The 2nd meeting of the Subcommittee on Technology of the Blue Ribbon Panel on Public Employee Health Benefits was held on Thursday, June 16, 2005, at 9:00 AM, in Room 113 of the Capitol Annex. Senator Daniel Mongiardo, Chair, called the meeting to order. The secretary called the roll after the meeting had begun.
Present were:
Members: Senator Daniel Mongiardo, Chair; Senator Tom Buford, Carol Carman, Michael Mayo, and Jim Sproul.
Guests: Alison Preston, UK; Melachi Schrader, M. Schrader & Associates; Shawn Sparks, KRS; John Wilkerson, KEA; Rebecca Pehlke and Debbie Lopez, Medical Protective Insurance Company.
LRC Staff: Karen Powell and Marlene Rutherford.
At the outset, Chair Mongiardo advised that the meeting was informal to gather as much information as possible and that anyone not on the agenda that would like to address the committee to feel free to do so on information technology, medical malpractice, and medical errors.
The first part of the meeting related to information technology and health care and the direction the state is headed, as well as nationally, to try and overhaul an antiquated health care delivery system. The second part of the meeting addressed medical malpractice to determine if there is any action that can be recommended to address the issue.
Chair Mongiardo indicated Senate Bill 2, passed by the 2005 General Assembly, is basically a two-pronged approach for a statewide e-Health network to connect all doctors, physicians, health care providers electronically to share information and to bring the state's two major universities together to begin to research how to change the complex system to work more efficiently in order to cover more lives in increased quality and decreased costs. Combining information technology with research tools at our universities would be the first of its type nationally.
The subcommittee heard a presentation concerning the implementation of Senate Bill 2 from Sam Dunn, Chief Information Officer, and Shawn Croach, Executive Officer, Cabinet for Health Services. Mr. Dunn provided an overview of problems and solutions in the e-Health industry, i.e. cost, quality (timeliness and accuracy) and access to care. He noted (1) that health care cost equals approximately 17% of the GDP; (2) that the U. S. is ranked 72 in the world on efficiency in the delivery of health care; (3) that 57% of patients have to tell the same story to multiple physicians; (4) 26% receive conflicting information from different health care professionals; (5) 22% have had duplicative tests; and (6) 25% of tests results did reach the physician in time for the follow-up patient appointment.
Prior to Senate Bill 2, the cabinet had envisioned a network that could share information between providers, members, and payers. Senate Bill 2 directly addressed this process. Mr. Dunn noted that the cabinet is a "provider" at local health departments, mental health and retardation hospitals, it has "members," everyone in the cabinet needs health care and participate in employee health insurance, and the cabinet is a large "payer" in the state as a result of employee health insurance and Medicaid. The cabinet in building its own infrastructure to solve its issues determined that it should build generic solutions to address the issue as a whole not just within the cabinet. The same issues that can help the industry as a whole are within the cabinet also.
The cabinet feels that Senate Bill 2 sets the groundwork for Kentucky to start developing a secure electronic network that will allow health care providers including doctors, hospitals, and pharmacies to share medical information about patients through a paperless system; that Kentucky e-Health network will allow faster information sharing to reduce mistakes, inefficiencies and administrative costs, all resulting in better patient care. The administration is in the process of appointing the board members set forth in Senate Bill 2 and moving forward on the infrastructure previously discussed.
He pointed out that since there are no national standards at this point, all the cabinet's implementations are standard, independent which means that even though the standards may change , a new standard template can be inserted and it will ride on top of the infrastructure the cabinet is putting into place. The cabinet is actively researching and inventorying the current state of e-health systems in the commonwealth. They are working with Kentucky Hospital Association and other providers, documenting issues and how they believe e-health and automation will help them and then organize all the information so that when the board is formed they will be better informed to make their decisions.
