It's Not Just Healthcare That's Bankrupt - It's Our Legal System, Too

Tyler Durden's picture

Submitted by Charles Hugh-Smith of OfTwoMinds blog,

Yes, there is malpractice, but our current system is insane.

What can you say about a "healthcare" system in which 99% of all physicians will face a malpractice claim in their careers? According to Malpractice Risk According to Physician Specialty (The New England Journal of Medicine), "It was estimated that by the age of 65 years, 75% of physicians in low-risk specialties had faced a malpractice claim, as compared with 99% of physicians in high-risk specialties."
Longtime correspondent Ishabaka (M.D.) provides some context:
"A little legal education is necessary to understand malpractice:For a malpractice suit to be successful, there are five necessary things:
1. A duty to treat - there has to be an established doctor - patient relationship. A typical example would be someone who corners me at a party and asks me what I think is causing their abdominal pain. I give them my card, ask them to make an appointment for a check-up, they never do, and the pain turns out to be fatal cancer - in that case I had no duty to treat.
2. Failure to practice the standard of care - note - this does not mean the BEST care in the world - it means the average, or median standard of care.
3. A physician in the same specialty willing to testify that the doctor practiced below the standard of care - all States require this.
4. Causation - the substandard care has to have caused the patient's problem - again, this requires expert physician testimony.
5. Damages - if the substandard care causes no damage, there is no basis for a suit.
Now, I ask you - how can 99% of obstetrician gynecologists, neurosurgeons, emergency physicians, neonatologists (pediatricians who take care of premature babies in the neonatal intensive care unit), and other high-risk specialists practice worse medicine than average? It's mathematically impossible.
By the way, in the back of law journals are ads for medical expert companies that promise they will get a doctor to testify to anything the lawyer wants.
Yes, there is malpractice, but our current system is insane."

I am not an attorney or a doctor, but it seems self-evident that our legal system enables "fishing expeditions" in search of a settlement by keeping the cost of "fishing" very low, the rewards high and no penalties for abuse of the law, by which I mean issuing unsubstantiated or fraudulent accusations in the hopes of triggering a nuisance settlement, i.e. it's cheaper and less stressful for the accused to pay the accuser a substantial sum to make him go away.

This practice is not unique to medicine. Anecdotally, I have heard from insiders in the insurance industry that there are people who make a good living claiming they were injured in department stores and retail outlets. The claims are bogus, but the grifters know our legal system encourages paying bribes to accusers to avoid the outrageous expense of a court trial.
Give me $10,000 and I'll go away. Do this ten times a year and it's a tidy income.
How can we defend a system where people are rewarded for spewing claims of damages in the hope that a few may stick or the falsely accused will pony up cash to avoid the horrendous expenses of defending oneself against baseless accusations in court?
Ishabaka (M.D.) has practiced medicine in both Canada and the U.S., and he reports that Canada's system for monitoring and dealing with malpractice is more effective at actually limiting incompetence in the system, and it does so without accusing essentially every physician of malpractice in an absurd "line up everyone for target practice" abuse of the legal system.
I do not have the expertise to validate this, and no doubt there are countless complexities to consider, but I find it difficult to believe that "ours is the best possible system," a blanket excuse issued in defense of both sickcare and our equally broken legal system.
I can anticipate that some within the legal profession will say that the low cost of making claims and accusations is worth the corrosive cost and stress of dealing with bogus claims and baseless accusations because it enables the poor and powerless to seek redress.
I find this argument mostly meritless based on two points:
1. How can anyone defend a system as fair, just and cost-effective when 99% of all physicians dealing with serious cases end up being accused of malpractice? It would take about 30 seconds to come up with a lower-cost, more just and effective system than what passes for "justice" in America.
2. The vast majority of poor people don't end up having their day in court because that day in court is as absurdly expensive as sickcare. "Justice" in America goes more or less to the highest bidder, outside of propaganda-type Hollywood films.Legal services are extremely expensive and mostly paid in cash, so only the wealthy can afford legal representation or advice.
We would be remiss not to mention the other factor in malpractice, which is unrealistic expectations of medical science and practitioners. Yes, there are some incompetent doctors who should no longer be allowed to practice medicine. But there are many other factors to consider, for example, those doctors who take on the most hopeless, difficult cases are the ones whose "track record" will appear less than stellar.
Yes, there are legitimate cases of malpractice, and legitimate claims that end up being argued in court. But any system that accuses 99% of its practitioners of gross incompetence is deeply flawed, rife with injustice and bloated by needless waste and stress.

It's not just our healthcare system that is bankrupt--so is our legal system.


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takeaction's picture

When will this shit show just keeps escalating. 

CH1's picture

Maybe when people stop obeying their abusers?

