Sunday, August 30, 2009

Health Insurance and Tort Reform

Wade Coye, Insurance Lawyer
No question about it, as the the debate on national health insurance continues, we are beginning to see that tort reform as envisioned by business interests will occur and that it will be part of a package on universal care. It does not seem to matter whether people are politically tuned to the right or the left everyone has their own sacred cow in the fight. The left wants universal coverage and doesn't really want to look at the cost nor even consider that the Massachusetts attempt was far more expensive than anyone really imagined. The right thinks that the free market will correct all problems and doesn't want to consider that there is no real effective competition in the health insurance market.

For a deal to emerge in the Congress on a matter that the President views as critical, some old fashioned horse trading will occur. On the left, they will concede on tort reform to pickup some votes on the right. The tort reform will likely consist of some protections for doctors and hospitals who stand to receive less payment for providing care. This will likely satisfy some on the right and will be the basis for the votes necessary to ensure passage of the bill.

In the end who will really benefit? First, there is no question in the short term those who currently do not have health insurance will have an ability to obtain it easier than ever in history. This will be touted as a great achievement in human affairs and will make great campaign rally speeches. Doctors and hospitals will receive less for the care they give and should receive substantial reductions in medical malpractice premiums since with additional protections they will either no longer need the types of coverage or insurance companies will charge substantially less for their premiums.

Unfortunately it will not work. The cost savings touted from medical malpractice reform essentially occurs in two areas. First the lower premiums for insurance. That seems a bit unrealistic to think that an insurance company which makes substantial profits on professional liability insurance is going to suddenly give away a product. Nevertheless there will be some savings. But since it is estimated that medical malpractice insurance and claims is less than 2-3% of total healthcare spending, then likely this will not amount to much if any savings. Still a savings nevertheless.

The second area of savings from medical malpractice tort reform is supposed to come from a reduction in the amount of unnecessary testing. The discussion goes something like this: doctors have patients who will sue them over poor outcomes. So the doctor, in an effort to protect themselves and the hospital, orders unnecessary tests for these patients. The idea being that this is an enormous cost and we will have an incredible savings if you no longer have to give these unnecessary tests. It sounds great, except no one really has any decent numbers about what savings will actually occur. More to the point: is this unnecessary testing? Again, I am not so sure. First, to whom is the testing unnecessary? The doctor or the patient, or perhaps the insurance company? If you go to the doctor and there are a number of tests that can be run on a given condition, who is willing to take the chance? Understanding the logic of the doctor, you would have to think that there was some medical necessity. I cannot imagine any doctor indicating that they were ordering unnecessary tests in any one particular case. In fact, in my professional practice I have never even seen an insurance doctor go so far as to state under oath that another doctor was ordering tests that were medically unnecessary. (That would be insurance fraud.)

Most people will not decline a test especially if they don't have to pay for it out of their bank account. So then who makes the decisions? The doctor? Probably not going to happen. How about the hospital? Again, probably not going to happen. How about the insurance company, or better yet the government? Now you get the idea. The fact is you only get cheaper care when someone either gives the care to you cheaper than they were before or if you get less care than you would have normally. Doctors get paid less, hospitals get paid less, and the quality of the care goes down.

So the reality is that while more people will receive more primary care and more people will receive emergency type procedures that will get paid for, it is far more likely that some will not obtain care that they would have otherwise received (those tests that were "unnecessary.") Sometimes that is not necessarily bad, especially when you consider some of the shocking examples of people receiving outrageously expensive procedures that have little prospect of succeeding. Except and unless you were the one that wanted to have a chance. Sometimes people having choices even when they are not great choices serve everyone better. That is the system we have and I think the system we should keep.

Tuesday, February 17, 2009

The Ugly Truth About Florida Auto Insurance Requirements

Wade Coye, Accident Attorney
The ugly secret about Florida car and truck insurance is the minimal amounts required by law. Did you know, for instance, that you are required to insure yourself from injuries that you sustain irrespective of whether you or another person are at fault? The Florida no fault law requires each person who owns a car to carry $10,000 in personal injury protection insurance coverage. No doubt this coverage helps with minimal lost wages and medical bills, but does nothing in a more serious case. Particularly since the hospital bills alone can eat up the entire amount of available personal injury protection coverage. Even more incredible is that you are required to carry damage insurance to help pay for any property damage that you may cause when driving your car. It would seem a bit odd that you have to carry insurance to pay for another persons car damage but nothing for damage to anothers person, but that is the sorry state of Florida law.

