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96–460 PDF 2004

S. HRG. 108–659

THE MEDICAL LIABILITY CRISIS AND ITS IMPACT

ON PATIENT CARE

HEARING

BEFORE THE

COMMITTEE ON THE JUDICIARY 

UNITED STATES SENATE

ONE HUNDRED EIGHTH CONGRESS

SECOND SESSION

SALT LAKE CITY, UTAH

AUGUST 20, 2004

Serial No. J–108–93

Printed for the use of the Committee on the Judiciary

(

(II)

COMMITTEE ON THE JUDICIARY 

ORRIN G. HATCH, Utah, Chairman 

CHARLES E. GRASSLEY, Iowa 

ARLEN SPECTER, Pennsylvania 

JON KYL, Arizona 

MIKE DEWINE, Ohio 

JEFF SESSIONS, Alabama 

LINDSEY O. GRAHAM, South Carolina 

LARRY E. CRAIG, Idaho 

SAXBY CHAMBLISS, Georgia 

JOHN CORNYN, Texas 

PATRICK J. LEAHY, Vermont 

EDWARD M. KENNEDY, Massachusetts 

JOSEPH R. BIDEN, JR., Delaware 

HERBERT KOHL, Wisconsin 

DIANNE FEINSTEIN, California 

RUSSELL D. FEINGOLD, Wisconsin 

CHARLES E. SCHUMER, New York 

RICHARD J. DURBIN, Illinois 

JOHN EDWARDS, North Carolina 

BRUCE ARTIM, Chief Counsel and Staff Director 

BRUCE A. COHEN, Democratic Chief Counsel and Staff Director 

(III)

C O N T E N T S 

STATEMENTS OF COMMITTEE MEMBERS 

Page

Hatch, Hon. Orrin G., a U.S. Senator from the State of Utah ............................ 1

prepared statement .......................................................................................... 51

WITNESSES 

Glodowski, Carla, Lehi, Utah ................................................................................. 28

Granger, Steve, M.D., Surgical Resident, University of Utah, Salt Lake City, 

Utah ...................................................................................................................... 14

Lee, George, M.D., Vice President, Medical Affairs, California Pacific Medical 

Center, San Francisco, California ....................................................................... 8

Nelson, John, M.D., President, American Medical Association, Salt Lake City, 

Utah ...................................................................................................................... 6

Page, Donna, Park City, Utah ................................................................................ 26

Rich, Charles, M.D., Salt Lake City, Utah ............................................................ 12

Sorenson, Charles W., Jr., M.D., Executive Vice President, Chief Operating 

Officer, Intermountain Health Care, Salt Lake City, Utah ............................. 10

Thronson, Charles, Utah Trial Lawyers Association ............................................ 31

SUBMISSIONS FOR THE RECORD 

Fay, John F., Attorney, Low Office of Gregory, Barton & Swapp, Lehi, 

Utah,letter ............................................................................................................ 42

Glodowski, Carla, Lehi, Utah, prepared statement .............................................. 44

Granger, Steve, M.D., Surgical Resident, University of Utah, Salt Lake City, 

Utah, prepared statement ................................................................................... 48

Havas, Edward B., past President of the Utah Trial Lawyers Association, 

statement .............................................................................................................. 56

Lee, George, M.D., On behalf of the American Hospital Association, Vice 

President, Medical Affairs, California Pacific Medical center, San Francisco, 

California, prepared statement ........................................................................... 60

Miller, LaRee, Executive Director, Utah Citizens Alliance for Safety & Accountability, letter ................................................................................................ 65

Mortensen, Douglas G., President of the Utah Trial Lawyers Association, 

statement .............................................................................................................. 67

Nelson, John, M.D., President, American Medical Association, Salt Lake City, 

Utah, prepared statement ................................................................................... 70

Page, Donna, Park City, Utah, prepared statement ............................................. 86

Rich, Charles, M.D., Salt Lake City, Utah, prepared statement ......................... 88

Sorenson, Charles W., Jr., M.D., Executive Vice President, Chief Operating 

Officer, Intermountain Health Care, Salt Lake City, Utah, prepared statement ...................................................................................................................... 94

Thronson, Charles, Utah Trial Lawyers Association, prepared statement ......... 102

(1)

THE MEDICAL LIABILITY CRISIS AND ITS 

IMPACT ON PATIENT CARE 

FRIDAY, AUGUST 20, 2004 

UNITED STATES SENATE, COMMITTEE ON THE JUDICIARY, Washington, DC. 

The Committee met, pursuant to notice, at 10:00 a.m., at the 

Huntsman Cancer Institute, Auditorium, 6th Floor, 2000 Circle of 

Hope, Salt Lake City, Utah, Hon. Orrin Hatch, Chairman of the 

Committee, presiding. 

Present: Senator Hatch. 

OPENING STATEMENT OF HON. ORRIN G. HATCH, A U.S. 

SENATOR FROM THE STATE OF UTAH 

Chairman HATCH. Welcome. We are happy to have all of you 

here in this beautiful facility that is dedicated for the well-being of 

mankind. This is an important hearing because we are going to 

consider some of the issues on both sides that make a difference 

in all of our lives. 