In response to a question concerning the cabinet's overall vision of timeline to interact not only state employees health care but all citizens of the commonwealth. Dunn responded that there are different stages of the process and different timelines associated with each. The K-talk which is the operability engine is the hardware and software that hospitals, payers and members can access to pass and manage information, that phase of the system is scheduled to be online next year. At that point it will be managing all Medicaid claims, eligibility information. There are also deadlines for electronic medical records within the cabinet that are scheduled to be up and running the second quarter of 2006. As far as the adoption of those deadlines into the industry, some of those decisions will be made by the board. The main stumbling block in the implementation of the program within the state is the willing collaboration of the affected parties, i.e. providers, payers, and members. There has been discussions of incentivizing the different parties in an attempt to move the program forward. Dunn shared his thoughts based on the research and discussions with hospitals, etc. in gathering information that (1) the administrative process needs to be first in consideration for incentives which would be the financial claims process of getting payments made more timely, accurate, and efficient; (2) focus on the willingness of the providers to share the information so that providers are comfortable, including legislation that would address how the information is pulled from their database, how it is used, who can access it, how long they can have it. All the issues around making people feel comfortable with how the information is going to be shared, there are issues with liability.
Mr. Sproul asked if the committee would have any information available to it from Dunn's research that would assist it in making recommendations to the full panel. Dunn indicated that information would be complied for the cabinet. Mr. Croach indicated that there was some research that had already been done that could be provided the committee as to what works best.
An important item that makes technology implementations able to expand is the scalability. Policy leveraging infrastructure can greatly accelerate the speed to reach the goal and reduce costs.
Another stumbling block is getting the end user getting attached to an e-Health system because the forces in health care, cuts and reimbursement, could cut costs of heath care is putting a strain on hospitals and providers to put in resources and expenditures necessary. The health care system spends less in information technology that any other industry. Chair Mongiardo asked what type of incentives the committee should propose to end providers to entice them to implement an e-Health system as soon as possible in order to reach the goal of a statewide network that is connected to infrastructure. Leveraging infrastructure that is currently available can bring costs down. Also, if the system is designed correctly so that the effects that benefit the provider, such as dealing with the administrative process, getting paid faster and more timely and more accurate, eligibility issues, if those items are placed so that the electronic medical record can be the next level, the structure of the document instead of being a claim document is an electronic medical record.
Chair Mongiardo noted that in drafting Senate Bill 2 one of the ideas that was raised was that insurance companies would pay a minimal amount more per claim if a model system was in place and less if the system was not in place.
Carol Steltenkamp, a physician at UK, addressed the committee on incentivizing health care information technology. Making the link between health care information technology and quality does reduce medical errors, improve patient safety, results in improved quality of care. Misaligned incentives and payment policies are a couple of the barriers to information technology adoption in medicine, i.e. what will the physician receive in return for implementing the this technology to offset their costs when such technology reduces medical errors, improves patient safety and the overall qualify of care.
There are four direct financial incentives in health information technology.
1) Payment differentials;
2) Cost Differentials;
3) Direct reimbursement; and
4) Shared withholds
Ĝ Payment differentials would be pay-for-performance. If the physician has an electronic medical record in the office then you reward that provider or delivery system for having that technology because it improves the quality of care and has decreased the cost. This could be done a number of ways , i.e. per member, per year, or a percentage of the total claims increase. This is also being reviewed in the Medicare Modernization Act.
Ĝ Cost differentials are patient or consumer based incentives, giving the patient the desire to go to a physician or facility that has information technology. Educate and incentivize the patient by possibly not requiring a deductible if the patient goes to a location that has the information technology. So in turn the provider gains because of increased business. Any incentive amount has to be great enough to break a bond between a patient and their doctor if the provider does not participate in e-health care technology.
Ĝ Direct reimbursement is an online physician or provider visit in an non-emergency situation. The AMA does have this as a coded charge but most payers do not recognize them. Penetration is not great in Kentucky. Studies reveal most patients think it great and the providers like it also. It eliminates phone tag.
Ĝ Shared withholds are generally used in contract negotiations and most providers do not like it because it is a "stick" not a "carrot." And, what the payer can potentially say is that they would not contract with them unless they have an electronic medical record.
Items outside the direct health care payment system that do not directly involve the insurer or large employer but do have interaction within the payment system:
· Discount the malpractice insurance rate, if the provider has health care information technology;
· Tax credit opportunities for small businesses or health care providers; and
· Potential changes in the Stark and anti-kick back laws.
· Stakeholder clarity, all stakeholders have to be on the same page. The incentives have to be meaningful for all involved, the "win" or business case for it. There are third party standards, Leap Frog, NCQA and she suggested that the committee not come up with its own because they are already agreed upon standards that are recognized as being important.