Divided States of America's picture

Oh so when our legal system goes BK, who should I go to sue for damages?? Rosenkratz, Weinberg and Friedman??

The legal system is already rotten to the core a long long time ago thanks to those fuckers.

LetThemEatRand's picture

Did anyone read the actual study that this story is based on?  


Each year during the study period, 7.4% of all physicians had a malpractice claim, with 1.6% having a claim leading to a payment (i.e., 78% of all claims did not result in payments to claimants)."

It's a crisis!  This whole issue is insurance company propaganda.   Sad that even ZH'rs, who are usually good at spotting big corporation propaganda that urges individuals to give up their rights, are so rabidly in favor of same.

LetThemEatRand's picture

The right to make a claim for compensation and hire a lawyer who will take a contingency fee for those who cannot afford to pay a lawyer several hundred dollars an hour (which is most people).  Isn't taking away that right or at least curtailing it the point of this propaganda?

Citxmech's picture

"I am not an attorney or a doctor, but. . . "

Yeah - ask any personal injury attorney how "easy" med mal claims are.  Most I know won't even take them because they're such a gigantic pain in the ass.

eclectic syncretist's picture

Cut the the chase and face facts CHS, our cultural morals are bankrupt, and that's the root problem here.  In fact, I'm not even sure what American culture is any more. 

Now get back to watching Ferguson residents destroy their own neighborhood just to show you how unhappy they are with their current circumstances.

Anusocracy's picture

@ Citxmech

That may true but 7.4% of the doctors PER YEAR of the study were hit with a lawsuit.

That's a lot of lawyers doing something they don't like.

Citxmech's picture

OK - but how many of those suits were undeserved?  In my family alone I can think of at least two people who were basically killed due to incompetant health care and one of which who was put at extreme risk due to improper diagnosis (none of which were prosicuted btw).  

Also, when each doctor sees something like 32 patients per day (or about 8,000 per year), is it that hard to believe that 5-10% of them fuck-up pretty badly at least once per year?  

Being a doctor is a pretty tough job.

drdolittle's picture

One of the biggest fuckups is having 6-12 jurors with no medical education taking the word of two experts both paid for their opinion and trying to judge the case. Special judges and courts for bankruptcy law. Think medical cases are any more difficult than bk cases? Some countries cut out the lawyers. They have physicians pay into a patient damages fund. A team of medical experts hear the claimants case and decide if it has merit. Instead of Uniqwa and Billyjoe who think it's cool cause it's coming from a big insurers pocket. As in, I spill hot coffee on myself and the person who sold me the coffee owes me a couple mil.

Citxmech's picture

That McD's case was that high becasue of punitive damages - not becasue of the injuries suffered.

More likely than a liberal jury (in terms of throwing money the plaintiff's way) you're more likely to see corporate employees (who get paid for jury duty) and retirees - both of whom mostly believe that by stiffing the little guy, their own personal costs will go down.

The mere mention of insurance is kept from the jury out of fear that recoveries might be bigger.

Personally, I like the arbitration system better (usually reserved for smaller cases):  Try the case quickly and cheaply to an experienced lawyer with the right to appeal the decision with costs assessed for losers at that point.

MachoMan's picture

The mcdonalds case is quite a hilarious example of the misperception of the public...  you realize that the damage award was reduced, right?  Trade the headline...

Also, why do you presume that people are too stupid to decide a med mal case?  Do you need special training to determine that a patient shouldn't bleed out from his IV?  Or that if he has diabetes and his left leg is to be amputated, but they cut off the right, this might be a violation of the duty of care?  That a heart surgeon isn't supposed to cut the wrong veins and say "oh shit" and just walk out of the OR?

So you're advocating to make our legal procedures centered around the exception and not the rule?

Do the medical professionals also get to determine what a life is worth?  There's no wonder why this type of system works well in third world countries, where the lives of the poor simply aren't viewed as being worth as much as the rich.

It's been stated numerous times in this thread, but there are so many fucked up things with our legal system, I have no idea why this gets any attention...  it's like politicians arguing over abortion... 

drdolittle's picture

Most lawyers do personal injury cause that's how they pay the bills. Only have to have one or two big scores, as John Edwards

And, annually 7.4%. Over a thirty year career. Think that may lead to some defensive medicine? "Well, it's a slim chance but I don't want to get sued so I'll order a couple grand in tests just to cover my ass".

MachoMan's picture

The problem with that theory is that failure to diagnose cases are born losers.  A typical failure to diagnose case would be where a patient comes in with symptoms that could be numerous illnesses, but the doctor picks the most likely candidate and treats for that, ignoring others, which would most often require expensive and expansive testing to determine.  In these cases, the doctor typically does in fact treat the patient for something consistent with the patient's symptoms.  Compare this with a situation where a doctor saws off the wrong leg, see the difference?  Which one do you think an attorney is more likely to take?  Which one do you think a jury would find more appauling?  Further, what happens when the doctor gets the patient to sign a document stating that he has advised the patient to undergoe additional testing, but the patient has refused or, alternatively, that the nurse accompanying the doctor witnesses the doctor tell the patient this?  You think the patient comes out with anything?

