PATIENTS’ COMPENSATION SYSTEM
A PROPOSAL THAT WORKS FOR PHYSICIANS AND THEIR PATIENTS
Presentation to:

AAFP State Legisla...
ADDRESSING A SIGNIFICANT PROBLEM

SB141 represents a bold, new, innovative approach
to healthcare …
• Thousands of hours o...
THOUGHTFUL APPROACH

SB141 represents a bold, new, innovative approach
to healthcare …
• Based on scientific research, dat...
WE’RE SOUTHERNS …

We like our college football …

2655 Northwinds Parkway • Alpharetta, GA 30009 • 877 248 1689 • www.pat...
2655 Northwinds Parkway • Alpharetta, GA 30009 • 877 248 1689 • www.patientsforfaircompensation.org
© Copyright 2013

5
CURRENT TORT SYSTEM BROKEN

 Promotes Defensive Medicine
• GALLUP - 26% of overall healthcare costs
• Cost up to $650 Bil...
REDUCES BOTH LITIGATION COSTS AND
COST OF DEFENSIVE MEDICINE

Traditional tort
reform only
reduces the cost
of litigation
...
PHYSICIANS PRACTICING DEFENSIVE MEDICINE (%)

82%
90%
80%
70%
60%
50%
40%
30%
20%
10%
0%

0%
U.S.

Canada

0%
U.K.

0%

0%...
WHY DO PHYSICIANS PRACTICE DEFENSIVE MEDICINE?

 Avoid personal financial exposure
from “jackpot justice” awards from
non...
WHAT HAVE GEORGIA PHYSICIANS TOLD US?

 82% of Georgia physicians practice defensive medicine
 74% of Georgia physicians...
DEFENSIVE MEDICINE IS REAL

2655 Northwinds Parkway • Alpharetta, GA 30009 • 877 248 1689 • www.patientsforfaircompensatio...
DEFENSIVE MEDICINE IS COSTLY

2655 Northwinds Parkway • Alpharetta, GA 30009 • 877 248 1689 • www.patientsforfaircompensat...
DEFENSIVE MEDICINE IS PERVASIVE

2655 Northwinds Parkway • Alpharetta, GA 30009 • 877 248 1689 • www.patientsforfaircompen...
DEFENSIVE MEDICINE HURTS EVERYONE

2655 Northwinds Parkway • Alpharetta, GA 30009 • 877 248 1689 • www.patientsforfaircomp...
DEFENSIVE MEDICINE IS REAL

2655 Northwinds Parkway • Alpharetta, GA 30009 • 877 248 1689 • www.patientsforfaircompensatio...
BUSINESS LEADERS ENGAGED

Atlanta Business Chronicle, 10/21/2013
2655 Northwinds Parkway • Alpharetta, GA 30009 • 877 248 ...
WHY DEFENSIVE MEDICINE HARMS PATIENTS?

 Unnecessary tests & procedures

 “High risk” patients denied care
• Sometimes r...
PATIENTS LOSE IN CURRENT LITIGATION SYSTEM

› Drives wedge between patient / physician
› Denies access to justice
› <5% of...
CURRENT SYSTEM IN CRISIS :: ACCESS TO JUSTICE

Summary of Findings:
 Attorneys require $500,000 of economic damages to
ta...
THE SOLUTION

Replace Tort System with an
Administrative Compensation System:

Patients’ Compensation System

2655 Northwi...
PATIENTS’ COMPENSATION SYSTEM
HOW DOES IT WORK?
Patient Advocate
1

2

6

Quality
Improvement
Department

Medical Review
D...
PATIENTS’ COMPENSATION SYSTEM
PATIENT ADVOCATE
1

1. Patient Advocate
› Helps patient navigate
through the system…

2655 N...
PATIENTS’ COMPENSATION SYSTEM
MEDICAL REVIEW DEPARTMENT

2

2. Medical Review
Department
› Headed by CMO – Physician
› Gat...
PATIENTS’ COMPENSATION SYSTEM
INDEPENDENT MEDICAL REVIEW PANEL

3. Independent Medical
Review Panel
› Pre-approved physici...
PATIENTS’ COMPENSATION SYSTEM
COMPENSATION DEPARTMENT

4. Compensation
Department
› Total compensation may not
exceed tota...
PATIENTS’ COMPENSATION SYSTEM
ADMINISTRATIVE LAW JUDGE