· On-going communication and collaboration. In addition to being a catalyst for this type program, volume or a large enough group to make a difference.
·
Dr. Steltenkamp indicated there are standards but ultimately information will be chosen specifically, the minimum data set, such as name, rank, serial number, a list of allergies, current medications. She agrees that the business processes that need to be addressed first. Standards will be dictated in order for all electronic systems to communicate.
Chair Mongiardo indicated that a few years ago the legislature had an expert in information technology and health care testify before it and she commented that information technology is the first and only thing on the list that will significantly reduce the cost of health care and at the same time improve the quality of heath care. Dr. Steltenkamp agreed.
The Indianapolis area has an extensive health care information exchange network as well as New England and Southern California.
Marty White and Bill Doll, Kentucky Medical Association, also discussed technology incentives for doctors.
KMA recently conducted surveys as it relates to physicians use of the internet and electronic medical records. Copies of the internet survey are available, if the committee, was interested, and the medical records survey is still ongoing and hope to have more data from that in the future and would be happy to share that when available. According to internet use survey within a physician's practice in Kentucky:
§ 93% indicated they use computers in their offices for administrative or billing purposes;
§ 76% subscribed to an internet service; and
§ 58% allowed employees to have internet access.
§ Major barriers for implementing electronic medical records systems is the cost, second was the staff resistant to change. The electronic medical records survey is still in progress and the KMA continues to collect data.
§
Mr. Doll indicated he was in discussions with other stakeholders of what ultimately became Senate Bill 2 which represented a consensus on the front end that this is the direction to move in.
Mr. Mayo pointed out that there are barriers particularly with the federal government. He asked if the KMA has had any feedback from the physicians of how to deal with the inequity of moving forward. The significance in terms of reduction of cost comes from the fact that the ability to reduce errors because of eliminating handwriting and transfer of information.
A recent article in the American Medical News discussed the cost of mining the data and what the implications are.
Mr. Mayo indicated that approximately 80% of the physicians in his institution (HCA) utilize electronic systems but the barrier is integrating within the hospital system and many times that block is HIPPA issues. Unless there is a completely unified system such as Mayo Clinic, Cleveland Clinic where everyone is on the same system--integration is key.
The Chair indicated that the committee may need to make suggestions to the federal government of changes that need to be made either broad spectrum or on a lighter basis for Kentucky so we can move forward as a trial location.
The ability for persons in the commonwealth to come together as providers both as facilities and physicians from a political, lobbying standpoint with the federal government through different health issues and in talking with senators and congressmen, issues such as HIPPA to lessen the burden and not hamper those who want to gives their lives to serving citizens of the commonwealth and to be able to do it in a more effective manner utilizing electronics.
Chair Mongiardo indicated that the more physicians and providers that use the system the cheaper it becomes and the more rapid the development of the software. What can the committee do in recommending incentives to speed the implementation among the KMA members.
Mr. Doll stated that the first issue to address is to make certain that in the event that the system is embraced you have to remove that potential spectra of "if you do it this way, you will have problems with the federal government."
Cost is also a major factor. Developing standards as soon as possible that everyone can abide by will be helpful.
Mr. Mayo stated that HCA is integrated throughout 181 hospitals they have the ability to transfer information about patients however it is still hampered because of the fact that federal Stark laws become involved. Federal road blocks are a hamper and if something could be done in a model state that can send a strong message if those barriers can be broken down that could be modeled across the country.
The committee heard comments and presentations relating to medical malpractice from the KMA, Dr. Steve Kraman, Frank Doheny, a leading medical malpractice defense attorney, Tyler Thompson, Kentucky Association of Trial Attorneys, Rebecca Pehlke, Medical Protective Insurance Company and a representative of Kentucky Watch.
Mr. Doll stated that legislation was enacted in 1976 as a result of a Governor's Task Force on health care. The bulk of that legislation particularly the patient's compensation fund, was declared unconstitutional in Kentucky. A second task force was appointed by the legislature. Many laws in other states were enacted in Kentucky and were also found unconstitutional. There is a doctrine that developed in Kentucky called the Jural Rights Doctrine, the common law standard which permits a jury to impose punitive damages, rather than legislation. If you are going to enact legislation in Kentucky that is akin to bona fide reform of our liability system you have to precede that with a constitutional change, Section 54, keeping in mind that in doing that and enabling the voters to actually cast a ballot you do not enact any sort of cap or other type reform.
