Archive for January, 2010

Good Communication Can Reduce Lawsuits

January 28, 2010

by James Otto Heiting

Premiums charged by insurers are outrageous! Profit-driven underwriting for professional negligence makes all of us, except the insurance companies, suffer.

Although virtually every state has enacted some sort of “medical liability reform” to keep down premiums and financial risk to physicians and medical providers, these reforms, while onerous to the injured parties in many cases, have been a dismal failure in reaching the goals intended.

Picture you and your spouse, having had an uneventful pregnancy and carrying your healthy baby to term, reaching the hospital and placing yourselves in the care of the medical personnel there. Through a series of events that would be considered negligent, offensive, and even egregious, your baby does not receive the care that would be appropriate or required under the circumstances; and, as a result, your child suffers severe brain damage. This is your first child, and you may be limited, due to health considerations, from having any others.

You and your spouse deeply love your child, despite the fact that she cannot communicate, she cannot hear, and she is blind. She begins to suffer a series of maladies and requires constant attention. You take her home whenever you can and whenever her condition permits; but it seems that she has to go back to the hospital more and more often, and her condition is getting more grave.

Eventually, you succumb to the recommendations of the medical staff at the hospital, and you “let her go”. She slips away with her little dress on and the little bow in her hair, never to return, leaving behind an unbearable emptiness. Your loss is indescribable.

According to California law, the maximum you could receive in a damages award would be $250,000 for the loss of your child. Because you had some sort of insurance pay the medical bills (even public tax payer generated benefit), there is no entitlement to recover anything for bills that were not out-of-pocket. (The wrongdoer, even through liability insurance, is not responsible to pay back even the medical insurance company.) There is a good chance that you would not be able to recover for the weeks and months that you spent caring for your little girl, for the time that you had to take off work, for the inability to attend to your family, your other financial interests, your business. Obviously, the recovery set by these limits is woefully inadequate.

Even so, even with these limits on damages, insurance companies continue to sharply increase medical liability insurance pricing. I do not blame the injured parties or their attorneys. I do not blame judges or juries. It may be that the costs of defense (the defense lawyers and experts) may be out of control and should be limited. Certainly professional liability insurance carrier profits should be reviewed.

Irrespective of the cause of the increases in premiums, and irrespective of the inadequacy of damages awards available (at least from my perspective), the question arises as to whether there is an approach that would, at least in part, satisfy both sides. I think there is such an approach, but it is unlikely that a change in climate, trust and focus on all sides will occur without a change in practices, customs and time.

In September, President Obama announced a government backed pilot program to find alternative ways to approach the tort system for medical liability cases. He wanted to launch a program meant to cut down on expensive treatment through physicians having to practice “defensive medicine” to “avoid lawsuits”.

I, personally, feel that practicing medicine to avoid lawsuits probably equates to putting patient safety first, one of the other announced goals and requirements of the pilot program. Additional goals included working to reduce preventable injuries, fostering better communications between doctors and patients, insuring that patients are fairly and quickly compensated for medical injuries, reducing the incidence of frivolous lawsuits, and reducing medical liability insurance premiums. These are all laudable goals and may actually work.

Putting patient safety first and working to reduce preventable injuries are obvious and important components. We must remember that the medical profession is a service profession. If you will remember that, and you will keep that as a central component of your practice, it is much less likely that you will suffer claims, especially borderline claims.

Fostering better communication between doctors and patients is absolutely essential. I cannot tell you how many clients I see that come to me because of poor communication, or even refusal to communicate. Patients deserve communication and to be treated with respect and candor. Playing “hide the ball” and acting “holier than thou” will drive your patients to my doorstep.

Ensuring that patients are fairly and quickly compensated for medical injuries is a very exciting part of President Obama’s pilot program. It is exciting because it will hold down the expenses and high cost of defending cases; it will create an atmosphere of cooperation rather than antagonism; and it will serve to reduce medical liability insurance costs.

One of the ways to ensure fair and quick compensation for medical injuries is to encourage full disclosure and communication regarding such injuries. This is a difficult concept for many doctors, but it is effective in changing the mindset of plaintiffs and claimants to one of cooperation and gratitude for honesty and proper intentions. Full disclosure on both sides (recently getting play as “collaborative law” ) will result in much quicker (and more modest) resolution, less anxiety on both sides, less litigation, and probably less frivolous lawsuits.