Today’s hearing will address the medical liability and litigation 

crisis in our country. It’s a scourge that is preventing patients from 

receiving high quality health care, or in some cases, any care at all, 

as physicians are driven from practice. This liability crisis not only 

robs many patients of access to vital medical care, but needlessly 

raises health care costs for all Americans. 

My colleagues and I have worked hard in the Senate to find a 

remedy for the crisis ravaging our health care system. Most recently, the Senate debated S. 2061, the Healthy Mothers and 

Healthy Babies Access to Care Act of 2003 and S. 2207, the Pregnancy and Traumatic Care Access Protection Act of 2004. 

S. 2061 addressed obstetrical and gynecological care and would 

hold physicians and insurers accountable for medical expenses in 

instances where they are clearly wrong. The legislation established 

a period of 3 years from the date of injury for a person to bring 

a claim, with exceptions in cases involving minors. The bill also 

would allow for unlimited awards of economic damages, while placing reasonable caps on non-economic damages, or in other words 

pain and suffering. 

Economic damages are payment of past and future medical expenses and loss of earnings, as well as the cost of having services 

in the home to assist someone who has been injured or incapacitated from a negligent act. S. 2061 placed no limit on these awards. 

Of course, damages meant to compensate for physical and emotional pain and suffering are not quantified. S. 2061 would cap 

2

awards of these damages at $250,000, in addition to economic damages. Very often, jurors award plaintiffs millions of dollars just to 

punish a defendant, not necessarily to compensate for what is an 

intangible loss. S. 2061 would also fix contingency fees to ensure 

that patients with valid claims do not see their rewards siphoned 

away by attorneys. The bill would allow lawyers to recoup fees to 

make a profit, but not at the unfair expense of the injured plaintiff. 

The bill debated by the Senate this year, S. 2207, was similar to S. 2061 in that it caps non-economic damages at $250,000 but 

leaves economic damages uncapped. The primary difference between S. 2207 and S. 2061 is that S. 2207 provides relieve to two 

specialties, OB/GYN and emergency or trauma physicians. It was 

limited to highlight two of the most high-risk and egregiously affected practice areas in our health care system. 

Unfortunately, both bills failed to receive the 60 votes necessary 

to invoke closure in the Senate earlier this year. We would have 

had a majority of votes, but in the Senate now on controversial 

issues you must have a super majority of 60 in order to even debate the matter. Since the House of Representatives approved legislation at the beginning of the 108th Congress, it now appears 

that the Senate inaction may derail reform and allow this liability 

crisis to continue unabated. 

To me, it is unconscionable that physicians are being driven from 

practice, and as a result, patients are denied access to quality 

health care. According to the Utah Medical Association, liability insurance rates for most Utah physicians increased by 55 percent or 

more in the last 2 years for some specialties. For example, those 

Utah physicians practicing obstetrics and gynecology have to deliver about 60 babies a year just to cover the standard insurance 

rate in 2003 at $71,000. 2004 insurance rates are now more than 

$81,000 for some OB/GYN physicians. A 2003 survey showed that 

25 percent of Utah’s OB/GYN intend to stop delivering babies within the next 5 years. 25 percent. And medical liability insurance premiums for Utah physicians continue to rise and increase pressures 

on physicians to restrict their services in our home state of Utah. 

Premiums rose by 30 percent in 2002, 20 percent in 2003, and a 

15 percent increase is expected in 2004. 

I am deeply concerned that we are needlessly compromising patient safety and quality health care. We know that only about 4 

percent of hospitalizations involve an adverse event and only 1 percent of hospitalizations involve an injury that would be considered 

negligent by the courts. These numbers have been consistent in 

large studies done in New York, California, Colorado, and here in 

Utah. However, equally troubling is that only 2 percent of cases 

with actual negligent results or actual negligent injuries, excuse 

me, result in claims. Less than one-fifth of claims filed actually involve a negligent injury. We simply must do something to correct 

these imbalances. 

The problem is particularly acute for women who need obstetrical 

and gynecologic care because OB/GYN is among the top three specialties with the highest professional liability insurance premiums. 

The other two are neurosurgery and orthopedic surgery. 

Today, there are 36 members of the Utah Neurosurgical Society, 

and currently there are 27 neurosurgeons practicing in Utah. Not 

3

all of these physicians are willing to cover high risk practice such 

as emergency rooms and trauma services. According to the American Association of Neurological Surgeons, AANS, Utah is one of 24 

states designated as ‘‘severe crisis’’ states based on either a 50 percent increase in professional liability premiums from 2000 to 2002 

or an average of neurosurgical professional liability insurance premiums over $100,000 a year. Now, this dubious honor for Utah citizens has affected their access to neurosurgical care. 

Studies by both the Utah Medical Association and the Utah 

Chapter of the American College of Obstetricians and Gynecologists, ACOG, underscore the problem in Utah. Over half, 50.5 

percent, of family practitioners in Utah have already given up obstetrical services or have never practiced obstetrics. Of the remaining 49.5 percent who still deliver babies, 32.7 percent say they plan 

to stop providing obstetrical services within the next decade. These 

and other changes in practice leave nearly 1500 pregnant Utahns 

without OB/GYN care. Now that’s a tragedy. 

