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Costly obstetric claims hit insurers

Posted On: Feb. 3, 2019 12:00 AM CST


Childbirth-related medical professional liability claims have traditionally been a major problem for health care institutions and physicians, but better risk management is helping to reduce their impact, experts say.

Obstetric-related events are the fifth-largest category of medical professional malpractice claims and the fourth-highest category of indemnity payments, according to Boston-based professional medical liability insurer Coverys.

They account for 4% of claims and 8% of indemnity paid, according to an analysis published by the insurer in January.

Valentina Minetti, London-based focus group leader for U.S. hospitals with excess insurer Beazley PLC, said that while obstetrics risks are just 14% of total claims for Beazley’s large hospital clients, they account for 38% of claims that total more than $1 million, and 46% of claims above $10 million.

“Plaintiff attorneys have a greater tendency to take obstetric cases because there’s a greater value” to them, said Bradford J. Hinshaw, a medical malpractice defense attorney and partner with Hinshaw, Marsh, Still & Hinshaw LLP in Saratoga, California.

There may be a claim for a maximum of $250,000 if a 75-year-old man dies, but if it’s a catastrophic birth injury case and the infant could survive a number of years, the baby would require close to a million dollars of medical care annually, he said. “That case has an extremely high value, so a plaintiffs lawyer is willing to take on a little more risk,” said Mr. Hinshaw.

His strategy is to “hire great experts on standard of care and causation” and “do everything you can to persuade plaintiffs counsel that if they take it to trial, they’re probably going to lose,” or be awarded lower damages than what they were seeking, said Mr. Hinshaw.

Of the claims closed by Coverys, 24% involved the death of the baby, mother or both.

“These are relatively rare events, but these are often high-tragedy events,” said Robert Hanscom, vice president of business analytics for Coverys and a co-author of the report. “Whether it’s fetal death, maternal death or permanent fetal impairment, these are terrible, terrible cases. The issue for us is that many times we don’t see the negligence in these cases. We see a very, very bad outcome and we defend these cases vigorously because we don’t think the physicians were negligent.”

Over the years, though, health care risk management has improved, said Steve Kahl, Denver-based senior managing director for Arthur J. Gallagher & Co.’s health care practice.

There have been improvements in techniques, training in anesthetics, policy procedures on how teams work with patient handoffs and communication with families, he said.

“Risk management is key,” he said. Involvement when something goes wrong, and proactive attempts to mitigate exposure when there is an adverse event, have improved care for countless companies, he said.

“That doesn’t mean we don’t still see the significant lawsuit where there has been a failure in the delivery of care, or there has been a system breakdown in communication where the mother or the baby or both have had some level of harm,” he said.

“I think that’s when we get concerned, because that typically means there could be some very significant payout due to an adverse outcome,” he said. “But I think our clients have gotten much better at keeping the family in the loop, communicating what they know when they know it, rather than sitting back and letting the patient get agitated because they don’t have answers. If the health care system or the practitioner has those protocols in place … it really does defuse the situation quite well.”

Darrell Ranum, Columbus, Ohio-based vice president of patient safety for The Doctors Co., which suggests its physician policyholders follow the clinical guidelines of the Washingtonbased American College of Obstetrics and Gynecology, said over the past 10 years, the trend line of maternal injuries is down, “so we think physicians are doing a better job.” 

Ken Felton, Charleston, South Carolina-based senior vice president for national health care practice with Willis Towers Watson PLC, said that to manage risk, organizations should use “evidence-based care bundles,” which involve three to five processes performed collectively to improve patient outcome.

Its applicability in obstetrics includes competency training for fetal heart rate interpretation.

“Depending on the competency of individuals, they can come up with different conclusions based on their review of a fetal heart rate,” said Mr. Felton. “This is where you can find indications the fetus may be in distress” and implement measures to address the risk more effectively, he said.

Virginia Jones, Chicago-based associate director and actuary for the U.S. with Aon PLC’s actuarial and analytics unit, said, “The frequency of these types of claims has probably stabilized in recent years, so I do think a large number of clients” have put a lot of emphasis into their risk management efforts. “I would have to imagine there is some correlation there,” although there is no data to directly support that, she said.