OpenThePodBayDoorHAL's picture

Most Anglo countries including Australia where I live have a simple rule that severely limits all of this: it's called "loser pays". Loser of a lawsuit pays the legal costs of the winner. It stops the worst fishing expeditions in their tracks, but real cases go forward as they should.

Fixing America is not that hard, in terms of the actual legal changes. Fixing the corruption of the politicians, and the apathy of the citizens, that's another story.

boattrash's picture

LTER, to me, the point is also that one can lose everything they have, defending themselves against frivolous lawsuits. These can come from individuals, or worse, Govt Prosecutors.

Look up Arkansas Beauty Queen murder. It was covered in a 1 hour Doc. by 20/20, or some similar show. I've known this family all my life and it was really sad to see them spend their life savings (including the new business they had just completed building) to beat a charge pursued by a team of Bumble-fuck prosecutors, Cops, and expert witnesses. It happens every day.

Miffed Microbiologist's picture

After being in the medical field for 30 years I am shocked at the shambles malpractice claims have done to the field. Insane amount of testing done defensively resulting in diagnostic trees and lack of individually focused care. Clearly incompetent Drs not being sued because of great personas and hand holding skills that impress the unaware. I have even gone out of my way to talk to the family and suggest a better dr. " oh, but dr jones is soooo caring and nice! We have always gone to him."

I worked with one thorasic surgeon who accidentally slashed the aorta TWICE without losing privileges. He had great connections and his family had donated a lot to the hospital. Yep, this shit does happen I'm sad to say. Thank god not often.

Suits happen more for impressions there is a lack of care, not necessarily due to actual incompetence. Often great Drs get targeted unfairly. Not all bad outcomes are the results of bad care.


MachoMan's picture

There is a lot of truth here and some not so much...  First, you're absolutely right that the #1 reason for frivolous medmal claims is bad bedside manner (and also the #1 reason for good claims never being made), which is why you see all the guys giving boob jobs say that "everything went so well" or "you're so beautiful" yada yada...

Second, however, I cannot accept the notion of purely defensive medicine when the money for the testing goes straight into the medical practice's pocket.  The entire field is based upon trust, not only between the patient and the medical professional, but also between the latter and the patient's payer source.  Given that the decision to perform a test is typically not a clear issue, the medical professional has exceptional leeway (note: plausible deniability) to perform a myriad of tests.  In the end, the notion of defensive medicine is a convenient scapegoat given that if the truth were to emerge, then everyone has been fraudulently milking the system.  Which would you proclaim?  That you're a fraud or that someone else is responsible?

Further, there are incredibly simple ways to prevent the abuse of "defensive" medicine.  For example, hospitals have patients sign informed consent contracts for everything under the sun, among other things to limit liability.  In the event that a patient has been advised that he or she should have a procedure performed to rule out other possibilities, then why not get the patient to sign a standard form, stating the patient has been advised but doesn't want the procedure, and leave?  The hospital is then covered, albeit with less revenue.  [note: many practices already do this].

The reason why medical costs are out of control is because there is no policeman to curtail fraud...  Since a bonafide policeman is out of the question (too costly, easily corrupted, and tends to suck), the only solution is to give patients some skin in the game.  If this happens, I guarantee you that there will be more questions about the necessity of the procedures and "we're worried about getting sued" isn't going to cut it when it's get the procedure or eat cat food.  As it stands, most patients couldn't care less...  This is how medical costs get out of control, this is the wellspring from which everything else flows...  people who argue about expensive insurance or worry of lawsuit have cause and effect backwards, insurance companies and lawyers are just hangers on.

Miffed Microbiologist's picture

Today I ordered $81,000 worth of reagents for MRSA molecular testing for my hospital. This will last 3 weeks. Not one penny of this is reimbursable because a standard MRSA culture is 10X cheaper? We do this because I can discover if someone is a carrier of MRSA in 2 hrs vs 72. Therefore, we can prove a person is free of MRSA when they enter the hospital or if they do carry it, housed appropriately.

If a person contracts MRSA in a hospital in the state of CA, their medical care is not Medicare reimbursable. So, system wide it is cost effective. This is just one test the state by legislation has increased our costs. How do you propose we pay for this? Spread the costs over performing other procedures. People scream that a simple bag of saline costing 5 bucks is billed at $500, this is one of the reasons why.