I was consulted recently by a man who lost his wife due to inattention of nursing staff in an ICU. The medical negligence seemed obvious. The man asked me to represent him against the entity; but he also indicated that the risk manager of the hospital had contacted him and had indicated that the staff had made an error that resulted in the injury to his wife. The thing that drove the man to my office was that he felt insulted that the risk manager went on, in an attempt to minimize staff’s role, by telling him how sick his wife was, anyway, and that she would not have lasted more than a couple of years, even without the untoward events. That woman was everything to that man. She was his world. The risk manager, whether intentionally or otherwise, was diminishing their relationship and her worth. This was a mistake on his part that could and should have been avoided.

He was doing some things very well, though. The risk manager invited the widower to discuss compensation for his loss. (I felt that it was in the best interests of my potential client that I could advise him simply as to how I thought damages should be calculated and how he should approach risk management.) The two met several times and discussed the damages, the loss, and how sorry the risk manager was for this man’s loss. To make a long story short, my client settled the case with the risk manager within a few weeks. Although he settled for about sixty-five percent (65%) of what I saw as the value of the case for settlement purposes, he was able to get prompt resolution and pay a very minimal amount in attorney fees. He saved himself from a potential of years of litigation and probably would have received approximately the same net amount. At the same time, by being open and honest with the patient’s spouse, the risk manager saved the hospital the entire cost of litigation, including an extra $200,000 or so in damages, probably saving over $400,000 over a two or three year period of prospective litigation. By laying all the cards on the table, the hospital saved a lot of money, the risk manager was satisfied, the widower was satisfied to the extent possible, and I was happy that I could provide a service to my client that resulted in a real benefit to him.

In essence, then, my advice to reduce risk is to remember that service is the central component of healthcare, that respect for patients and their safety must be of primary importance; and, in order to foster good relations (and many times avoid claims even where claims are warranted), good and caring communication is the key.

My perspective: I respect, admire and root for health care professionals who care for and give their all for their patients; and I get angered by, and feel disrespected by, and want to teach a lesson to, those healthcare professionals who do not care and/or who want to hide behind arrogance and pomposity.

Workers Compensation "Reform"-At what cost?

January 22, 2010

Workers’ Compensation “Reform”- At what cost?

By Richard H. Irwin, Esq. (Heiting & Irwin)

While it was interesting to read the article authored by one of my learned colleagues in the February’ 09 (Volume 59, Number 2) issue of this magazine, I feel compelled to respond on behalf of the injured worker. After all, that article, although written by someone whom I hold in high regard for her knowledge and professionalism, has a clear and undeniable defense perspective, which “perspective” is admitted to in the opening to her article.

First, she made some valid points. Specifically, there were, in the 1980s, some unscrupulous medical providers who took advantage of not only the system, but also the injured worker. However, many law firms representing injured workers would seek out credible reporting physicians who would not take advantage of the system or the injured worker. In fact, in addition to the obvious reasons for doing this, this was done because it did not take long for these “physicians” to obtain a reputation not worthy of most reputable medical practitioners, with the result that workers compensation judges also felt their opinions were “not worth the paper they were written on”.

In discussing the “Boom of the 1980s” the author stated that “employees took advantage of long periods of temporary disability, then vocational rehabilitation and generous permanent disability settlements [emphasis added]”. Quite frankly, having represented injured workers for over twenty-eight years, such statements concern me. Specifically, it is unfair to suggest that all employees, or for that matter, even the majority of them, took advantage of anything, especially those injured workers with serious injuries. For instance, temporary disability only paid them two-thirds of their average weekly wage up to a maximum “capped” figure. If their earnings were significantly higher, they would not be compensated for any of that loss above the cap. This could, and often did, have devastating financial consequences, for injured workers and their families.

Likewise, what was wrong with the idea of vocational rehabilitation? If an injured worker was unable to return to his or her usual and customary job, at least there was an effort by the workers’ compensation system to return them to work such that they could once again contribute to society and take care of their family. That is not true today.

Similarly, to suggest that permanent disability settlements were “generous” distorts reality. Although there were times when, an injured worker could obtain a significant amount for his/her permanent disability, this was usually accompanied by a significant and life-long disabling condition, many times with intractable pain and extreme physical limitation that would impact the quality of life, their ability to return to work and their family forever. Although a few individuals made for good headlines by abusing the system (including claimants and insurance companies) many deserving employees with severe injuries received nominal compensation that did not come close to adequately compensating them; and their needs were not (and often are not) addressed by the system. In fact, the insurance industry, for obvious reasons, does not want this side of the story to be told.