KMA personnel recommended that the committee view the associations website at www.kyma.org and read the stories of the physicians on the Crisis Watch site. Illinois has passed legislation and are doing pilot projects.
The Chair asked that KMA to indicate what the constitutional amendments should be and the reasons therefor.
Mr. Doll stated Senate Bill 1 has been the vehicle pointed to as the better way to go about the change which states that you would afford the General Assembly the opportunity to place a limit on non-economic damages and punitive damages which are not typically involved in medical malpractice cases however the fear of punitive damages is surfacing and being used as leverage which is a criminal issue and there is no insurance in Kentucky which covers such. He pointed out that Senate Bill 1 was structured in a way that the General Assembly could not establish a limit that was lower than $250,000. Secondly, afford the General Assembly an opportunity to establish an alternate mechanism for dispute resolution and such findings be admissible in court. The third element that was contained in Senate Bill 1 was the statute of limitations. Kentucky is essentially a discovery state so there is no statute of repose or close out date, i.e. an individual has a cause of action once you are made aware of injury which could be a lengthy amount of time after the action occurred. From an actuarial point of view it would be difficult to determine the projected exposure. The reason these items were addressed in Senate Bill 1 is to address those provisions of Kentucky's Constitution that make up the Jural Rights Doctrine, Sections 14, 54 and 241.
Senator Buford indicated that insurance companies are looking for consistency that they can possibly base the premium. Even if there was a constitutional change and the General Assembly imposed a "cap," insurance companies would need a history of the amount of non-economic damages incurred before any decrease in premiums to adjust.
A constitutional change needs to be decided first and then determine if a limit is necessary based on the outcome of the vote. In states where reform has been passed there have been results in lowering rates.
Senator Buford also stated that the municipal tax imposed on physician premiums which needs to be brought under control, a percentage that the city receives. If insurance companies had some type guarantee that the non-economic damages were going to stop at a point it may help them some because now they do not know what they are going to be imposed.
Mr. Mayo asked if there was any experience concerning damages where a physician has chosen to not carry insurance at all, or where there has been lessening of the limits of liability being required by an institutions where they practice which immediately lowers the premium because you are not insuring yourself at a higher level of coverage. In logical thinking, if there was the ability for the General Assembly to put a cap on damages and at the same time there is a willingness because of those caps to lower limits of liability requirements by hospitals then you could pay a lower premium for malpractice insurance immediately.
Mr. Doll stated that in the seventies under the Patient's Compensation Fund there was a way to self-insure. The idea of "going bare," having no insurance at all, is one that challenges people to have reasonable discussion and debate about if that is the right thing to do.
Illinois is a state that has a $350,000 cap on non-economic damages. Chair Mongiardo asked what scientific evidence exists that a cap at any level would reduce malpractice premiums in the state. Evidence that he has seen and read about, most recently from Dartmouth, would indicate that caps do nothing. Medical inflation, among other things, is the main cause of increase in malpractice premiums because as people are being injured what doctors are paying for is the treatment of that injury and as that treatment increase in cost so do insurance coverage. How can the legislature assure that the citizens of Kentucky have quality health care. There are two ways of insuring quality, regulations and judicial system. If the judicial system is lessened, is the medical profession prepared to have increased regulations to assure quality. The point he was making is that you have to be careful because the legislature is getting ready to set up a payment system to the health care delivery system that may in fact be punitive in that reimbursement can lead to decreased quality which will lead to increase in cost both in dollars and lives. System errors that occur can be controlled and improved upon, doctors do not report errors. Every error needs to be reported, even the most minute, to research and study why the error occurred and how to address it not happening again.
Mr. Doll indicated the absence of confidentiality and the ability to effectively deal with that creates a barrier to an effective system. No part of Senate Bill 1 addressed the confidentiality. There have been suggestions of modifications. The KMA is debating this issue currently.
Mr. White pointed out that the KMA governing body in 2002 developed a five-point plan for addressing the liability insurance crisis in Kentucky and at the top of the list was patient safety. Medical errors need to be addressed and KMA is at the forefront of addressing them.
