Malpractice costs level off

Jury awards and doctors' payments to settle malpractice lawsuits in Massachusetts have declined 8 percent from their peak in 2001, according to a new state report, potentially easing the insurance crisis that has prompted some physicians to drop out of high-risk specialties such as obstetrics and neurology.

The Board of Registration in Medicine report, set to be released today, found that one of every 15 doctors in the state paid at least one jury award or out-of-court malpractice settlement between 1994 and 2003, a period when the overall cost of resolving malpractice suits rose by 85 percent. However, annual payments began to drop after 2001, from $129 million to $119 million in 2003, reflecting a significant drop in the number of payments made to patients who sue.

So far, malpractice insurance rates have continued to rise, including an 11 percent average increase this year from the ProMutual Group, the state's leading commercial insurer. But ProMutual's chairman said a continuing decline in malpractice costs could curb the need for future rate increases.

''If there's a general trend which is showing a significant leveling off a couple of years in a row, that certainly will be reflected in the premium," said ProMutual chairman Dr. Barry M. Manuel, a surgery professor at Boston University. However, he cautioned that costs could still rise again.

Massachusetts doctors said they took little comfort in the possibility of insurance relief, noting that Massachusetts juries typically award patients almost twice as much as the national average. In addition, they said the malpractice system continues to punish doctors rather than improving patient safety or promptly compensating patients who are victims of medical errors.

''While there is some reason to be slightly encouraged, we believe a crisis still persists," said Dr. Alan C. Woodward, president of the Massachusetts Medical Society.

Kenneth Thorpe, professor of health policy and management at Emory University in Atlanta, said that two-thirds of states have already seen a leveling off of insurance premiums in large measure because malpractice payments aren't rising as quickly as they did in the 1990s. He said numerous states have made it more difficult to file malpractice lawsuits, three-quarters of which are typically dismissed without any payment to the patient.

Massachusetts insurance regulators said the downturn in malpractice costs may be too recent to be reflected in insurance rates here, where there have been little legislative changes. Because jury verdicts typically come more than four years after the incident that prompted the lawsuit, insurers typically make premium requests based on multiyear trends.

The downturn in payments since 2001 is driven almost exclusively by a decline in the number of jury awards and out-of-court settlements from a high of 332 in 2001 to 276 in 2003, according to the Board of Registration. The 17 percent drop in the number of settlements more than offset a continued rise in average payments, which reached a record $431,016 in 2003.

Malpractice attorney Marc L. Breakstone attributed the drop in settlements partly to President Bush's highly publicized efforts to cap malpractice awards, suggesting that his many speeches criticizing excessive malpractice payments may have tilted juries against people who claim they were injured by medical mistakes. ''The Republican message has traction," he said.

But Nancy Achin Audesse, executive director of the board, said that the drop may also reflect improvements in patient safety procedures after the death of Boston Globe columnist Betsy Lehman from a chemotherapy overdose at Dana-Farber Cancer Institute in 1994. Lehman's death launched a wave of safety initiatives in Massachusetts, including a statewide error prevention group and a new state center for patient safety named for Lehman.

''I'm hopeful that injuries are going down," said Audesse. ''Malpractice payments are bad for a lot of reasons, the least of them being the economic damage."

Patient safety specialists have been hard pressed to find evidence that medical mistakes have gone down significantly in the last 10 years despite the increase in safety efforts. However, researchers have found that, when doctors communicate more openly with patients about mistakes, patients are less likely to sue.

The Board of Registration report makes clear that the malpractice crisis falls disproportionately on a few specialties, such as obstetricians and gynecologists, who saw a 33 percent increase in the average size of malpractice payments from 1994 to 2003, spurring a 9 percent reduction in the number of doctors in the specialty over the same period. At the other extreme, psychiatrists have seen both the number of settlements and the average size of them drop since 1999, perhaps reflecting greater willingness by psychiatrists to report sexual misconduct by colleagues, the report said.

Taken together, malpractice settlements cost Massachusetts more than $1 billion over the last decade, equal to $16 per year for every resident. While that's a large sum, it's a tiny fraction of healthcare spending, which exceeds $5,000 per person every year.

The report shows that just 98 of the 37,000 doctors who practiced medicine from 1994 to 2003 accounted for 13 percent of total malpractice payments because they paid three or more settlements. Of those, 48 are no longer practicing medicine, nine have faced board discipline, and the remaining 41 remain on a state watch list for troubled doctors.

Audesse argued that one of the best ways to further reduce malpractice lawsuits in the future would be to create a center in Massachusetts to retrain less skilled doctors and to help all physicians keep up with rapidly changing medical technology. Currently, Audesse said the board often sends troubled doctors to Colorado for assessment of their clinical ability because there is no comprehensive doctor testing program here.

''Is that really the way the most respected and revered healthcare environment in the country should operate? I would say, 'No,' " said Audesse.

Audesse said she hoped the malpractice report would focus debate on the need for changes such as moving away from lawsuits to some sort of compensation fund that would promptly pay patients who suffer a preventable injury. She said victims wait years for financial help and the vast majority of patients never get a dime for their injuries.

Both the Medical Society's Woodward and Manuel of ProMutual agreed.

''We need to make the system more equitable for patients and not have it destroy physicians in the process," Woodward said.

Scott Allen can be reached at allen@globe.com.