An August, 2003 General Accounting Office report concluded that 

actions taken by health providers as a result of skyrocketing malpractice premiums have contributed to health care access problems. 

These problems included reduced access to hospital-based services 

for deliveries, especially in rural areas. 

In addition, the report indicates the states that have enacted tort 

reform laws with caps on non-economic damages have slower 

growth rates in medical malpractice premiums and claims payments. From 2001 to 2002, the average premiums for medical malpractice insurance increased about 10 percent in states with such 

caps. In comparison, states with more limited reforms experienced 

an integration of 29 percent in medical malpractice premiums. 

Medical liability litigation directly and dramatically increases 

health care costs for all Americans. In addition, skyrocketing medical litigation costs indirectly increase health care costs by changing the way doctors practice medicine. 

Defensive medicine is defined as medical care that is primarily 

or solely motivated by fear of malpractice claims and not by the patient’s medical condition. According to a survey of 1800 doctors 

published in the journal, Medical Economics, more than three-quarters of doctors felt they must practice unnecessary defensive medicine. A 1998 study of defensive medicine by Dr. Mark McClellin, 

currently the head of the Medicare program, showed that medical 

liability reform, or should I say CMS, his study, his 1998 study 

showed that medical liability reform had the potential to reduce defensive medicine expenditures by 69 to 124 billion dollars in 2001. 

Now, I used to be a medical malpractice defense lawyer. And I 

have to say that I estimated, when I was practicing, you have to 

do every possible thing you can to have that in your history, even 

if you don’t think it’s really necessary, so that you show that you 

have done everything, that you’ve done things way above the average in the community, as well, in order to have any degree of safety. And consequently that’s why I estimate there’s at least $300 billion a year of unnecessary defensive medicine. And frankly it’s a 

big problem. 

The AMA admits to about $70 billion. Listen to the AMA today 

tell us where their figures are now. If the AMA estimates $70 bilVerDate 0ct 09 2002 08:16 Oct 27, 2004 Jkt 096460 PO 00000 Frm 00007 Fmt 6633 Sfmt 6633 S:\GPO\HEARINGS\96460.TXT SJUD4 PsN: CMORC
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lion, you can imagine what it really must be. So it’s a big problem 

and it is costing every American. It is causing our health care system to run out of control. Something has to be done. Something 

reasonable. Something that still doesn’t hurt patients or hurt those 

who have been grievously injured. 

The financial toll of defensive medicine is great, and is especially 

significant for reform purposes, since it does not produce any 

health benefits whatsoever. Not only does unnecessary defensive 

medicine increase costs, it also puts Americans at avoidable risk. 

Nearly every test and every treatment has possible side effects. 

Thus, every unnecessary test, procedure, and treatment potentially 

puts a patient in unnecessary harm’s way. Seventy-six percent of 

physicians are concerned that malpractice litigation has hurt their 

ability to provide quality care to patients. 

There is plenty that can be done to address this crisis. Last 

March, the Department of Health and Human Services released a 

report describing how reasonable reforms in some states have reduced health care costs and you improved access to and quality of 

care. For example, over the last 2 years, in states with limits of 

$250,000 to $350,000 on non-economic damages, premiums have increased an average of just 18 percent compared to 45 percent in 

states without such limits. 

California enacted the Medical Injury Compensation Reform Act, 

also known as MICRA, more than a quarter century ago. MICRA 

slowed the rate of increase in medical liability premiums dramatically without negatively affecting the quality of health care received by the state’s residents. As a result, doctors are not leaving 

California anymore. 

Furthermore—and by the way, they are starting to leave Utah. 

Furthermore, between 1976 and 2000, premiums increased by 167 

percent in California, while they increased 505 percent in the rest 

of the country. Consequently, Californians were saved billions of 

dollars in health care costs, and Federal taxpayers were saved billions of dollars in Medicare and Medicaid programs. 

Before coming to Congress I litigated several liability cases. I 

have seen heart-wrenching cases in which mistakes were made. 

But more often I have seen heart-wrenching cases in which mistakes were not made and doctors were forced to expend valuable 

time and resources defending themselves against frivolous lawsuits. 

A recent Institute of Medicine report, ‘‘To Err Is Human,’’ concluded that ‘‘the majority of medical errors do not result from individual recklessness or the actions of a particular group. This is not 

a bad apple problem. More commonly, errors are caused by faulty 

systems, processes, and conditions that lead people to make mistakes or fail to prevent them.’’ 

Now, we need to reform or we need reform to improve the health 

care systems and processes that allow errors to occur and to better 

identify when malpractice has not occurred. The reform that I envision would address litigation abuses in order to provide swift and 

appropriate compensation for malpractice victims, redress for serious problems, and ensure that medical liability costs do not prevent 

patients from accessing the care that they need. And so I believe 

5

that Congress must move forward with legislation to improve patient safety and reduce medical errors. 

Without tort reforms, jurors will continue to award large and 

often unreasonable sums for pain and suffering. And a sizable portion of those awards will continue to go to the attorney rather than 

the patient. The end result is that many doctors cannot get insurance and many patients cannot get the care they need, and a small 

group of lawyers are sometimes unfairly enriched to the detriment 

of our society. All Americans deserve the access to care, the cost 

savings, and legal protections that states like California provide 

their residents. We must begin to address this crisis in our health 

care system, so Utahns and citizens across the country have continued access to their doctors, and doctors can provide high-quality, 

cost-effective medical care. 