I am not saying Drs are never padding their pockets with billing tricks but much of this is due to the hostile environment put on the system by lawyers, government and insurance companies changing the rules and demanding we jump thru hoops with no money to make it possible.

My father founded The Doctors Company. Google it if you like. Insurance worked well for many years before lawyers and government really fucked it up.


MachoMan's picture

You're complaining about the patients' payer source requiring you to perform additional tests on their insureds before you get payment for services?  This is a private matter between you and the insurance company.  If you do not want to jump through all the hoops imposed by the insurance provider, then I suggest you opt out or refuse to contract with them.  Good luck keeping up with your expenses, but this is your gambit.

After medical providers built monuments to the gods and made capital expenditures based upon ever increasing/endless insurance payouts, they are now impotent to reform (decreases in the cost of care).  The answer here is simple, but no one in the medical industry will allow it, due to self preservation, and no one in the remainder of our economy will allow it because virtually everyone is bootstrapped somehow.  This issue is no different than what has happened with student loans and tuition.  Albeit there are less convenient scapegoats for our education industry to blame.

PS, the number of lawsuits are simply a function of how many business transactions are conducted...  as the medical industry expands, so too do the lawsuits...  it's really this simple.

Miffed Microbiologist's picture

The government mandated the testing not Drs. They did not mandate the insurance companies to reimburse. I do not believe any private insurance would reimburse for this. However no Medicare reimbursement will be paid unless the hospitals prove a patient has not contracted MRSA while an impatient. Therefore Hospitals must perform the testing. The issue is with the government dictating requirements for reimbursement, not private insurance.

Obama care with its plethora of requirements will make this worse. Less and less reimbursement(which is now in many cases pennies on the dollar) coupled with a chronically ill population, will break the system. As with the student loans fiasco, if the government had never gotten involved, that trillion dollar disaster waiting to implode would not have occured either. I believe the government it ultimately responsible.


MachoMan's picture

Is medicare or medicaid private or state sponsored insurance?  You act like the legislature has just imposed some magical requirement, as if it is some island unto itself...  Ultimately, you are free to drop a payer source if you choose.  If the restrictions are such that you cannot turn a profit, then you have only one incredibly obvious alternative.

Again, you're complaining about reimbursement rates or the hoops you have to go through to bill a third-party payer source.  Let me put this a different way, if you had not built up a gigantic capital infrastructure and racked up debt in the process (just like academia), would you care as much about decreasing reimbursement rates?   Why are you entitled to continue to make profits in your business?  The fact that you can expect this ought to be a testament to why you should fail.  

This is part of the problem with america in general, no one wants to take any responsibility for having a hand in creating the present state.  No one can be honest enough and have humility enough to accept their role in the mess.  This is necessary before we can move forward with viable proposals.

PS, I'm guessing the legislative requirement was implemented to incentivize medical facilities to quit having rampant staph infection...  do you see any public policy reason for the new requirement or is it just another long list of incomprehensible bullshit the government has mandated to keep you down?  

Miffed Microbiologist's picture

My hospital is nonprofit. We operate under a very tight budget and are cost conscious. The " magical" requirement was a lawsuit claiming the death of a child due to MRSA was the hospitals fault due to lack of screening. No conclusive proof was presented that the infection was caused by the negligence of the hospital. The child ( who had multiple medical problems) died of MRSA during one of his visits.

You don't have to be patronizing to me. I am not unreasonable. But, I have watched regulatory increases massively increase costs. I have watched people die of infections normally not lethal. You would term this as medical negligence. I see it as a population mortally obese, chronically ill with glucoses regularly in the 500+ range that is the problem. Hospitals are just trying to survive in this environment. They did not create this. Guess what , under those conditions you will have rampant staph,MDRO GNR line infections and other opportunistic infections. Here is a frightening fact for you. Right now staph is living on your skin and in your body. Nosocomial infections do occur but the VAST majority are infections from opportunistic organisms found on the body.

So who is the guilty party not taking responsibility having a hand in creating this state? Or am I just too obtuse to see your point? I would love to hear your proposals that would solve these problems.


MachoMan's picture

So who is the guilty party not taking responsibility having a hand in creating this state? Or am I just too obtuse to see your point? I would love to hear your proposals that would solve these problems.

Well, I think your question begs a favorable answer.  I would pose the question a bit differently, so maybe we can get a different answer.  Regardless of who created fatass/shitty patients, who was responsible for building a business that cannot tolerate decreases in revenue (more specifically, who built a capital infrastructure around third party payments so large that the patients, i.e. real customers, couldn't possibly afford)?  I would hope that you could at least accept the fault in this business model or, alternatively, admit that the medical industry is simply a ward of the state.  [and I say this as someone who is actively helping medical professionals become independent again and get out of the way of the steamroller].  This is actually fairly similar to the situation the banks find themselves in due to too many years gaming the system and being dependent upon uncle sugar.