Mr. Mayo felt that "quality" needs to be defined in the terms of the subscriber and not the provider. A subscriber defines quality as someone who looks them in the eye, greets them with a smile, checks on them, cares about me, and makes sure that their questions get answered, their family is attended to. If that is done, the thought of litigation evaporates. The ability to report errors and admit error will reduce the incident rate in terms of litigation. He also pointed out that bar coding in terms of medication administration reduces errors dramatically. He encouraged the committee and everyone who has any engagement in KMA that they support that approach from both technology as well as from a personal approach to providing care.
Chair Mongiardo encouraged KMA to actively pursue methods of reporting errors and a system that can research all errors.
Dr. Steve Kraman, presented a "common sense solution to the medical malpractice crisis" through a program entitled "Sorry Works." Dr. Kraman described his personal experience while co-directing the risk management program at the Veterans Administration Center in Lexington in which an incident occurred and the patient died as a result of a medical error. All next of kin were contacted, all facts disclosed, and an offer to negotiate a fair settlement.
¨ Source of the problem with medical malpractice is how hospitals react to financial threat.
¨ People understand errors but do not understand or accept self-protective behavior in medical caregivers.
¨ Acting in an honest and ethical manner resolves problems without the need for legislation or lengthy litigation.
The Illinois Legislature passed a bill proposing a state-supported pilot project of a program called Sorry Works modeled after the VA program in which two hospitals in the State of Illinois would pilot the approach by the Lexington VA program with the reassurance that in the event their liability payments increased, the state would cover their excess loss.
Over the years the Lexington VA has proved that a direct, open and supportive approach dealing with medical malpractice is practical, effective and affordable. An adoption of this type program nationwide would result in fewer lawsuits; lower settlement costs; lower defense litigation bills; better control over liability exposure; no limitation on constitutional rights of victims; swifter justice; and a safer health care system because of an eventual reduction in medical errors.
Other hospital practicing full disclosure other than University of Michigan are: Minneapolis Children's Hospitals; John Hopkins Medical Center; the Copic Company, a malpractice insurer in Colorado,; Stanford University Medical Center; Toro Lawn Equipment.
Over a sixteen year period at the Lexington VA, the largest single payment was $341,000 for wrongful death and the average settlement was $16,000 per claim.
It was noted there are differences between the VA and private sector, the main difference being there are no private insurers in the VA, only one insurer and one employer. There is also a two year statute of limitations; there are no punitive damages in the VA system but there is judicial discretion, the judge can award anything up to the amount requested initially by the patient. Also, it is easier at the VA to file a claim, no need for an attorney, just fill out the form.
Goals of tort reform:
· Make it harder to sue
· Make caps - it then becomes unaffordable for an attorney to take a case if monetary damages are small
Goal for Sorry Works technique:
· Simply make it unnecessary to sue
A practice in most hospitals is "root cause analysis," a scientific approach to finding out what went wrong; being willing to disclose what actions or what steps have been taken to prevent occurrence in future.
Simply doing what is right, is affordable for hospitals.
In order to obtain scientific evidence or statistics at least ten hospitals would be needed in a pilot over a four year period to be persuasive.
Consideration in looking at this type program -- is a way to align the physician in the hospital that was in a pilot study. One way to accomplish this is some type agreement with the physician or that the physician is employed or they sign an agreement to participate in multiple areas of safety and quality peer review, most importantly they agree to co-defense.
Chair Mongiardo asked whether hospitals who study a Sorry Works program would need a champion to which Dr. Kramer responded that a person, whether it be within the hospital or outside who understands the entire process was necessary. Dr. Kramer indicated that he could teach persons on how the process works.
If it is determined that a pilot program should be done, Dr. Kramer indicated that he would be happy to provide guidance for the pilot.
Frank Doheny, Jr., a medical malpractice defense attorney, talked with the committee about frivolous lawsuits and whether they are a problem.
Mr. Doheny felt that they are but on a scale of 1-10 in the medical liability crisis frivolous lawsuits are somewhere around a one or two. They are a nuisance, they are a whipping boy for the politicians. Most physicians and hospitals will tell that it is the meritorious lawsuit, not the frivolous lawsuit which is the threat to their existence.