And I might also add there are decent, honorable attorneys who 

bring suits that are worthy of being brought in this country. And 

we shouldn’t lump all attorneys in a category that they are all out 

just for the all mighty buck. There are very honorable attorneys in 

this country and there are suits that deserve to be brought, and I 

have seen them. But there’s a high percentage of malpractice suits 

that are brought just to see what you can get out of it that are frivolous in nature and really are costing all of us billions and billions 

of unnecessary dollars. 

Finally, I want to thank our witnesses for taking time out of 

their busy schedules to join us here today. We all look forward to 

hearing your valuable insights in this ongoing crisis and we have 

people on both sides of these issues. 

I also want to acknowledge some of our friends in the audience 

that will be submitting written testimony on this important issue, 

especially Doug Mortensen, who is President of the Utah Trial 

Lawyers Association. Accompanying Mr. Mortensen are Ed Havas, 

immediate Past-Present of the Utah Trial Lawyers Association, and 

Mr. Joel Alred, the President-Elect of the Utah Trial Lawyers Association. 

I would like to also acknowledge LaRee Miller, who is the Executive Director of the Utah Citizens Alliance. Ms. Miller is also submitting written testimony for this hearing. All of these testimonies 

are important to us and will help us to understand this even better 

than we do today. 

Now, that was a fairly lengthy statement, more lengthy than I 

usually give. But I don’t think there’s one part that didn’t need to 

be said. 

[The prepared statement of Senator Hatch appears as a submission for the record.] 

Senator HATCH. On our first panel we have Dr. John Nelson. 

We’re very proud of Dr. Nelson. He is the President of the American Medical Association. Can you imagine? We in Utah have the 

President of the American Medical Association right here in our 

state, and he is doing a great job. Dr. Nelson is from Salt Lake 

City, Utah and has been a practicing obstetrician/gynecologist in 

this area for many years. We are all so proud of Dr. Nelson and 

the dedication he has shown for both Utah physicians and physicians across the country. He is a good man, he’s an honest man, 

and he is one who I know very, very well. 

6

Next we have—I think all of our witnesses are honest, by the 

way. Next we have Dr. George Lee who is representing the American Hospital Association at today’s hearing. He is the Vice-President of Medical Affairs for the California Medical Center. 

Next we have Dr. Charles Sorenson who is the Executive Vicepresident and Chief Operating Officer for Intermountain Health 

Care. These are all great people. I know them all. 

Next we have Dr. Charles Rich, who is a retired neurosurgeon 

from Salt Lake, and one of the great neurosurgeons. He was also 

the chief medical officer for the 2002 Olympic games. And we have 

tremendous respect for him. 

Finally we have Dr. Steve Granger, also a great person who is 

a surgical president, or who is the surgical president at the University of Utah. Or resident, excuse me, at the University of Utah. Did 

I say ‘‘president’’? I think I did. 

So Steve is a surgical resident at the University of Utah, and we 

will hear him speak for young people going into the medical and 

health care field today. And this will be Panel One, and we will 

produce a second panel later. So we welcome all of you. If you will 

take your seats at the table, we will go to there. 

Let’s start with Dr. Nelson, the President of the American Medical Association first. And we can go across the table. 

STATEMENT OF JOHN NELSON, M.D., PRESIDENT, AMERICAN 

MEDICAL ASSOCIATION, SALT LAKE CITY, UTAH 

Dr. NELSON. Thank you, Mr. Chairman. How delightful it is to 

be home for both of us. 

Chairman HATCH. You’ve got that right. 

Dr. NELSON. For the record, I am John Nelson, practicing obstetrician/gynecologist in Salt Lake, President of the American Medical Association here to tell you that in medicine we are having a 

crisis. What’s a crisis? A crisis is when there is a sudden intensity 

of symptoms that increase during the course of the disease. We are 

seeing numerous symptoms today that tells us our system is in a 

crisis. The symptoms are unmistakable. A young boy in West Virginia, hurt in a football game, who has to be airlifted to another 

state because there’s no neurosurgeon in that state that can see 

him because of liability concerns, and a helicopter too small to accommodate his mother. 

A nurse in Bisbee, Arizona, bypassing the hospital in which she 

works at night, delivering her baby at the roadside in the middle 

of the night in the desert, because her hospital stopped delivering 

babies. 

A man killed a few blocks from a Level 1 trauma center because 

that trauma center had closed 2 days before he was injured, all because of liability concerns. 

Chairman HATCH. Pull that microphone closer, Doctor. 

Dr. NELSON. Yes, sir. 

Chairman HATCH. Can you hear in the back? 

Dr. NELSON. We are concerned about efforts to improve patient 

safety, and quality being stopped because of lawsuit fears. Twenty 

states are in crisis, up from 12 a couple years ago. And in Utah, 

a crisis is looming. 

7

Escalating jury awards and the high cost of defending against 

lawsuits, even meritless claims—I’ll let you fix the microphone. It 

won’t be better; it will just be louder. 