The solution to this problem is fairly simple: (1) declare the mandate to have health insurance as unconstitutional; (2) restrict health insurance to catastrophic illness and reduce/eliminate geographical insurance monopolies; and (3) expand consumers' ability to pull out pre-tax earnings to pay for medical expenses and/or increase the tax deductibility of medical services.  Obviously there are quite a few other measures that could help, but this ought to do a pretty good job of making a more direct connection between the patients receiving service and the payment of the service, which will have the additional effect of weeding out a significant amount of fraud.  Flushing malinvestment from the system is going to happen one way or the other, and everyone entrenched will fight it tooth and nail until the bitter end, but gravity always wins.



Miffed Microbiologist's picture

I could look favorably to item 2 and 3. Both of which had been used by myself for 20 years. We never carried health insurance until our catastrophic plan became so expensive ( our carrier was using it to fund other losing plans in the company. I personally would have premiums on the insolvent plan members but for some reason that was not done.) we would have relished a roll over HRA if we were allowed. We used our individual HRAs to pay for all of our basic medical expenses but unused monies were not able to be rolled over because we are employees and did not have a business. Had we have been able to have done this, we would have had almost 200k to use when we are older and more likely to need more care. The government, once again, has foiled our plans for seeing to our medical needs as well as retirement and, yes, I am resentful.

The malinvestment of which you speak would have no possibility of occurring without the obscene amount of money pouring in from government, via insurance or directly. This could not have any possibility of occurring in a fee for service scenario. Because we have reached an unsustainable situation where a chronically ill and aging population is demanding more technologically advanced, albeit more expensive care, the unwind will be painful. Believe me, where I sit, people are absolutely clueless how tenuous this system has become. Only recently have people become aware of national drug shortages in cancer therapies and surgery. I expect this to increase.

If everyone paid for their basic medical and used catastrophic insurance for those high cost medical events spread over a population, many of the problems would be solved. However, there are always those, especially now, who have no interest to taking responsibility for their own care. Here,IMHO, is a BIG problem that may be insurmountable unless draconian measures are imposed. This core issue no one will face and when it can be ignored no longer, it will be too late for an easy solution.


MachoMan's picture

In all of that, I still don't see any acceptance of responsibility on the part of the medical industry (or you in particular).  Yes, our monetary policy has distorted pricing mechanisms and sent false signals to many market participants.  However, you don't get to eat your cake and have it too.  If you accept the profits during the monetary policy fueled boom, then how can you possibly demand to avoid the bust?  Further, how much can you blame monetary policy for distoring pricing when it is painfully obvious that for many, many years patients cannot afford the care they receive?  There are plenty of objective markers along the way to tell market participants where they are...

There are plenty of medical providers who have been able to navigate these waters and securely position themselves in an inhospitable environment.  I hope that they will be able to reap the rewards if the government will allow malinvestment to be flushed.

As far as state sponsored insurance taking care of people who refuse to lead healthy lifestyles, that era will be coming to an end as well.  One thing we have learned is that if the government pays your way through life, it will expect to be able to dictate your lifestyle.  This coincides with the will of taxpayers...  if you steal money out of my pocket to pay for your healthcare, then the least you can do is quit smoking a couple packs a day, stop eating cheesy poofs, and get off your ass once and a while.  The remibursement rates are declining for these folks and the paperwork only increasing when you see them...  with the added risk of clawbacks from audits due to procedural nonsense.  The state is working towards dramatically reducing its obligations.

PS, have you gone to a few professionals to determine your ability to utilize the $200k as you see fit?  That's enough money to even get a second opinion...  my guess is that if you throw some money at it, you'll be able to find a way to get done what you want.  However, you'll need to find someone incredibly specialized to give you an answer.  In my experience, there is virtually always a solution.

Miffed Microbiologist's picture

We have seen several professionals over the 200k. No, living in CA there is no way for us to set up a roll over HRA unless we had a business. We had contemplated forming a bogus business to do this but the costs and time needed to keep it running were prohibitive seeing I work full time and my husband puts in 12-14 hr days. Yes we are unfortunately wage slaves professionals with relatively high incomes but are taxed to death. I have talked to a friend in Texas and he has told me what we wish to do could be easily done there. More reasons to move.

Personal responsibility? Where am I lacking this? I am paid a wage which is considered at the mean of the local going rate. My take home pay is well below the average wage of San Diego gross wages. When I first was licensed I made $9.48/ hr. At that time I could pay my bills comfortably. Now I struggle to do so even though I make 4X as much. So how have I benefited by this inflationary environment? Clearly those higher up have reaped more reward especially in administration and medical specialists. This is not my doing.I am not personally subsidized though my employer most certainly is considering I work for a non profit. This is no fault of mine. I did not authorize this nor voted for its implementation. My job description has changed to include more supervisory work. If I refuse to do it, my pay will be docked 8%. This work must be completed during work hrs and no overtime will be payed. So, I am actually being paid less.

