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Keynote Address
OTIS R. BOWEN, M.D.
The growing cost of medical mal-
practice insurance and the impact it is having on people's access to
prenatal care and delivery services is a problem of profound importance
to this country.
~ want to thank the Institute of Medicine for its leadership in attack-
ing this problem. In doing so, it is building on the work of a U.S.
Department of Health and Human Services (HHS) task force ~ convened
a couple of years ago to investigate the impact that growing medical
liability and malpractice costs are having on people's access to health
care. That task force discovered that the hardest hit of all medical
services was obstetrics.
From 1982 to 1985 the average malpractice insurance premium for all
physicians increased by 81 percent, whereas rates for obstetrician-
gynecologists shot up 113 percent. A growing response of obstetricians
and family physicians to these skyrocketing premium costs has been to
curtail or omit delivery services altogether. Just last year the American
Academy of Family Physicians reported that 18.6 percent of its mem-
bers have dropped their obstetrical practice, giving as their reason
either liability insurance costs or an inability to get malpractice insur-
ance.
Obstetrician-gynecologists (ob-gyns) in particular also fear malprac-
tice suits—and small wonder. More than 73 percent report that they
have been sued at least once. Verdicts or settlements for obstetrical cases
can be in the million-dollar range, a figure that does not even count the
hefty legal costs involved.
1
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2 MEDICAL PROFESSIONAL LIABILITY: VOLUME II
These factors in turn have helped to send insurance premiums soaring
for ob-gyns. A survey conducted by the American College of Obstetri-
cians and Gynecologists showed that the average premium for their
members' liability insurance went from nearly $11,000 in 1982 to more
than $37,000 in 1987—more than a threefold increase.
Two groups of patients have felt the greatest impact from these
changes: those living in rural areas and those with low incomes living in
the inner cities. A physician has to deliver about 40 babies nowadays
just to cover the cost of one year's malpractice premium, but the fact is
that many rural doctors are not called on to make that many deliveries.
With family physicians often the only ones to serve an area, numerous
counties or entire regions of some states report that they have just one or
two physicians to deliver babies.
Informal surveys tell this story all too well:
· By early 1987, Arizona's rural counties reported a 30 percent drop
in obstetrical providers during the previous three years.
~ In Alabama, 300 of 441 family physicians responding to a 1986
survey had stopped practicing obstetrics.
~ In Mississippi a survey of family physicians was no more reassur-
ing: in 1985, 35 percent of them included maternity care in their prac-
tice; by 1987, the number had fallen to 14 percent.
· A Texas Medical Association study in 1987 found that 69 percent of
all Texas family and general practitioners had limited or eliminated
some of the services they were providing; 37 percent had discontinued
their obstetrical practice altogether.
Another group of maternity care providers has also been hard hit by
the increases in malpractice insurance rate~those who serve in feder-
ally funded Community Health Centers. These centers serve Medicaid
recipients and other low-income patients in medically underserved
rural and inner-city areas. A significant part of their service is mater-
nity care. These centers face increased liability insurance costs because
so many ofthe young women they serve are at special risk. Having to pay
higher rates puts these centers in a particularly tight financial bind, for
two reasons: (1) they cannot pass the increased cost on to their low-
income patients, and (2) there are limits on the federal funds they
receive. Some states have increased Medicaid payments for maternity
care, although nearly all such payments remain far below physicians'
usual charges and private insurance rates.
All of these problems stand in the way of the special initiative the
HHS has under way to drive down infant mortality rates in this country.
This initiative was undertaken because the steady decline in the na-
tion's infant mortality rate showed signs of slowing down. (As a nation
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KEYNOTE ADDRESS 3
the United States' rate is still well above those of many industrialized
countries.) In fact, there does not appear to be any change in the inci-
dence of low-birthweight babies; there has even been a slight increase in
the percentage of very low birthweight infants.
There is even less room for optimism in another key indicator: the
percentage of women in the first trimester of pregnancy who are receiv-
ing prenatal care. We found no increase in this percentage. ~ need hardly
elaborate on how vital early prenatal care is to driving down infant
mortality rates. It is, quite simply, a key to all our efforts and offers us
the best hope of success.
Much credit has been given to the development of neonatal intensive
care units in the overall effort to save infants born with life-threatening
conditions. The men and women who work in these units deserve our
highest praise for their lifesaving work. They are writing a lustrous new
chapter in the annals of medicine. Still, as we give these heroes our
praise, there is a point to be made that they would be among the first to
assert: neonatal intensive care is frightfully expensive. Bills of $30,000
and more are not uncommon in an effort to save a single infant. Even
when the infant is saved, it very often faces an uncertain future with
considerable impediments to its health and functioning. Saving infants
to live a life of nearly total dependency poses agonizing choices for
parents and sometimes puts them at odds with the men and women of
neonatal intensive care units whose jobs are to save infants' lives.
All of these factors drive thoughtful people to reflect on how much
better it would be to ensure that all pregnant women received high-
quality prenatal care, which can often help to avoid these agonizing
choices by ensuring that fewer infants are born with intractable, life-
long medical problems. A $30,000 neonatal intensive care bill could
easily cover the costs of high-quality prenatal care for many women
throughout their pregnancy. In a nation like ours, in which soaring
health care bills are a problem all their own, this is no small considera-
tion.