Escalating jury awards and high costs of defending against these 

suits, even the smallest ones, are the primary drivers of increasing 

medical liability insurance premiums. And several studies show 

that. 

So doctors have to do one of the three Rs: We restrict our practice, we relocate, and we retire. Physicians across this country are 

realizing every day that it simply is not acceptable. There’s 100,000 

physicians in a grass roots effort trying to do this. But this isn’t 

a doctor problem, really; it is a patient problem. The crisis is becoming a serious problem for patients and the access they might 

have for care. That’s why the AMA has a Patient Action Network 

with over 180,000 patients around the United States who delivered 

a half million messages to members of Congress. We will have 

300,000 patients by October to do the same. 

For the record, you understand this well because you are an attorney. The AMA believes that when an injury is caused by negligence, patients are entitled to prompt and fair compensation including all economic costs; future earnings, lost wages, all medical 

costs. And when they have these things occur, there is pain and 

there is suffering, we recognize that, and some money should be 

paid. We think a quarter of a million dollars is as good a number 

as any, and a significant amount of dollars because everything else 

has already been taken care of. 

But right now our system is not predictable or fair. You have already suggested many who have claims don’t bring them. We have 

to figure out a way to take care of these unquantifiable damages. 

The only way studies have suggested to do this is to limit not the 

issue of whether or not the patient gets paid for the economic part 

or the non- economic part. 

What has happened is we have found by study, that that which 

predicts the plaintiff being paid is how badly the person has been 

injured, not the presence of injury. 

What that means, Mr. Chairman, is doctors can follow the standards of care and still lose money in a lawsuit. That is simply unconscionable. We thank you for your hard work in this area. We 

have tried hard with you to work with Senate Bill 11, Patient First 

Act, which would do exactly as you suggest, to put a reasonable 

limit of $250,00 on the non-economic damage. This does work in 

California. We have the data. We can tell you with actuarial data 

what this will do. The J.O. itself said the rates of medical liability 

insurance premium growth are slower in those states where there 

has been this limit than in the states where there are not. 

The Agency for Healthcare Research has told us that there are 

more physicians per capita in states where these terms have been 

enacted instead of the other ones. 

There are many, many more stories. I won’t—it would exceed my 

time and the other colleagues on the panel can answer your question. 

The American Medical Association thanks you for your leadership in this area. We are here to tell you we are like the weatherman: There’s a storm coming. Mr. Chairman, now is the time to 

8

take care and batten down the hatches or there will not be people 

delivering babies. There will not be people here taking care of our 

injured children. Thank you very much for the time this morning 

[The prepared statement of Dr. Nelson appears as a submission 

for the record.] 

Chairman HATCH. Thank you, President Nelson. Dr. Lee? We are 

happy to have you here, Dr. Lee, and appreciate you. 

STATEMENT OF GEORGE LEE, M.D., ON BEHALF OF THE AMERICAN HOSPITAL ASSOCIATION, VICE PRESIDENT, MEDICAL 

AFFAIRS, CALIFORNIA PACIFIC MEDICAL CENTER, SAN 

FRANCISCO, CALIFORNIA 

Dr. LEE. Very pleased to be here. In my current role I’m the Executive Associate to the CEO of California Pacific Medical Center 

in San Francisco, which is a Sutter Health affiliate. But I have 

three roles. For twenty years I was the Chairman of the obstetrics 

department and I practiced obstetrics. For 12 years I have been a 

full-time hospital administrator. And thirdly, I helped form and 

have supervised the medical malpractice company that our physicians in San Francisco belong to and have a lot of experience on 

that side, also. 

I’m here today specifically to represent the American Hospital 

Association’s concerns, and the nearly 4700 hospitals and health 

care system members of which there are about 31,000. 

We appreciate the invitation to talk about a serious problem and 

what we believe is the solution. The problem? How to control a 

Federal medical liability system that threatens the ability of patients to get the care they need. The solution, Federal reforms modelled after those adopted in California in 1976. These reforms are 

working. It is not, by any means, a panacea. It doesn’t solve all of 

our justice problems. But it’s working extremely well. 

The reason it works is that a panel sees the need of all of our 

constituencies. Our patients receive their settlements and their 

awards much more quickly than the rest of the country. Our patients receive about 80 percent of the award versus 60 percent in 

the rest of the country. Our physicians are able to operate in a stable liability system that allows them to practice not only in the 

urban areas where our major facilities are, but in the rural areas 

where it is much more difficult to attract physicians. 

Our hospitals have the ability now to have more stable cost elements within the liability area so that we can direct more of our 

resources to other services that we wish to provide. And our rural 

communities are in a better position to attract physicians, particularly in obstetrics and neurosurgery and emergency room. 

Mr. Chairman, the effects of the medical liability crisis are wellknown, but the bottom line is that patient care is jeopardized. In 

many areas physicians are packing up and leaving because they 

cannot afford the cost of liability premiums. Hospitals and other facilities are closing down or curtailing important services such as 

emergency rooms and obstetrical departments. Where these kinds 

of services are still available, not only are liability premiums driving up the cost of care, but defensive medicine, the ordering of extensive tests and other services equally drives up the cost of care. 

9

And here is a very, very telling statistic. After an extensive 

claims analysis, we can clearly state that there’s very little correlation between the presence or absence of medical negligence and the 

outcome of malpractice litigation. 