If the medical field imploded and I were to be paid a fraction of what I made now, I would have no problem inherently with this scenario. However, because my salary in relation to the inflated society of which we find ourselves at the moment would not pay basic expenses such as gas to and fro from work, I would have to quit. Where have I indicated I would be against a bust? This is pure sophistry. A bust is assured and unavoidable, only the timing is an unknown. That you claim I am reaping awards of this system and pathetically wishing for its continuance is simply untrue. How am I to blame when others have far more motivation to keep the status quo?

What we have today is simply socialized medicine. Insurance works properly if it covers only catastrophic care, not routine health care. This worked well for us carrying a $7500 family deductible and using $6000/ year untaxed dollars for care. Now we have the cheesy poof crowd who use the ER for basic care and are on an average of 15 different meds to keep them alive. They probably constitute 75% of my work. Unlike any business, they cannot be turned away. Their care is mandated by the government. So if reimbursements drop are we then allowed to turn them away unless they have cash? No ticky no washy? This is how it is done in the Philippines. However, it is only fair if I pay the cost of care for myself and am not subsidizing Mr Cheesy Poof's or illegal alien's free care. I would expect this would be considerably less cost than what I pay currently.


MachoMan's picture

First, you keep talking about a non profit medical provider like it's some panacea.  I help create these types of entities, so I have a pretty decent ground level view of what goes on...  Practically speaking, there is not a shred of difference between for profit and not for profit entities.  Other than the latter are essentially free from scrutiny from virtually any regulatory oversight.  Yes, you file a 990, but other than that, you're pretty much left to do as you please until someone politically connected enough gets the regulators off their asses to investiate you.  Further, you often get immunity from suit to boot!  At any rate, the only legal difference is that a the residual profits from the nonprofit are not just outright distributed to shareholders (which is asinine considering for profit corporations do their best to hold onto profits anyway in tax avoidance schemes).  What ends up happening as a result?  The nonprofit just pays out administrators more on the front end...  same shit, different entity type.

Second, you're tap dancing around the issue and have done so for numerous posts.  Essentially, you began complaining that your patients' insurance demands that you pay for certain tests which, ultimately, leads to decreased profit margin (through an inability to pass on this cost to patients).  My point was that you (in this case, complaining about the issue from the side of a medical practitioner/medical industry) refuse to accept any responsibility for placing your business in a position that makes it difficult, if not impossible, to weather a financial downturn.  This was done despite an objective acknowledgment that the patient is patently unable to pay for the services at the price levels demanded from medical practitioners. 

During the boom years, medical facilities expanded to capture as much of the loot as possible, and thus expanded their legacy/fixed costs.  This is the same argument made by people whose houses decreased in value.  While housing (and the medical field) was going gangbusters [and medical still is for the most part], everyone enjoyed the spoils.  Those enterprising souls bought bigger and bigger and bigger.  However, now that the gravy train is coming to a halt, no one wants to face the music.

PS, you're telling me that you don't have enough time to keep up a bogus business, but you could probably pay someone less than $100/mo. to keep it up...  is there an hour requirement that you're dealing with?  I don't know any such requirement...  again, there is a way...  if you choose not to jump through the hoops, then that's on you, but there is a way.  You're telling me that you don't have enough time to run a shell organization, but that does not require any time.  Quit complaining and get the job done.  I promise you that there is a professional out there cashing in on what you're trying to do and has a playbook for you...  if he screws it up, then sue him to make yourself whole.  You agreed to deal with complicated legal nonsense when you contributed to the account and now don't want to face up to a complicated legal nonsense solution...  once they get your money, no one wants you to be able to withdraw it.  My suggestion is to protect your money.

Miffed Microbiologist's picture

I guess I'm going to have to tap out on this one. Not that I don't wish to continue this discussion because it is an interest of mine and I do look for real solutions out of the medical morass we find ourself in today. The issue is multifaceted and complex with many components.

However, giving out my email on line has resulted in many contacts regarding Ebola and I am inundated by the response. At this point, I wish to focus on this because of its relevance at this time but I didn't want to just not respond to you considering the amount of time you spent on this interaction I am sorry.

I certainly hope Ebola will not make our discussion moot. If not, perhaps we shall continue some time again.


Anusocracy's picture

You mean a made up right that allows you to do something to someone else in a government run system that no one has a right to establish in the first place.