The blunt fact is that this country must find less expensive ways of
ensuring the good health of its people or face the dismal prospect of a
health care system in which the voracious demands of high-technology
medicine will preempt the nation's capacity to provide access to care for
increasing numbers of its people. Some 37 million Americans today are
without any financial coverage for their health care. At least 17 percent
of women in their childbearing years have no insurance at all, and
between 11 and 12 million children are without health insurance cover-
age.
If we are to reverse this dangerous state of affairs, we simply must find
ways of ensuring sound health care for more people at an affordable cost.
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4 MEDICAL PROFESSIONAL LIABILITY: VOLUME II
We can only accomplish that goal by redirecting our health care system
so that it puts greater emphasis on low-cost prevention rather than high-
cost technology.
~ am not an enemy of high-technology medicine. The danger ~ see
today, however, is that high-tech medicine will become its own worst
enemy. If its cost becomes too high, we will see public and private
insurers putting arbitrary restrictions on its use. That kind of action is
rationing, and we certainly do not want that. We want a system that
uses the technology that is most appropriate to the individual situation,
but there is absolutely no hope of achieving that desirable state of affairs
if physicians keep dropping out of maternal and obstetrical care.
Two of our chief enemies in this instance are fear and ignorance.
Physicians fear being sued, and the system lacks the knowledge it needs
to defend physicians from suits that are based more on emotion than on
fact. Physicians feel themselves to be at the mercy of juries of nonmedi-
cal people whose sympathies may often rest with parents and babies. To
counteract this all too human tendency, physicians need a body of widely
accepted knowledge about what constitutes legally defensible obstetri-
cal practice.
Unfortunately, no such body of knowledge exists. We urgently need
data that will allow us to see more precisely the relationship between
what course of treatment or procedure the physician elects and the
likely outcome for a mother and her infant.
The department's National Center for Health Services Research and
Health Care Technology Assessment is at work on this problem on a
broader scale. Researchers there believe- and ~ agree—that carefully
selected studies of patient outcomes can offer us two considerable advan-
tages: (1) they can improve the quality of patient care, and (2) they can
serve to reduce unwarranted malpractice suits.
The final report of my Task Force on Medical Liability and Malprac-
tice set forth six important public policy issues that research can help us
resolve:
· First, we need to know the frequency of adverse medical outcomes
and how we can distinguish between avoidable and unavoidable results.
~ Second, we need to know the relationship between physician prac-
tice patterns and malpractice claims. In this regard a national data
bank being set up by HHS will give us information on malpractice
claims and licensure actions, as well as permit interstate comparisons.
~ Third, we need to know what kinds of actions are effective in
preventing substandard practices among physicians. I am referring to
such mechanisms as state licensure boards and the work of peer review
· —
organizations.
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KEYNOTE ADDRESS 5
· Fourth, we need to know how the quality of care is affected by
hospital risk management programs, the practice of defensive medicine,
and the use of innovative medical technology.
· Fifth, we need to know how effective various tort reforms are in
stemming the tide of malpractice suits and what many regard as exces-
sive monetary settlements.
· Sixth, we need to know more about the insurance system itself.
What factors are at work in the industry that affect the cost of profes-
sional liability and insurance underwriting practice?
The studies will help us find answers to these important policy ques-
tions. For example, HHS has a research program mandated by 1986
legislation that is looking into variations in medical practice. It is
designed to provide clinicians and those who buy health care with the
costs and value of alternative practices and procedures. In addition the
Public Health Service has convened an expert pane! on the content of
prenatal care. These kinds of efforts can help tell us what is appropriate
medical practice today and what is not. To the extent that they do, they
can help reduce our reliance on the courts to solve issues of medical
malpractice.
That about concludes my remarks, except for one thing: there is a
tendency at times to think that Washington has all the answers to our
society's problems. The simple truth is that Washington did not create
all of the problems and it is not going to solve all of them. ~ believe the
federal government has a role to play in the issue before this symposium,
but I believe that others among us have equally important roles. This
symposium is in fact a simple acknowledgment of that view. Other
professional organizations in medicine have a stake in this question, and
they have become involved in the quest for answers. The states have
entered the arena, too. When I was governor of Indiana, ~ helped steer to
passage medical malpractice legislation that has made a significant
dent in Indiana's problem. Other states have also acted. A few have
addressed the specific problems that rising obstetrical malpractice rates
have brought on them.
· Virginia enacted a Birth-Related Neurological Injury Compensa-
tion Act in response to a statewide crisis in the availability and cost of
insurance for obstetricians.
· Missouri now has a law requiring the state to cover malpractice
awards against physicians who provide obstetric and pediatric services
in public clinics.
· Hawaii has created a state fund to help cover liability insurance
premiums so that those who provide obstetrical services will be induced
to practice in underserved areas of the state.
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6 MEDICAL PROFESSIONAL LIABILITY: VOLUME II
We must each continue to do our part to solve this problem—or I
should say "problems," because what we are facing is the result of many
factors that will demand many kinds of solutions. Above all, we must
share with each other our findings and perspectives. Viable, long-last-
ing solutions will be found only when all of us work together govern-
ment at all levels, medicine, the legal profession, and the insurance
industry- to get command of the facts and find out what really works.
This symposium is a good step in that direction and now, let its real
work begin, for the children's sake.
Representative terms from entire chapter:
family physicians