5. Administrative
Law Judge
› Ensures process is
applied in accord...
PATIENTS’ COMPENSATION SYSTEM
QUALITY IMPROVEMENT DEPARTMENT

6. Quality Improvement
Department
6

› Records all claims da...
SOURCE OF FUNDS

 Funded through money in system today

2655 Northwinds Parkway • Alpharetta, GA 30009 • 877 248 1689 • w...
MORE EFFICIENT USE OF EXISTING FUNDS

Current System
20%
Injured Patients

17.5%

3-5 years

Malpractice
Costs

Patient Co...
PATIENT BENEFITS

 All complaints are reviewed
 Faster payment of claims – months vs. years
 Reduces exposure to unnece...
PHYSICIAN BENEFITS

 Physicians will never be sued again … Ever
 No personal financial risk

 Does NOT assign blame
 S...
WHO IS THE OPPOSITION?

 Those who profit from the current system where

doctors, healthcare professionals and hospitals ...
IMPACT ON MALPRACTICE COST

Average GA
Medical
Malpractice
Carrier –
Current Tort
Liability

Patient
Compensation
System
A...
NO INCREASED COSTS

 Awards may not exceed the fiscal year 2013 aggregate
costs of medical malpractice as determined by a...
NO INCREASED REPORTING
The bill specifically limits the power of the medical
review panel to determining avoidable harm.

...
IMPACT ON GEORGIA

Two Actuarial Studies :: AON and BioScience
Valuation
Peer review by David Frisvold (Assistant
Professo...
SUMMARY…

 PCS is a Solution to Completely Replace the Current Tort System
•
•
•
•
•
•
•
•
•

No more medical malpractice...
QUESTIONS?
Contact Information:
Wayne W. Oliver
Executive Director, Patients for Fair Compensation
E-mail: WOliver@Patient...
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Senator Brandon Beach & Wayne Oliver's 2013 SLC Presentation

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Senator Brandon Beach & Wayne Oliver's 2013 SLC Presentation

