Court Rule Change Would Create Health Care Crisis, House Majority Policy Committee Learns

2/14/2019 HARRISBURG – Seeking to prevent a health care crisis in Pennsylvania, physicians, administrators, attorneys and industry professionals told members of the House Majority Policy Committee during a public hearing in Harrisburg today that the Pennsylvania Supreme Court must not change a rule dealing with medical malpractice lawsuits.

“There is a pending proposal that would reverse progress that has been made to ensure access for all Pennsylvanians, regardless of ZIP codes, to quality health care,” said Policy Committee Chairman Donna Oberlander (R-Clarion/Armstrong/Forest). “This proposed action has the potential to cripple the state’s health care industry and break the valued bond between a patient and his or her doctor. This could put health care into a crisis situation. This hearing is designed to raise awareness of the issue in an attempt to let the court know how harmful this decision could be.”

The court is currently considering whether to unilaterally repeal a rule that prevents medical malpractice plaintiffs from filing civil lawsuits in counties with more favorable jury payouts, namely Philadelphia. The rule was initially adopted as part of a series of reforms – developed by all three branches of government in 2002 and 2003 – to help stabilize the insurance market. This was necessary to alleviate skyrocketing and unavailable malpractice insurance, particularly in high-risk specialties such as obstetrics, orthopedics and neurosurgery.

Since the rule was implemented in the early 2000s, medical malpractice insurance rates stabilized, keeping doctors practicing in Pennsylvania and alleviating a shortage of physicians and specialists. In fact, the average number of medical malpractice cases filed statewide since the high of 2,094 in 2002 is 1,599. According to Kevin Cottone, law partner at White and Williams, LLP, annual medical malpractice filings have remained fairly consistent since 2009.

“The reduction in filings demonstrates that the tort reform measures enacted more than 15 years ago by the Legislature and the Supreme Court are working. Nothing in the data indicates that requiring plaintiffs to bring suit in the county in which the medical malpractice claim arose deprives alleged victims of access to the courts,” Cottone added.

Those who testified also agreed that it continues to make logical sense that the county in which the alleged action took place should be the one where a case is filed, instead of a jurisdiction with no real connection to the alleged harm.

Cottone argued that in an era of ever-consolidating health care systems, physicians who practice in any part of the state could easily be dragged to Philadelphia or any other remote location because of any type of business affiliation. That leads to inherent unfairness within the system.

All at the hearing agreed that doctors’ insurance premiums would skyrocket, and that would pose undue hardships on physicians, health care facilities and ultimately, patients – risking access to care.

Since word of the proposed repeal was made public in December, Noah Karn of the Insurance Federation of Pennsylvania said his organization and others have sought out guidance on how a repeal would impact insurance rates. He reported that preliminary findings indicate a repeal of the current rule would cause a significant increase in medical malpractice premiums, especially in urban and suburban markets, with high-end specialists being most directly impacted.

“This proposed venue rule change could threaten patient access to quality physician care,” said Dr. Danae Powers, president of the Pennsylvania Medical Society. “The increased cost may place providers and hospitals under greater financial strain. The concern is that many rural hospitals, already struggling to remain solvent, will be further threatened with closure. We must learn from history. We have stabilized the situation. Let’s not destabilize it again.”

The hearing also included written remarks from an emergency physician with more than 40 years of experience.

“If this proposed rule change is adopted by the Pennsylvania Supreme Court, the cost of malpractice premiums would again continue to rise, indirectly causing patients to pay higher medical costs, and it would impact recruitment of physicians in non-urban areas,” wrote Harry Kintzi, M.D. “There would be an increase in malpractice filings, and only the trial attorneys along with a few plaintiffs would benefit to the detriment of most patients, doctors and the health care system. I believe the current laws were enacted in good faith for the betterment of all patients and the health care system in Pennsylvania. Please leave the current [rule] in place.”

Hospitals, which pay many physicians’ premiums, also face the higher costs. According to Mark Zolfaghari with St. Luke’s University Health Network, the rule change would cost more than $50 million per year. The increases in premiums would be absorbed through increased health care costs.

He also explained that the rule change could also reverse or halt educational and health care partnerships, such as the one St. Luke’s has with Temple University in Philadelphia, or the recruitment of physicians in high-risk specialists or underserved areas.

Not only would physician and hospitals face the consequences, but so would the long-term care community.

“For the last 10 years, the long-term care sector has been under attack from predatory, out-of-state law firms who have come here from other states with one goal in mind: to file hundreds of lawsuits against providers. Big or small, national chain or a single facility, they don’t care — everybody is a target,” said Diane Johnson, regional director of Operations for HCR ManorCare, a national long-term care and rehabilitation company that currently operates 42 skilled nursing facilities and 10 memory care facilities. “The threat of a jackpot award, even for a frivolous claim, is very much a ‘dark cloud’ that hangs over our sector and affects the way we operate.”

She also noted that for every Medicaid resident they care for, nearly $2,000 of each patient’s care rate each year is used to help pay to defend the barrage of frivolous lawsuits. That health care sector spent more than $100 million Medicaid dollars to help pay litigation costs and liability insurance last year alone.

Also testifying at today’s hearing at the state Capitol was Christopher Addis, M.D., Penn Medicine/Lancaster General Health, and written remarks were submitted by David O’Gurek, M.D, president of Pennsylvania Academy of Family Physicians; Daniel Durst, Esq., Chief Rules Committees Counsel, Civil Procedural Rules Committee; and Cynthia Buchman of Good Shepherd Hospital in Allentown. Additionally, letters to the court have been submitted by Speaker of the House Mike Turzai (R-Allegheny) and Majority Leader Bryan Cutler (R-Lancaster), along with Judiciary Chairman Rob Kauffman (R-Franklin).

In part, the letter submitted by Turzai and Cutler asked the court to preserve the rule: “Doing so would preserve a significant piece of a multi-branch public policy effort that has a 15-year track record of success in keeping the practice of medicine affordable and accessible throughout our Commonwealth. The current rule struck a proper constitutional balance between the branches, and we will use the powers delegated to us as we stand behind the medical professionals who want to provide the best quality of care at affordable rates.”

Oberlander emphasized that residents can do their part to ensure their voices are heard by visiting PAGOPPolicy.com and sharing with the court how such a rule change could impact their health care.

Representative Donna Oberlander

63rd District

Pennsylvania House of Representatives

Media Contact: Jennifer Keaton

717.705.2094