Oh, that kind of imaginary right.

tmaynardr's picture

And the study uses outdated data, as most of it is pre-tort reform.  For example, in Ohio, the number of claims post tort reform has been reduced by 54%.  Why haven’t premiums gone down by a proportional amount?

LetThemEatRand's picture

Yes, funny how the tort reform push over the last decade or so has done absolutely jack shit to reduce insurance premiums even though claims have dropped substantially (meaning fewer people are able to seek compensation if they believe they were wronged).  But doctors and especially hospitals never screw up or design their practices as profit centers at the expense of patients, and insurance companies need more money so it's okay.

MachoMan's picture

Bingo.  Tort reform is actually just a push for tort immunity.  If you put tort reform into a historical context, the debate has been waging for centuries (millennia) and has changed dramatically over that time period, from one extreme to the other.  People act as though they're the first to suggest changes to the system, but they probably don't have the historical understanding to remotely understand what they're suggesting...  and why it's failed in the past.  Much the same as monetary policy...

In the end, with all its faults, the civil side of the legal system is the last meaningful, legal form of redress available for the average person.  People don't want to talk about this aspect of our society, but there is nothing the average person can do for redress against entrenched power other than fill a jury box of his peers and pass judgment on a multinational, local super star professional, governmental worker, or politician.  Whenever you pick up the torch to limit the availability of legal means of redress, ask yourself whose water you're carrying. 

Citxmech's picture

"Tort reform" is the propaganda arm of the insurance lobby.  They've been very successful too.  "Frivolous" lawsuits are least of our legal system's problems.

Oh yeah - and all those insurance premium savings we were promised ended up in the pockets of the boards of directors.

MachoMan's picture

Bingo.  A fair question for our state legislatures is why, in a highly regulated industry such as insurance, did they not mandate decreases in premiums along with providing decreases in tort liability?

Citxmech's picture


My guess is because the insurance lobby wouldn't have contributed to any campaigns that signed-on to legislation with that kind of language!

MachoMan's picture

Bingo.  Now we're getting to the meat of the coconut.  This is what our society is...  people don't want to actually utilize the process of political debate to determine the best course of action, rather it is simply a procedural necessity prior to counting up the money of opposing sides.  Needless to say, it seems like all who demand tort reform are either ignorant of the fact that tort reform is a constant in our system and has been happening for centuries, or are ignorant of how limiting citizens' ability to redress grievances against the politically entrenched might not be the best course of action, in other words, they simply don't understand the philosophies underpinning torts in the first place and the role tort suits have played over the centuries...

Citxmech's picture

What I don't understand is where are all the libertarians on this site who supposedly support the right of legal regress as the primarly enforcement mechanism for individual rights as opposed to big govt?

MachoMan's picture

If you could get the majority of people to have consistent political beliefs (or any beliefs for that matter), then you could die the most accomplished man in history.

teslaberry's picture

what are you fucking joking me?the fact that you say THE WHOLE ISSUE INSURANCE COMPANY PROPOGANDA-------SHOWS HOW MUCH OF A FUCKING MORON YOU ARE. 




however; to addresss your point, and to begin demolishing your argument. 

as a lawyer who has a family friend who is a neo-natologist, you have no fucking clue waht you are talking about when you say there is no crisis.  there is indeed a crisis. a crisis that ratchets up the inevitable full institutionalization of an entire industry ( medicince) to the private benefit of NONindustry profiteers including-----malpractice insurance , MEDICAL insurance, wall street , and other financial profiteers that have little to zero to do with the actual practice of medicine.

if there is any problem with this article's point about the malpractice crisis---it is that the article does not give even close to a holistic over-view of WHY THERE IS A CRISIS. I'm not going to bother going into it. 

however, i will point out that the article is pretty simpleton bullshit obvious truth. yes, there is a crisis. there has been a crisis getting worse for some time now. and it's particularly bad in medicine, but the crisis is eating away at the heart of american in many other places. 

the cost of insurance drives up the cost of PROVIDING WORK. so employers either compensate employees more ( driving up the costs of the products or services they sell, and or employees slowly go broke.---BOTH OF WHICH ARE ACTUALLY HAPPENING TO DOCTORS THROUGHOUT THE MEDICAL 'INDUSTRY')

insurance kills everything it touches very slowly like a python, slowly ratcheting up the suffocating costs of the over-head of doing business. the insurance industries are a complete and utter scam that are OPENLY BAILED OUT AND TAX SUBSIDIZED . IT IS A RAQUET INSIDE ANOTHER RAQUET .

the medical industry has had such an accute crisis with this, that there are no longer new doctors practicing independently in the united states. new doctors out of med school are herded into their institutional jobs like cattle to a cattle car. they know not the original history of medicine as an independent profession where a man could make a living by saving lives and treating patients. 