In the discussion of the 1989 and 1993 reforms the $16,000 vocational rehabilitation “cap” is only briefly touched upon. While it is true that this “cap” was developed to limit costs, and also to streamline the vocational rehabilitation process. It largely limited the applicant to three to six month vocational trade schools, with no guarantee (and a limited likelihood) of employment. In fact, usually $4000-4500 of this $16,000 was paid to a qualified rehabilitation representative who “guided” and “assisted” the applicant in forming a vocational rehabilitation plan and to provide assistance until the conclusion of the vocational rehabilitation program. In addition, the injured worker was previously provided a vocation rehabilitation benefit that provided a maximum of $246/week (wow!) paid to them during the vocational rehabilitation plan. This left very little for the expense for educational retraining and limited the employee to a short term program, often with short-term or no meaningful results.

During the period from 1994 to 2003, the February 2009 article references the 1994 deregulation of the workers’ compensation insurance industry, by indicating that by 1997 some “major” workers’ compensation insurance companies were going out of business in California. It should, however, be pointed out that some insurance companies appeared to use deregulation to undercut their competition to the point that certain of those companies claimed they could no longer afford to do business here. Some who weathered this, though, acted to quickly recoup their (alleged) “losses” by increasing premiums to historically new levels – while blaming the injured worker rather than either their own greed or their own careless management.

But the main focus of my angst and concern from the articles is the April 2004 “reform” legislation (S.B.899).

For years before these “reforms”, workers compensation carriers in California were making significant profits under a system that essentially froze the benefits for injured workers from 1996 through 2002. Then, in 2003, when benefits to injured workers were increased to balance the freeze, the insurance industry put its substantial power, lobbyists and money behind an effort, not only to halt the balancing increase in benefits that the injured worker had waited for over seven years for, but also to further limit the rights and benefits of the injured worker and to increase their own “bottom line” that much more.

Our governor, unfortunately, turned a deaf ear to the needs of the injured employees of the State of California and instead chose to listen to his friends within the insurance industry. The result is a bill fraught with “reforms” that have had the effect of driving the injured worker into greater financial distress and, in many cases, onto public assistance programs or out of the work force entirely. These “reforms” include:

1) The total elimination of any vocational rehabilitation retraianing program for the injured employee who, because of his or her injuries, cannot return to work even in a job that they may have had for several years. The result, obviously, is even more disastrous when you consider the difficulty of their returning to work after having worked in only one industry for the majority of their adult life, and they are now required to search for a job in another, and often unrelated field, with a known and documented, and often obvious, permanent impairment.

2) A reduction in permanent disability benefits of between, in many cases, 50-70%!

This has always been intended to be an amount to assist the worker during a time necessary to recover to the extent possible and to reenter the work force, when a permanent physical or mental impairment has resulted from their injury. To reduce this benefit by such an amount is unconscionable and often has a devastating impact upon an injured worker and their family.

3) A medical utilization review by a physician who will never actually examine the injured employee, who is often out of state, reviewing the medical procedure requested by the injured worker’s often long-time treating physician and making a determination that denies or substantially denies or delays a much needed medical test, procedure, or treatment.

4) A limitation of temporary disability payments to 104 weeks from the date of the first payment. As a result of this unique “reform”, in many cases, if an injured worker collected only a couple of weeks or months of temporary disability after their initial injury, but then more than two (2) years later their condition (for example a disease or a significant low back injury) flared up or deteriorated to the point that they needed surgery, they could be denied any temporary disability. Yet they would be out of work for several weeks or months, recovering from surgery. For injuries after January 1, 2008, the injured worker can now receive a maximum of two years of temporary disability to be paid within five years from the date of injury. Again, even in very serious cases, when the injured employee may be temporarily yet totally disabled for greater than two years, no further TTD benefits will be paid.

5) Apportionment (i.e. a attributing a portion) of disability to an underlying degenerative condition. Even if the individual had absolutely no symptoms or disability attributable to said underlying condition before their work injury, and, arguably, even if the individual could have gone for years, or even a lifetime without ever experiencing symptoms or disability, under the new legislation, a portion or percent of overall disability will be attributed to this asymptomatic and non-disabling condition, reducing the permanent disability benefit.