In his opinion, the General Assembly could do a number of things to lessen the impact not only in the medical hospital situation of big verdicts but to broaden it for everything in the civil litigation arena.
1) Require that all damage awards be reduced to present value. This could be done without a constitutional amendment.
2) For awards that involve periodic payments such as for future medical care, require that the those awards be made periodically, monthly, yearly, etc., and not in a lump sum at the trial. The award is for the purpose of taking care of the patient harmed not as a "windfall" for others.
3) In wrongful death cases, Kentucky's statute on compensation alludes to compensating the estate of the deceased. What is not allowed is for the defense lawyer to show evidence of consumption, amount which was earned by an individual minus what he would normally spend on food, shelter, etc. so the damage to his estate is not what he earned but what he would have preserved for his estate.
4) Interest rate. The Kentucky statute on judgments has provided for a number of years for interest at the rate of 12% per annum. The statute that sets for the interest rate has never been fair. To correct this, the interest rate could be tied to the prime rate published in the Wall Street Journal.
Mr. Doheny stated that have nothing to do with frivolous lawsuits. A better avenue would be to give a jury reasonable and full information and then trust their judgment, properly instructed and informed.
Tyler Thompson, President, Kentucky Association of Trial Attorneys addressed the committee on medical malpractice in Kentucky.
Kentucky's insurance companies from 1996-2001 brought in $417 million in premiums paid by doctors and only $260 million was paid out to victims of medical negligence, not including defense of the claim. The reason premiums get raised is not because of the tort system but down turns in the market where the insurance company has invested their premiums.
Of note, in states where there are caps, the average premium increase is lower than states without caps as stated in the Medical Liability Monitor 2003. Example: Medical Protective Insurance Company increased premiums 40% in Ohio which has a cap on damages, and increased premiums in Kentucky only 14%.
According to a study of Kentucky medical malpractice closed claim experience conducted by Jay Angoff, former commissioner of insurance in Missouri, he found that the top four carriers in Kentucky have an $800 million surplus but only about $400 million is needed. No problem with excess surplus but should not have to raise rates when surpluses are that high and is not justifiable. Some suggestion to lower rates:
Kentucky has a statute that states healthcare providers that do charity healthcare work, the commissioner of insurance can order a refund of medical malpractice premiums if excessive. This should cover all doctors, not just those that do charity work.
Include a posting of the Department of Insurance's website what all carriers charge because there is no consistency among different specialties.
If Kentucky data is used to base rates, that should cause malpractice rates to fall.
The Department of Insurance could disallow rate increases when it determines that the insurer surplus is unreasonably large.
There should be a standard for estimating losses in the future.
Reports claiming that doctors are being driven out of the state or practice due to malpractice premiums are inaccurate. He pointed out that Kentucky has more doctors per capita than Indiana even though they have had tort reform for years and are ranked 18th per capita in metro areas and 27th in rural areas.
Mr. Tyler pointed out that there is no evidence to support the idea that caps will doing anything to improve premiums. Even if you could show that by putting caps on damages you could lower premiums by a certain percent it would still be the wrong thing to do. There are other solutions to address the problem rather than caps. Rate reform and insurance reform needs to be addressed.
Chair Mongiardo asked if attorney certification for medical malpractice to eliminate those attorneys that file frivolous lawsuits or at least have a certified attorney participate in the case. Mr. Tyler responded that that would be an option.
Mr. Tyler indicated that previously a certificate of merit from a physician had been discussed. Patient compensation funds are something that could be looked into but would have to be done in conjunction with the medical providers.
Chair Mongiardo asked for thoughts about expert panels. Mr. Tyler indicated he had not reviewed the constitutionality of expert panels but that he was not in favor of expert panels referencing Indiana.
Rebecca Pehlke, a Claims handler with Medical Protective Insurance Company. She addressed the committee based on her claims professional history rather than an actuarial standpoint. She feels there is a problem with frivolous lawsuits in Kentucky for physicians. Her definition of a frivolous or nuisance lawsuit is a case where the plaintiff has proceeded to file litigation against the physician and does not have an expert first review the case. Kentucky already has a provision in the law for "expert review" prior to a lawsuit being filed which is not enforced.