Several states have enacted medical liability reform bills, but we 

strongly believe that this growing problem must be dealt with at 

the national level. The Federal Government pays for nearly half of 

health care delivered in this country. Standards of care are now national and defensive medicine costs the nation upwards of $100 billion. 

The California reforms enacted under the Medical Injury Compensation Reform Act of 1975, that’s MICRA, and reflected in the 

legislation that is now the language in Congress should be adopted 

nationwide. 

I had the privilege to serve on one of the committees that developed the language for MICRA. For more than 25 years MICRA has 

demonstrated that patients’ rights can be protected and at the 

same time medical liability costs can be controlled. States that 

have failed in their efforts to control costs are frequently those 

states that have enacted part of MICRA but not all of MICRA. 

The bipartisan Health Efficient, Accessible, Low Cost, Timely 

Health Care Act has been passed by the House but continues to 

run up against roadblocks in the Senate. The HEALTH Act contains these following MICRA provisions. It limits the amount a 

plaintiff can receive for pain and suffering. That’s the cap of 

$250,000. But importantly, all economic losses and all economic 

costs are paid in full. It limits the attorney’s care of 40 percent of the first $50,000 of 

the Plaintiff’s award, 33 percent of the next, and lowers percentages for higher amounts. This means that patients receive a higher 

percentage of their awards. In cases where the court decides that 

the Plaintiff will incur future damages over $50,000, the HEALTH 

Act allows the award to be paid over time. That’s periodic payments. 

It establishes a fair rule so that each party is liable solely for its 

share of damages and not for a share of any others. That’s joint 

and several liability. 

Collateral source rule provides that if there are other insurances 

that will also impact on the ability to provide resources to that patient, they can be taken into account when awards are made. 

These kinds of reforms have worked in California. Total awards 

in California, even with the cap, have kept pace with inflation; in 

fact, they have exceeded inflation. So the same proportion that we 

determined was an appropriate proportion in 1976 is what takes 

place today when awards are made. 

The average medical liability insurance premium in California, 

this is the average across all specialties, is $14,000 a year; less 

than the nearly $24,000 adjusted for inflation being charged in 

1976. It has been a remarkably stable environment in California in 

that our premiums, although they have gone up to some degree, 

have remained very constant particularly for the higher specialties. 

The average time to settlement is now 1.8 years in California, as 

compared to two and a half years in other places in the country. 

As I said before, patients benefit more directly today than the atVerDate 0ct 09 2002 08:16 Oct 27, 2004 Jkt 096460 PO 00000 Frm 00013 Fmt 6633 Sfmt 6633 S:\GPO\HEARINGS\96460.TXT SJUD4 PsN: CMORC
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torneys do. And in a $1,000,000 settlement, a patient used to receive about $600,000 of that settlement. Now they receive 

$800,000. Quicker settlements and a higher percent of awards is 

what the patient receives under MICRA. 

The AHA also supports a uniform statute of limitations and the 

continued development of successful conflict resolution programs. 

Non-traditional approaches such as alternative dispute resolution 

systems can play an important role in reforming the health care liability system. 

MICRA-style provisions as embodied in the HEALTH Act won’t 

make a tort system a perfect system, but it will create stability and 

fairness for patients, physicians, and hospitals. 

Again, we appreciate the opportunity to be with you and I’m 

happy to answer any questions as we move on. 

[The prepared statement of Dr. Lee appears as a submission for 

the record.] 

Chairman HATCH. Thank you, very much. It has been very good. 

Dr. Sorenson? You are handling a major hospital network here, so 

we look forward to hearing your testimony. 

STATEMENT OF CHARLES W. SORENSON, JR., M.D., EXECUTIVE 

VP/CHIEF OPERATING OFFICER, INTERMOUNTAIN HEALTH 

CARE, SALT LAKE CITY, UTAH 

Dr. SORENSON. Thank you, Mr. Chairman. I’m a urologic surgeon 

who has practiced in Salt Lake City for the past 22 years, so I’m 

testifying as a physician and also on behalf of Intermountain 

Health Care where I serve as Executive Vice-president and Chief 

Operating Officer. I appreciate the opportunity to offer our perspective on the professional liability insurance crisis and a need for 

Federal tort reform. 

The medical liability crisis is adversely affecting patients in Utah 

in several ways. First, it contributes to the increase in costs of 

medical care which is already rising at an alarming rate. As a 

health care system, we are struggling to keep medical care affordable. This represents a considerable challenge. The cost of pharmaceuticals, medical equipment, and facilities are rapidly increasing. 

Increasing numbers of uninsured and charity patients, coupled 

with inadequate Medicare and Medicaid funding, necessitate cost 

shifting. This further increases costs for those with commercial insurance. 

Adding to these expense challenges is a 136 percent increase in 

malpractice insurance costs over the past 7 years. This is despite 

the fact that Intermountain Health Care has received national recognition for clinical excellence and has a favorable claims record. 

We see many dollars expended in the defense of claims that are ultimately judged to have no merit. Clearly we would much rather 

spend that money on improving patient care or reducing our 

charges for the patients we serve. 