  1. 1. PATIENTS’ COMPENSATION SYSTEM A PROPOSAL THAT WORKS FOR PHYSICIANS AND THEIR PATIENTS Presentation to: AAFP State Legislative Conference Senator Brandon Beach District 21, North Atlanta Wayne W. Oliver Executive Director, Patients for Fair Compensation November 1, 2013
  2. 2. ADDRESSING A SIGNIFICANT PROBLEM SB141 represents a bold, new, innovative approach to healthcare … • Thousands of hours of engagement by national and international thought leaders • Investment into clinical research, original thought leadership, data and analytics, actuarial reports, and peer-review studies • Gaining nationwide attention as policy makers look for an answer to out-of-control healthcare costs • PCS solution saves lives, advances patient safety, decreases the cost of healthcare, saves taxpayers, physicians and families money and fairly and appropriate compensates legitimately injured patients 2655 Northwinds Parkway • Alpharetta, GA 30009 • 877 248 1689 • www.patientsforfaircompensation.org © Copyright 2013 2
  3. 3. THOUGHTFUL APPROACH SB141 represents a bold, new, innovative approach to healthcare … • Based on scientific research, data analysis, medical experts and actuarial studies • Working with specialty and professional societies to create the best bill • Will work with state and national societies to replicate and pass on lessons learned … 2655 Northwinds Parkway • Alpharetta, GA 30009 • 877 248 1689 • www.patientsforfaircompensation.org © Copyright 2013 3
  4. 4. WE’RE SOUTHERNS … We like our college football … 2655 Northwinds Parkway • Alpharetta, GA 30009 • 877 248 1689 • www.patientsforfaircompensation.org © Copyright 2013 4
  5. 5. 2655 Northwinds Parkway • Alpharetta, GA 30009 • 877 248 1689 • www.patientsforfaircompensation.org © Copyright 2013 5
  6. 6. CURRENT TORT SYSTEM BROKEN  Promotes Defensive Medicine • GALLUP - 26% of overall healthcare costs • Cost up to $650 Billion to US citizens • $14 billion annually to Citizens of Georgia  Prevents Access to Justice • Less than 20% of injured patients receive compensation • Less than 1% receive Jury Award  Hurdle for Patient Safety • Unable to significantly improve under a “Blame & Shame” system… 2655 Northwinds Parkway • Alpharetta, GA 30009 • 877 248 1689 • www.patientsforfaircompensation.org © Copyright 2013 6
  7. 7. REDUCES BOTH LITIGATION COSTS AND COST OF DEFENSIVE MEDICINE Traditional tort reform only reduces the cost of litigation Patients’ Compensation System COST OF LITIGATION $31 Billion ** per year Physicians in states with traditional tort reform practice same amount of defensive medicine as other states… Source: “A Costly Defense” published by Jackson Healthcare September 21, 2011 02/25/13 COST OF DEFENSIVE MEDICINE $650 Billion per year ** Source: BioScience Valuations report July 19, 2012 2655 Northwinds Parkway • Alpharetta, GA 30009 • 877 248 1689 • www.patientsforfaircompensation.org © Copyright 2013 7
  8. 8. PHYSICIANS PRACTICING DEFENSIVE MEDICINE (%) 82% 90% 80% 70% 60% 50% 40% 30% 20% 10% 0% 0% U.S. Canada 0% U.K. 0% 0% Sweden New Zealand U.S. physicians are only ones personally financially liable for malpractice; and the only ones practicing defensive medicine. 2655 Northwinds Parkway • Alpharetta, GA 30009 • 877 248 1689 • www.patientsforfaircompensation.org © Copyright 2013 Source: Pacific Research Survey June 24, 2011 8
  9. 9. WHY DO PHYSICIANS PRACTICE DEFENSIVE MEDICINE?  Avoid personal financial exposure from “jackpot justice” awards from non-peers  Physicians abhor defending against lawsuits Source: “A Costly Defense” published by Jackson Healthcare September 21, 2011 2655 Northwinds Parkway • Alpharetta, GA 30009 • 877 248 1689 • www.patientsforfaircompensation.org © Copyright 2013 9
  10. 10. WHAT HAVE GEORGIA PHYSICIANS TOLD US?  82% of Georgia physicians practice defensive medicine  74% of Georgia physicians believe that defensive medicine negatively impacts patient care  95% of Georgia physicians support PCS Proposal  96% Georgia physicians agree that a PCS solution would reduce healthcare costs Source: “The Practice of Defensive Medicine” Oppenheim Research January 12, 2012 2655 Northwinds Parkway • Alpharetta, GA 30009 • 877 248 1689 • www.patientsforfaircompensation.org © Copyright 2013 10
  11. 11. DEFENSIVE MEDICINE IS REAL 2655 Northwinds Parkway • Alpharetta, GA 30009 • 877 248 1689 • www.patientsforfaircompensation.org © Copyright 2013 11
  12. 12. DEFENSIVE MEDICINE IS COSTLY 2655 Northwinds Parkway • Alpharetta, GA 30009 • 877 248 1689 • www.patientsforfaircompensation.org © Copyright 2013 12