She suggested a possible solution would be to require affidavits to be filed along with the lawsuit stating an expert opinion of the criticisms they have with the insured physician. If there were more sanctions, fines against attorneys who file wrongful prosecution that would deter some of the frivolous lawsuits.
Kentucky is a good state to be in as far as medical malpractice insurance carrier. With a few modifications with some of the laws currently it could be a great state.
Ms. Pehlke indicated that doctors are assessed a premium for frequency of lawsuits as well as severity. It was also noted that new physicians receive a discount.
Mr. Mayo pointed out that physicians are coming into the state and are paying a discount in medical malpractice premiums and if they have claims within the first five or ten years they are leaving the state because of the increase in premium as a result of the frequency of lawsuits and severity. Newer physicians will come to Kentucky for that reason relative to medical malpractice.
David Mudd, Director with Kentucky Watch. Kentucky Watch is looking at this issue from a consumer advocacy viewpoint. Kentucky Watch is a clearinghouse for topics such as medical malpractice. Consumers cannot get answers as to why insurance rates go up, whether they are balanced and fair. They have found that the Department of Insurance is not forthcoming. They are questioning the Board of Medical Licensure. Are there a few bad physicians causing a big problem? Kentucky Watch indicated they will be pursuing both agencies for answers.
Chair Mongiardo recommended that the recommendations be broken down into two parts:
I. Information Technology - how to incentivize public health insurance for more rapid implementation of information technology.
II. Medical Malpractice. He suggested a first recommendation would be to recommend to the General Assembly that it have a resolution to the federal government on changes in HIPPA and Stark to help the implementation of a integrated network.
Mr. Mayo asked, for clarification, whether the committee's report that goes to the Blue Ribbon Panel under the two categories are they to be recommendations that will add to the opportunity to reduce costs overall.
Caps are not the solution but it may send the message that there are some limitations.
Filing of affidavits.
Reactionary penalties on plaintiff's attorneys that file a suit that has no merit.
The committee agreed that recommendations under the two categories could be accomplished via e-mail without have to meet again to discuss the recommendations.
Mr. Sproul asked if more strength was needed in Senate Bill 2. Chair Mongiardo pointed out that Board as set out in Senate Bill 2 would determine the standards and how the model will look. But as purchasers of healthcare the committee can develop incentives for the providers of healthcare to implement information technology locally. As the RFP is developed with the provider and administrator used that the incentives are implemented in that contract. The Board would coordinate all regions of the state, all networks will have to communicate throughout the state.
Mr. Mayo indicated that pay-for-performance is growing in popularity among reimbursing authorities and hoped that a third party administrator administering the state's plan will implement such as a condition of participation in the network.
A Sorry Works ten hospital, four year pilot program could be a recommendation from the Blue Ribbon Panel to the Legislature.
Chair Mongiardo asked the staff administrator to conduct research to determine the costs involved if this type program was done through one of the universities to gather data and analyze data. The State of Illinois or University of Michigan may be able to provide information concerning outlay and how they set up their program. Hospitals in different would be asked to participate on a voluntary basis to be able to compare social economic areas. He also that a trainer would be needed to train the risk management committees and Dr. Kramer would be a good source but there may be cost involved.
There is no system to report medical errors. What can the committee recommend so that medical errors are reported and data gathered to be reviewed to determine why they occurred and a solution so that they do not occur in the future.
Chair Mongiardo pointed out that he introduced a bill a couple of years ago to develop a recording center at the universities to report all medical errors. Protection of the information is paramount, privileged information for research.
Mr. Mayo noted that most hospitals do have information available on errors and use them for improvement and quality process but there is a reluctance to report those errors unless the information is protected. "No fault" encourages self-reporting.
Is a constitutional amendment needed to be able to release this type of information or is it statutory?
A combination of Sorry Works and error reporting could potentially lead to a significant improvement in quality.
If there was some type certification process that included both joint commission and accreditation and certain quality grades relative to national patient safety goals, etc. there are standards across the country that could be a point of getting a provider in the door.
v From today's meeting, there was a consensus to tie the interest rate to prime and to require an affidavit be filed by an attorney, not the physician, at the time the complaint is filed that the case has been reviewed and there is reasonable grounds for going forward.
v Seek an extension of the statute of limitation until the certificate is provided. Ohio has this provision.