To make matters worse, every physician I have ever deposed states that degenerative processes are synonymous with the aging process. As such, by permitting apportionment (and the resulting reduction of benefits) to the aging process, this bill is effectively discriminating against injured workers on the basis of age. This is improper and unlawful, yet now sanctioned by this reform legislation.

The previous article asked the question “How has the 2004 reform worked?” In response, let me say that if by “working” you mean that it:

* Has unjustifiably cut many injured workers recoveries by up to 50 to 70 percent;

* Has totally eliminated the ability of an individual who cannot return to the workforce to receive any retraining/vocational assistance;

* Has severely limited temporary disability benefits even in the most serious injury cases, where they are so greatly needed;

* Allows physicians who never see or examine the injured employee to deny and delay reasonable treatment requests by their long-time treating physicians;

* Allows an individual’s work-related disability to be reduced because of age and/or condition(s) that never had resulted in symptoms or disability and which, absent the work injury, never would have;

* Limits physical therapy to a set number of visits (even if post-surgically there is a recommendation for additional therapy);

-then I guess you could say its “working”.

Personally and professionally I have a problem with a system which was created to properly “compensate” the injured employee in lieu of allowing the right of independent civil actions against employers for work injuries, when inequities and unfairness abound.

Equally of concern is the stated fact that many applicant (injured worker) attorneys have left the practice and that, if the current schedules or benefits continue, “very few attorneys will be representing injured workers”. What a travesty it would be if the employee who is the backbone of our economy and who is already being denied rights, benefits and privileges, by this legislation is also effectively denied representation – denied help! Is this “reform”? Is this change for the good?

There is no question that the reforms have reduced costs to insurance carriers, that profits are up – but at what cost to the injured worker? The cost is much too high. We should all want our injured workers to have just and fair rights and benefits, without which he or she, and their family, will not thrive, and in some cases will not survive.

Don’t we owe an obligation to those workers that provide services to and on behalf of their employers, our community and our State on a daily basis, risking injury and, at times, their life, for and in the service of others? Maybe our priorities need to be reevaluated.

This article originally appeared in the November issue of the Riverside Lawyer

Tort Reform-Unintended Consequences

January 22, 2010

Tort Reform – Unintended Consequences

By Jean-Simon Serrano, Esq. (Heiting & Irwin)

Oftentimes, well intentioned legislation can have far-reaching and unintentional consequences.  A great example of this is Civil Code § 3333.4 or “Prop 213” as it is commonly known among those in the field of personal injury litigation.

Mr. Patterson, a client of mine and a retired factory worker, was driving home from the American Legion Hall last year when he was broadsided by a well-known company’s parcel delivery truck, the driver of which had run a red light.  The twisted hulk of metal which had been Mr. Patterson’s car had to be cut apart so paramedics could rush him to the hospital for life-saving treatment.  His right leg was so badly injured in this wreck that it required amputation.  Because his wife had recently fallen ill, Mr. Patterson had unknowingly let his auto insurance lapse.  As a result, he was an uninsured motorist on the date of the accident.  The defendant truck company had full coverage.

Civil Code Section 3333.4 states that a person “shall not recover non-economic losses to compensate for pain, suffering, inconvenience, physical impairment, disfigurement, and other nonpecuniary damages if… (2) The injured person was the owner of a vehicle involved in the accident and the vehicle was not insured…” Civil Code § 3333.4 [emphasis added].

Mr. Patterson’s case provides a clear example of the problems surrounding Prop 213.  As a retiree, he has no loss of income.  As an amputee, he has been provided a prosthetic limb and has minimal future medical expectations.  Medical bills for the amputation come to roughly $3,500.  Though his driving on the date of the accident was flawless, and there is no question that he in no way contributed to the occurrence of the accident, because of Prop 213, Mr. Patterson will receive nothing for the excruciating pain he suffered at the time of the accident.  He will not be compensated for the daily, constant pain he still experiences when he attempts to wear his prosthetic leg – pain which is so great, he often simply can’t wear the prosthesis and must use crutches to get around.  Phantom limb pain, so severe it often wakes him up in the night, will go unaccounted for.  His disfiguring injuries, along with the inability to drive, run, walk, or continue his volunteer duties as a crossing guard for a local elementary school, entitle him to absolutely nothing from the driver who carelessly caused all of these injuries.  Furthermore, he is now unable to continue to look after his wife, whose illness has worsened in recent months.