  13. 13. DEFENSIVE MEDICINE IS PERVASIVE 2655 Northwinds Parkway • Alpharetta, GA 30009 • 877 248 1689 • www.patientsforfaircompensation.org © Copyright 2013 13
  14. 14. DEFENSIVE MEDICINE HURTS EVERYONE 2655 Northwinds Parkway • Alpharetta, GA 30009 • 877 248 1689 • www.patientsforfaircompensation.org © Copyright 2013 14
  15. 15. DEFENSIVE MEDICINE IS REAL 2655 Northwinds Parkway • Alpharetta, GA 30009 • 877 248 1689 • www.patientsforfaircompensation.org © Copyright 2013 15
  16. 16. BUSINESS LEADERS ENGAGED Atlanta Business Chronicle, 10/21/2013 2655 Northwinds Parkway • Alpharetta, GA 30009 • 877 248 1689 • www.patientsforfaircompensation.org © Copyright 2013 16
  17. 17. WHY DEFENSIVE MEDICINE HARMS PATIENTS?  Unnecessary tests & procedures  “High risk” patients denied care • Sometimes referred to as reverse defensive medicine  Physicians cannot afford to admit mistakes  Increased overall cost of healthcare • Both health plan and out-of-pocket expenses … 2655 Northwinds Parkway • Alpharetta, GA 30009 • 877 248 1689 • www.patientsforfaircompensation.org © Copyright 2013 17
  18. 18. PATIENTS LOSE IN CURRENT LITIGATION SYSTEM › Drives wedge between patient / physician › Denies access to justice › <5% of filed cases go to jury › Patients receive <50% of awards on legal & administrative costs › 5 – 7 year process › Stress of litigation… Source: PIAA, 2011 Report Towers Watson Study, 2011 2655 Northwinds Parkway • Alpharetta, GA 30009 • 877 248 1689 • www.patientsforfaircompensation.org © Copyright 2013 18
  19. 19. CURRENT SYSTEM IN CRISIS :: ACCESS TO JUSTICE Summary of Findings:  Attorneys require $500,000 of economic damages to take case  Denies any “Access” to anyone that is on Medicaid, Medicare, Out of Job, elderly, poor, young people  80% of all legitimate medical injuries fall UNDER $500,000 Source: JUSTICE IN CRISIS: Victim Access to American Medical Liability System, 2013 Professor Joanna Shepherd Bailey, Ph.D. Emory University School of Law 2655 Northwinds Parkway • Alpharetta, GA 30009 • 877 248 1689 • www.patientsforfaircompensation.org © Copyright 2013 19
  20. 20. THE SOLUTION Replace Tort System with an Administrative Compensation System: Patients’ Compensation System 2655 Northwinds Parkway • Alpharetta, GA 30009 • 877 248 1689 • www.patientsforfaircompensation.org © Copyright 2013 20
  21. 21. PATIENTS’ COMPENSATION SYSTEM HOW DOES IT WORK? Patient Advocate 1 2 6 Quality Improvement Department Medical Review Department 3 5 Independent Medical Review Panel Administrative Law Judge 4 Compensation Department 2655 Northwinds Parkway • Alpharetta, GA 30009 • 877 248 1689 • www.patientsforfaircompensation.org © Copyright 2013 21
  22. 22. PATIENTS’ COMPENSATION SYSTEM PATIENT ADVOCATE 1 1. Patient Advocate › Helps patient navigate through the system… 2655 Northwinds Parkway • Alpharetta, GA 30009 • 877 248 1689 • www.patientsforfaircompensation.org © Copyright 2013 22
  23. 23. PATIENTS’ COMPENSATION SYSTEM MEDICAL REVIEW DEPARTMENT 2 2. Medical Review Department › Headed by CMO – Physician › Gathers all pertinent medical records › Interviews all relevant parties › Makes prima facie determination of medical injury › Appoints expert panel… 2655 Northwinds Parkway • Alpharetta, GA 30009 • 877 248 1689 • www.patientsforfaircompensation.org © Copyright 2013 23
  24. 24. PATIENTS’ COMPENSATION SYSTEM INDEPENDENT MEDICAL REVIEW PANEL 3. Independent Medical Review Panel › Pre-approved physicians and other medical experts › 3 physicians – if only a physician 3 is involved › 3 physicians plus 2 other experts if system is involved › All identifiers of patient and providers are redacted › RESULT: Rules claim as a “Medical Injury” – “Yes” vs. “No” 2655 Northwinds Parkway • Alpharetta, GA 30009 • 877 248 1689 • www.patientsforfaircompensation.org © Copyright 2013 24
  25. 25. PATIENTS’ COMPENSATION SYSTEM COMPENSATION DEPARTMENT 4. Compensation Department › Total compensation may not exceed total malpractice costs for 2013 › Creates compensation schedule for each type of injury & severity › Awards compensation if panel says medical injury has occurred… 4 2655 Northwinds Parkway • Alpharetta, GA 30009 • 877 248 1689 • www.patientsforfaircompensation.org © Copyright 2013 25
  26. 26. PATIENTS’ COMPENSATION SYSTEM ADMINISTRATIVE LAW JUDGE 5. Administrative Law Judge › Ensures process is applied in accordance to the law 5 › Limited appeal of process only… 2655 Northwinds Parkway • Alpharetta, GA 30009 • 877 248 1689 • www.patientsforfaircompensation.org © Copyright 2013 26
