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Admitting fault up front saves money long term, study shows
By KERRY L. SMITH

   To err is human, but to voluntarily communicate that error to grieving relatives after a medical procedure has gone awry - rather than heeding the hospital attorney's advice to close the books and avoid the questions - has proven to pay dividends in the form of reduced anger and much lower financial settlements.

   So says Dr. Steve Kraman, author of a model used by public and private hospitals across the country for 16 years. Kraman convinced the first hospital to test his theory in 1988, when he was chief of staff at Lexington, Ky.'s Veterans Affair Medical Center.

   The premise: If a physician unintentionally causes a drastic patient outcome, rather than leaving the patient's family in search of answers and ultimately punitive malpractice-related damages, that physician and a supportive hospital should initiate honest communication with the family as to how and why the grievous error occurred - offering a fair financial settlement and bringing closure rather than allowing the case to go to court.

   Is this a scary pilot program for the medical community to try? Maybe, said Kraman, but the alternative - huge court settlements and black marks on the physician's record, both of which can lead to skyrocketing med mal premiums - is scarier.

   "In 1987, we put together a risk management program because our hospital had lost a number of large medical malpractice cases and it was pretty clear we didn't have the capability of defending them," he said.

   Kraman helped the hospital develop a process of investigating bad outcomes.

   One year later, a patient death occurred and lab tests contained strong evidence that it had been a negligent death. By then, he said, the family had taken the body and wouldn't have known.

   "We called the family and shared our knowledge with the victim's two daughters and their attorney," he said. "The physician and the hospital apologized, we provided detailed information as to how and why the error occurred, and we said we'd like to negotiate an amount. Within about a month, we came to an agreement on a fair amount, we paid for it and that was the end of it."

   After 10 years of the program's operation at 35 VA hospitals nationwide, Kraman studied the economic impact. What the Kentucky physician found was startling, he said.

   "In 16 years, we only went to trial three times. We got our share of frivolous lawsuits and frivolous claims, and we defended those aggressively. It helped that the federal judges in our area knew what we did and were confident that we were honest. We were very successful in getting the frivolous cases thrown out of court," he said.

   The average up-front malpractice settlement amount of the 35 hospitals studied, was only $16,000. This figure, he said, can be compared to the average court settlements and judgments the same hospitals had been paying prior to adopting his model. An average of $98,000 was paid in pre-trial settlements; $250,000 was paid in settlements at trial; and $450,000 was paid, on average, in cases that went to trial and the plaintiff won.

   A VA hospital case goes before a judge, not a jury, Kraman said, meaning that these numbers could be even larger for private hospitals.

   Kraman is speaking with the state of Illinois about adopting the model in a pilot program involving four hospitals here.

   "Illinois Attorney General Lisa Madigan's office is drafting legislative language as we speak," said Doug Wojcieszak, spokesman for Victims and Families United, a grassroots Metro East-based patients' rights coalition. Wojcieszak lost a brother to medical error.

   The language will be given to a 14-member, bipartisan ad hoc committee of state legislators, he said, with the hope that a bill can come out of regular session before its close on May 21. He said the state would need to step forward and guarantee a financial "safety net" for participating hospitals and physicians, in case the doctors were sued despite their up-front efforts.

   "When my brother died, my parents wanted answers and they wanted accountability," he said. "Hospitals' defense lawyers swoop in and tell everyone involved, 'Don't talk and don't have meetings, because meetings create notes.' Apologizing is important. And when patients and families know the system has been changed so it won't happen again to someone else, it goes a long way toward closure."