpractice litigation and patient compensation. Cambridge, Mass. Howard University Press; 1993.

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