if you think this isn't a crisis, the lack of INDEPENDENT DOCTORS. then i'm sure you also believe that unionizing lawyers is a good thing to. i'm a lawyer. lawyer pay in new york is so low and job security so shitty that i frequently hear lawyers talking about 'unionizing'. it is some serously outrageous shit. and yet, some people in fact do take it seriously. unionizing for what? lawyers and doctors already have guilds to protect their independent interests as professional independent practitioners. what happens when there is no more economic or political room for them to practice indpedently and they are forced into large institutions such as massive hospitals and huge ass coglomerates of small lawfirms that provide services for people with 'lawsuit insurance' -----you eventually get what you get in the soviet union. a fully beauracratized society. 

many of the former beauracrats of the soviet union literrrally die or become homeless with the collapse. but doctors, WELL DOCTORS ARE ACTUALLY USEFUL , AND THIS IS WHY YOU SAW SO MANY RUSSIAN DOCTORS DRIVING CABS IN NEW YORK CITY IN THE 80s and 90's. 


this is indeed a crisis for our civlization and your petty remark about a 1% claims rate is like republican propoganda ( an i'm republican) --------about how the rich pay all the taxes. it is lies lies lies lies and half truths meant to decieve. but in your case. youre probably just dumb and have no clue about how the system actually works and are spouting off someone else's propoganda. i only say this because your reading comprehension skills are so poor. 


Dr_Dazed's picture

Wow - that was an incoherent rant.  Having a bad day?  What law school did you say you attended?

Dr_Dazed's picture

Wow - that was an incoherent rant.  Having a bad day?  What law school did you say you attended?

Dingleberry's picture


You forgot to mention the 15-20% of the entire medical bill that is related to practicing defensive medicine.

Everyone bitches when the doc makes you get a bunch of lab tests/scans, etc and it costs a bunch of money.

That's because litigious liberal fuckers (like you) want something for free.

The rest of the world (you know, the ones who you want to emulate with socialized medicine) does not have lotto-style lawsuits.

Why do we?

Oh, and if 80% + of lawsuits are thrown out...what does that tell you about the system? I's unfair. Maybe if we got "loser pays" (again, like some other socialist paradise you seem to revere) then this bullshit would stop. 

But I guess we should pay to keep legions of lawyers on retainer for bullshit lawsuits.  It doesn't cost much, right? 

Citxmech's picture

Where are you coming up with this "80% of lawsuits are thrown-out" statistic?

MachoMan's picture

Further, where is he coming up with the legal lottery notion?  I'm guessing he doesn't actually see what the vast majority of these cases are actually worth...

Trogdor's picture

This isn't just an "individual-sues-the-big-guys" situation, it happens the other way around, too.  Movie producers, directors, the MPAA, and RIAA, have been using the SAME disgusting techniques to soak tens of thousands of people for what is essentially "protection" money - i.e. pay us $1500-3000 and we'll go away - or we'll drag you through the court system at a cost of hundreds of thousands.  The scam works like this: they will collect IP addresses of people who *supposedly* downloaded some kind of content (it's impossible for them to tell if the IPs were spoofed, or, if the individual actually downloaded all the content, or the ID of the computer that supposedly did it, or if someone's wifi was hijacked, etc), then they will find a compliant scummy judge whom they can pay a few thousand to that will allow them to put upwards of 4000 individuals on a single subpoena - to avoid the $30/per subpoena charge, of course.  Then, the typically Jewish law firm will mail out mass "threat letters" all across the country.  What they do is make sure that the "payoff" amount is *slightly less* than it would cost for a person to go through the bullshit to prove themselves innocent - i.e. forensic analysis of their computer, court time, hiring a lawyer to speak to the filth making the charges, etc.  Most people just have to pay - which is of course what they want.  Millions in profits for just sending out a letter.  My neighbor is an older gentleman - he barely uses his computer, but that didn't stop a slimy DC Lawfirm from threatening him and managing to extort money he really didn't have. Nearest I can figure is that his wifi was hijacked - but that didn't matter to the greedy POS lawyers or the slimebag judge who allowed them to break the law.

The "legal" system is an obscene, sick joke - it's just as black-slimy-rotten inside as our political, corporate, and banking systems ... which really shouldn't surprise anyone at this point.

MachoMan's picture

It's probably important to distinguish between the legal system and the bullshit laws (in your example, copyright statutes) that the legal system has to hold its nose and deal with...

New World Chaos's picture

Nobody "has" to hold their nose and deal with anything.  What is someone going to do, impeach a judge for improperly throwing out or ignoring a bunch of bullshit infringement cases?  Even if there are consequences, people are still morally responsible for their actions even if "it's the LAW".  That's no excuse for robbery.  So don't be a party to bullshit.  God gave us a soul but so many people willfully throw it away and become zombies.