Costs increase even more because of defensive medicine. These 

additional testing procedures add no useful clinical information and 

serve only to protect the physician in the case of a subsequent lawsuit. While we have a strong system-wide focus on evidence-based 

best practices, it is difficult to ask physicians to forego certain procedures they believe might protect them from litigation, even when 

11

such procedures aren’t based on objective clinical evidence. The unfortunate fact is that too many medical standards in America have 

been created by legal precedent rather than by scientific evidence. 

Secondly, while increasing costs are worrisome, I have much 

greater concern about a developing shortage in a number of vital 

medical specialties. We may reach the tipping point, where doctors 

are unwilling to care for the types of illnesses and injuries that expose them to unreasonable professional liability risk. 

We feel the impact in our emergency rooms and trauma centers. 

Many doctors are reluctant to take E.R. call in such specialties as 

trauma surgery, neurosurgery, orthopedic surgery, and plastic surgery. Many have been sued for treating the difficult problems encountered there, even when their peers found the care they provided was consistent with best standards. We worry about who will 

care for our sickest patients when no physician is willing to assume 

the professional and financial risk. 

We feel the impact in Utah’s rural communities where physicians 

are simply unable to afford the additional liability premiums needed to practice obstetrics or to perform basic surgical procedures. 

The obstetrical crisis is extending even to our larger communities 

where a growing number of physicians are giving up obstetrical 

privileges, leaving expectant mothers with fewer choices. 

We are very concerned by predictions of an even greater shortage 

of critical specialists in the future. America’s medical schools and 

our own at the University of Utah report a dramatic decrease in 

the number of students pursuing residencies in surgical, obstetrical, and other high risk specialties. Who will be there to care for 

all of us and our families as patients in the years ahead? 

I’d like to now briefly offer two perspectives on potential solutions to the crisis. First, even though Utah has been a relatively 

progressive state in implementing tort reform, our problems are increasing. National limits on non-economic damages would be especially helpful. While Utah has a cap, it has not yet withstood challenge in the state Supreme Court. Federal laws that are consistent 

nationwide and able to withstand challenges at the state level 

would be helpful in correcting perverse incentives in our current 

tort system. 

We recognize the need to fairly compensate injured patient. But 

liability ought to be based on objective science, not on emotional 

appeal. For this reason, some form of alternative dispute resolution 

may be helpful. 

In conclusion, number one, the professional liability insurance 

crisis is adversely affecting the delivery of care in Utah. If changes 

are not made, Utahns will not have access to critical specialists in 

time of their greatest need. Second, Federal action on tort reform 

including limits on non-economic damages is urgently needed. 

We definitely agree that injured patients must be fully and fairly 

compensated. The challenge is to develop a better process for determining such compensation. On behalf of IHC, our volunteer trustees, our clinicians, and the patients we serve, we thank you, Mr. 

Chairman, for your interest and the opportunity to testify here. 

[The prepared statement of Dr. Sorenson appears as a submission for the record.] 

Chairman HATCH. Thank you. 

12

Dr. Rich, good to see you. We appreciate all the work you did on 

the Olympics. You must be enjoying the current Olympics in Athens. 

Dr. RICH. They have a very good team. 

Chairman HATCH. Our kids have really done well. Can’t help but 

watch them. 

STATEMENT OF CHARLES RICH, M.D., SALT LAKE CITY, UTAH 

Dr. RICH. Senator Hatch, thank you for the invitation to participate on this panel discussing Utah’s professional liability crisis and 

the need for Federal tort reform legislation. 

According to the survey that you mentioned from the American 

Association of Neurological Surgeons, Utah is one of 24 states that 

they judged to be a ‘‘severe crisis’’ professional liability state. As a 

consequence, there is a concern that we are, on behalf of our patients, watching the situation occur where there is no access to us. 

There are only 27 neurosurgeons practicing in Utah. That’s a 

smaller number than were here 5 years ago. Some of them cover 

very liability- intensive Level 1 and Level 2 trauma centers. Others 

would prefer not to. The University of Utah Health Sciences Center 

is self-insured. They have excellent neurosurgeons and they operate in a fundamentally different environment than those of us in 

private practice function. 

Chairman HATCH. By ‘‘self-insured,’’ what do you mean? 

Dr. RICH. The people at the University of Utah Health Sciences 

self-insure. 

Chairman HATCH. Part of their budget? 

Dr. RICH. That’s right. 

Chairman HATCH. So it costs everybody in the state for that selfinsurance. 

Dr. RICH. But whereas a private- practicing neurosurgeon goes to 

the market and looks for companies like St. Paul or the Utah Medical Insurance Association, and has to negotiate each year for their 

own premiums. 

Chairman HATCH. And St. Paul no longer provides— 

Dr. RICH. That’s one of the messages here. 

Chairman HATCH. I didn’t mean to interrupt you. 

Dr. RICH. No. That’s a very pertinent point. 

The issue as it concerns the patients of Utah is the following: 

That although neurosurgeons are few in number, they are absolutely essential if there is to be available to the Utah public the following services; emergency rooms, tertiary or quaternary care, intensive care units, medical air transport systems, Level 1 and 

Level 2 trauma services, and for that matter a Utah State Bureau 

of Emergency Medical Services. Without easy access to neurosurgeons, not one of the above is a viable, functional entity. Our 

remarkably small number of willing neurosurgeons maintain that 

vital functional link. 