The intention of Prop 213 was to curb the number of uninsured motorists on the road by pressuring people to get insurance.   Whether it has been successful in doing this is doubtful.  What was unintended but is very clear is the effect this bit of legislation has had on people such as my client, Mr. Patterson.

To make matters worse, plaintiffs in “Prop 213” cases often have a very difficult time finding representation, as most plaintiffs’ personal injury attorneys must summarily refuse such cases as the limitations on recovery imposed by Civil Code § 3333.4 make them impractical for contingent fee representation.  Thus, this legislation also has the unintended consequence of forcing such plaintiffs to proceed in pro per, if at all.

Thankfully, there are certain exceptions to Prop 213.  If the culpable party is found to have been driving while under the influence, Prop 213 does not apply.  This is the only exception specifically provided for in the language of the statute.  Civil Code § 3333.4(c).

Other exceptions, however, have been developing over the years through case law.  One such exception deals with those driving company vehicles in a Workers’ Compensation setting.  Montes v. Gibbens (1999) 71 Cal App 4th 982 held that Civil Code § 3333.4 does not apply to an employee driving his employer’s motor vehicle at the time of an accident.  Thus, the plaintiff in Montes was not precluded from recovering for his pain and suffering despite the lack of personal insurance on the company vehicle he was driving at the time of the accident.

Another exception was created in Hodges v. Superior Court (1999) 21 Cal 4th 109, where the Supreme Court of California held that Civil Code § 3333.4 did not apply where the injuries were caused by a manufacturing defect of the vehicle.  In Hodges, the uninsured plaintiff’s gas tank ruptured when he was rear-ended.

A more recent exception was found in Ieremia v. Hilmar Unified School Dist., (2008) 166 Cal. App. 4th 324.  There, the Court of Appeal for the Second District held that Prop 213 did not apply to a wife who was legally the owner of a vehicle when she did not have actual or constructive knowledge of the ownership.  In Ieremia, the uninsured motorist was driving a car which, unbeknownst to her, had been purchased by her husband days before the accident.  In what was perhaps a bit of a stretch, the Court concluded that, as a matter of law, the plaintiff was not an “owner” of the uninsured vehicle for purposes of Civil Code § 3333.4, and that plaintiff was entitled to recover noneconomic damages such as pain and suffering.

While there is, perhaps, nothing wrong with the intended goal of seeing that all drivers on the road have insurance, Civil Code § 3333.4 is not be the best means to this end.  Prop 213 seems ill-suited to achieving its intended goal, and many, if not most, California drivers are completely unaware of its effects.  Instead of having the intended deterrent effect, it is often not until after a tragic accident that many, such as Mr. Patterson, will ever learn of the horrible consequences to innocent parties – and at that point, it is often too late.

For those who do have coverage and an uninsured motorist causes injuries, uninsured motorist coverage is essential; indeed, it is required by Insurance Code § 11580.2 for all policies in California, but one can opt out with a written waiver.  I, and the firm where I work, Heiting & Irwin, encourage everyone to maintain maximum uninsured and underinsured motorist coverage on their automobile insurance policies.  For minimal expense, one can ensure that they will have full coverage in the event of a tragic accident.  Further, having such coverage allows one to set one’s level of coverage, rather than being constrained by the amount of coverage carried by the tortious party.

In the meantime, my office will be working to see if Mr. Patterson may be extended and/or within one of the exceptions to Prop 213.  Mr. Patterson’s case is truly unfortunate and one that certainly merits exception to this heavy-handed legislation.

This article originally appeared in the July/August 2009 edition of the Riverside Lawyer.

Welcome to the Heiting and Irwin Blog

January 22, 2010

Leadership, Expertise and Ethics

Heiting & Irwin began in 1976 out of a deep commitment to the fundamental values of the American justice system and justice for every client. Our cases come to us not only from judges and other attorneys who respect our work, but also from clients who have personally experienced our dedication and triumphs. We’ve built an outstanding reputation by successfully advocating for those injured through their employment or through the harmful negligence of individuals, government agencies, corporations, and others.

Areas of Practice

  • Catastrophic Injuries
  • Burn Injuries
  • Paralysis
  • Birth Injuries
  • Wrongful Death
  • Auto Accidents
  • Motorcycle Accidents
  • Uninsured Motorists
  • Common Carrier (Bus/Plane/Trains) Accidents
  • Malpractice/Professional Negligence
  • Premises Liability (Property Condition Causes Injury)
  • Product Liability
  • Nursing Home Negligence
  • Workers Compensation/On the job injuries