A substantial number of people who move here from other states are shocked when they discover that the minimum required insurance does not mean you have to carry bodily injury coverage much less uninsured motorist coverage. This often times leads to difficult circumstances when we try to help someone who needs to make a claim for injuries they have sustained due to the negligence of another driver. Typically the problem is too many medical bills and not enough insurance, in no small part because there was not any bodily injury and or uninsured motorist coverage. This is why it is very important that you use whatever available health insurance, medicare, medicaid and or champus benefits to pay for medical bills even if someone caused or contributed to an accident or injury that you have sustained. If you use these resources, at the very least you will have paid most of your bills. In some cases it is important to reserve personal injury protection benefits to allow you to receive some wage loss benefits prior to benefit exhaustion. A common mistake made at hospital rooms and doctors offices is to insist that the defendant driver of another vehicle will pay all the bills. It is better to consult with a lawyer who can direct you on the options to get your bills paid while you work through the difficult circumstances of an accident or injury.

Sunday, February 1, 2009

The Big Lie About the Economy and Lawsuits

Wade Coye, Insurance Lawyer
I'm sure you have heard it. "People bring more lawsuits when the economy is bad so we need to limit lawsuits, so the economy will get better" Or some variation on this theme. The veiled insinuation is that people manufacture lawsuits because they have experienced some type of economic decline so are more willing to sue businesses and people for reasons other than some harm caused that is attributable to a particular defendant. Comments such as this are inaccurate at best and at worst are a lie created to develop protections from our legal system. If you think about it, how could you have more job injuries when less numbers of people are working and how could you possibly have more car wrecks when people are not driving. The answer is: you can't. A close check of on the job accidents and car wrecks reveals that both numbers drop during recessionary times. Unfortunately misguided statements such as this become cannon fodder for extremist groups who seek to limit a persons right to go to court when damaged.

Economic declines affect lawsuits, but not in ways that are commonly suggested in the media. For instance, if someone is injured in a car wreck and has already lost a job and benefits such as health insurance, this person and their family may have incurred hospital and doctor bills that remain outstanding, which, while perhaps ultimately the responsibility of the defendant, nevertheless contribute to increases stress for the injured person and ultimately requires the payment of higher damages by a defendant. Because health insurance typically pays medical bills at a previously negotiated lower reduced rate, the total outstanding bills paid for damages to a person are therefore lower when a person has health insurance. An uninsured person who is injured has a claim that necessarily requires payment of more bills than a person who has some form of insurance.

When people don't have a job, there are many consequences and the impact is felt in many different ways. But people do not file lawsuits and pursue legal matters because they want to or because they think there is going to be some type of a payday. Lawsuits are filed because a person or corporation was negligent and someone was damaged. Our legal system provides one of the best ways to resolve disputes about liability in our society and efforts made to eliminate this right do not promote justice and fairness.

Thursday, January 1, 2009

A New Sheriff in Town

After nearly a decade of minimal regulatory oversight and most favored industry status, the Florida insurance companies are quickly learning that Governor Crist & Company will not tolerate bad behavior. The recent conflict in Tallahassee between the Allstate Insurance Company and Florida Insurance Commissioner Kevin McCarty has all the trappings of a classic showdown in the old West between the new Sheriff who promises to clean up Dodge and the entrenched railroad and cattle barons who want business as usual.

The insurance industry could do no wrong during the entire Jeb Bush tenure, which may have led Allstate to believe that it no longer needed to comply with the rule of law. This all changed with the move to require insurance executives to testify under oath and to produce key documents pertaining to its anti-consumer, predatory corporate practices. Who knows where this will lead. Likely increased governmental regulation and a return of consumers having an open door to governmental leaders. But will it lower rates? Likely not.

One thing is clear, there's a new Sheriff in town and he has willing deputies who are committed to cleaning up Tallahasee. The time has come for a balance between the rights of industry and the rights of consumers.

Will Nationalized Health Insurance Eliminate other Insurance?

Wade Coye, Attorney
Any discussion of universal healthcare necessarily requires inquiry into the types of insurance that already provide some level of care for a person's health. For instance, many people access healthcare through health insurance that is paid for by tax dollars already: federal, state, and local employees, medicaid, medicare, federal workers compensation, and military benefits such as veterans benefits. In the private sector people receive health care from individual and employer sponsored group health benefits, workers compensation policies, auto no-fault policies and other accidental and health policies. Some of these policies pay based upon specific conditions and some pay for health care no matter the situation.

All of the above pay for much of the care that is obtained in this country and is necessarily something which bears significant consideration in a discussion of so-called universal healthcare.  Each of the above has overlapping and duplicate coverages for some, and for others is the sole financial resource to obtain healthcare.  The funding for the different types of coverages are paid for by a combination of state and federal regulatory frameworks, compensation plans, and tort liability. No discussion in the national media has completely reviewed these issues or the likely effect that universal healthcare will have on the existing means of obtaining medical treatment.