  27. 27. PATIENTS’ COMPENSATION SYSTEM QUALITY IMPROVEMENT DEPARTMENT 6. Quality Improvement Department 6 › Records all claims data confidentially › Shares lessons learned with providers… 2655 Northwinds Parkway • Alpharetta, GA 30009 • 877 248 1689 • www.patientsforfaircompensation.org © Copyright 2013 27
  28. 28. SOURCE OF FUNDS  Funded through money in system today 2655 Northwinds Parkway • Alpharetta, GA 30009 • 877 248 1689 • www.patientsforfaircompensation.org © Copyright 2013 28
  29. 29. MORE EFFICIENT USE OF EXISTING FUNDS Current System 20% Injured Patients 17.5% 3-5 years Malpractice Costs Patient Compensation System 100% Injured Patients 180 days 80% Malpractice Costs Source: PIAA, 2011 Report Towers Watson Study, 2011 2655 Northwinds Parkway • Alpharetta, GA 30009 • 877 248 1689 • www.patientsforfaircompensation.org © Copyright 2013 29
  30. 30. PATIENT BENEFITS  All complaints are reviewed  Faster payment of claims – months vs. years  Reduces exposure to unnecessary tests  Guaranteed funds for avoidable medical injury  Increased patient safety  Increases Access to Justice  Injured patients are fairly compensated … 2655 Northwinds Parkway • Alpharetta, GA 30009 • 877 248 1689 • www.patientsforfaircompensation.org © Copyright 2013 30
  31. 31. PHYSICIAN BENEFITS  Physicians will never be sued again … Ever  No personal financial risk  Does NOT assign blame  Safe to admit mistakes  Medical malpractice premiums will decrease … 2655 Northwinds Parkway • Alpharetta, GA 30009 • 877 248 1689 • www.patientsforfaircompensation.org © Copyright 2013 31
  32. 32. WHO IS THE OPPOSITION?  Those who profit from the current system where doctors, healthcare professionals and hospitals are sued … • Trial Attorneys • Medical Malpractice Insurance Companies 2655 Northwinds Parkway • Alpharetta, GA 30009 • 877 248 1689 • www.patientsforfaircompensation.org © Copyright 2013 32
  33. 33. IMPACT ON MALPRACTICE COST Average GA Medical Malpractice Carrier – Current Tort Liability Patient Compensation System Alternative Percentage Change Collected Premium 1.00 0.92 -8.1% Paid to Patients 0.23 0.51 119.8% Paid to Defense Attorneys 0.30 0.09 -68.9% Administration Costs 0.17 0.17 0.0% Insurance Company Profit 0.30 0.15 -50.0% Patient Claims 2880 4796 66% Patient Awards 864 1918 122% Categories (Cents per Dollar) 2655 Northwinds Parkway • Alpharetta, GA 30009 • 877 248 1689 • www.patientsforfaircompensation.org © Copyright 2013 33
  34. 34. NO INCREASED COSTS  Awards may not exceed the fiscal year 2013 aggregate costs of medical malpractice as determined by an independent actuary  Significantly decreases defensive medicine saving billions annually for Georgia families  Medical malpractice rates decrease under predictable PCS model  Georgia taxpayers reap savings which is currently being wasted on defensive medicine and med-mal defensive attorneys 2655 Northwinds Parkway • Alpharetta, GA 30009 • 877 248 1689 • www.patientsforfaircompensation.org © Copyright 2013 34
  35. 35. NO INCREASED REPORTING The bill specifically limits the power of the medical review panel to determining avoidable harm.  No Negligence / No Lawsuit  No blame / No increased reporting  Bill specifically prohibits reporting  Shall provide Medical Board with information upon request  Public Safety Issue: May notify Medical Board of “risk of harm to the public” 2655 Northwinds Parkway • Alpharetta, GA 30009 • 877 248 1689 • www.patientsforfaircompensation.org © Copyright 2013 35
  36. 36. IMPACT ON GEORGIA Two Actuarial Studies :: AON and BioScience Valuation Peer review by David Frisvold (Assistant Professor, Department of Economics, Emory University) determined the following  Significant decrease in medical malpractice insurance rates & healthcare expenses  Savings to State of Georgia › $3.1 Billion › $3.8 Billion $6.9 Billion Medicaid State Employee Healthcare Costs Total Savings in First 10 years 2655 Northwinds Parkway • Alpharetta, GA 30009 • 877 248 1689 • www.patientsforfaircompensation.org © Copyright 2013 36
  37. 37. SUMMARY…  PCS is a Solution to Completely Replace the Current Tort System • • • • • • • • • No more medical malpractice lawsuits Strong legal precedent Slashes defensive medicine costs Eliminates bad press Increases access to justice Enhances patient safety More efficient use of existing funds More patients receive more compensation No Cost to Georgia Taxpayers … 2655 Northwinds Parkway • Alpharetta, GA 30009 • 877 248 1689 • www.patientsforfaircompensation.org © Copyright 2013 37
  38. 38. QUESTIONS? Contact Information: Wayne W. Oliver Executive Director, Patients for Fair Compensation E-mail: WOliver@PatientsForFairCompensation.org Tel: 678-690-7970
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