And I want to emphasize that the group with which I’m familiar, 

you couldn’t find a more dedicated, hard-working group of people. 

There are three neurosurgeons in Ogden who cover McKay Dee, a 

Level 2 trauma center; five covering LDS Hospital, which is a Level 

1 trauma center, taking 1200 severely traumatized patients a year; 

and then there are three down in Provo covering the Utah Valley 

13

Regional Medical Center. And if you have never done it, don’t underestimate what it takes to be on call every third night or every 

fifth night when the prospect of being up all night is a very likely 

possibility. 

There are three ways that this is affecting patients and the citizens of Utah as far as their access to neurosurgeons is concerned. 

One of them is early retirement. I cite myself as Exhibit A. When 

I finished with the Olympics I was 66 and very healthy. I think I 

know a lot about neurosurgery, but I knew that my premium for 

that next year would be $82,000 despite the fact that I have never 

had a payout, to my knowledge, from my insurance carrier. I 

wasn’t willing to spend $82,000 for a reduced level of practice. It 

simply didn’t make any sense. This year, if I were doing it, my premium would be $93,000 and 

I submit to you that people in my situation start to make a judgment as to whether any of this makes sense. 

When you mentioned St. Paul, this has a direct effect on our coverage. We have a very large referral center here. One of our neurosurgeons who retired this year was insured by St. Paul, and when 

they went out of business he retired forthwith. And that had the 

effect of having our neurosurgeons not on call every sixth night, 

but every fifth night. And I remind you that St. Paul is willing to 

insure hurricanes and property casualty problems, but they cannot 

afford, apparently, to engage in the selling of insurance for professional liability. 

The other way that this is affecting the access of Utah patients 

to neurosurgeons is that they are altering their practice. There was 

a survey done of 563 neurosurgeons nationwide in 2002; 29 percent 

responded that they were considering retirement, 43 were considering restricting their practices to low-risk surgeries, and 19 were 

considering moving in response to the liability insurance crisis. 

There is a penalty that you pay in terms of your liability premium for doing craniotomies and cranial work. That is a very 

strange incentive when that’s the very service that is needed in 

these emergency services, and yet those who engage in that— 

Chairman HATCH. That’s on top of the $91,000? 

Dr. RICH. That’s part of what they compute. But if you are not 

doing cranial surgery you pay one, and if you are you are paying 

a higher amount. 

The other way that it is affecting access to the citizens of Utah 

in neurosurgery care is just the entry level. If you look at surveys 

which have been done of medical students—keep in mind that neurosurgery requires a six to seven year residency post medical 

school. And it is a very hard program. There are fewer and fewer 

people who are medical students applying for the neurosurgery 

match. That has been documented since 1991, and is particularly 

true since 1995. And I don’t think anybody doubts that it has something to do with the fact that neurosurgery is the most sued surgical sub- specialty and certainly has the most difficulty getting liability insurance. 

Four rhetorical questions: If you finished your residency in neurosurgery and were looking for a favorable location in which to 

practice, would you choose Utah with a severe professional liability 

crisis? If you were a young neurosurgeon already in Utah and 

14

noted that the fees paid for neurosurgical procedures were higher 

in Idaho and your professional liability premiums were lower, 

would it be appropriate to move there? 

One of the really capable neurosurgeons that we had in Utah left 

for Coeur d’Alene, Idaho about 3 years ago, and it’s good for them. 

In good part a reflection of a litigious atmosphere practice, the 

number of practicing neurosurgeons in the United States has declined since 1998. By 2002 there were fewer in practice than there 

had been in 1991. During 2001 alone, 327 board certified neurosurgeons, comprising 10 percent of our National work force, left 

their practices. Considering the availability of essential services to 

the public, of more concern is a large proportion of those remaining 

are in the 50 to 65 year old age group and they have already altered how and where they practice in response to this crisis. And 

the only remaining option they have is to cease practice altogether. 

Senator Hatch, I remind you of the time when my practice partner, Bruce Sorenson, and I sat in your office in April of 1995. As 

I recall, that very day we discussed tort reform and there had been 

a vote that day that you were disappointed in. I think you have 

been our ally, I think you supported us. We are grateful to that. 

And I think it is important to emphasize that the people you are 

representing in this are the citizens of the state of Utah. Thank 

you. 

[The prepared statement of Dr. Rich appears as a submission for 

the record.] 

Chairman HATCH. Thank you, so much. We appreciate your 

forthright testimony. 

Dr. Granger, you are one of the younger doctors here. We want 

to hear what you have to say about your future and what you think 

about it. 

STATEMENT OF STEVE GRANGER, M.D., SURGICAL RESIDENT, 

UNIVERSITY OF UTAH, SALT LAKE CITY, UTAH 

Dr. GRANGER. Thanks for the opportunity to represent medical 

students and residents in this important hearing. 

As you mentioned, I’m in my general surgery residency here at 

the University of Utah. I chose a career in medicine as an undergraduate because of my interest in the sciences, and a naive desire 

to help in the healing process. I did not have a personal or family 

background in health care or law. At the time of this early decision, 

medical malpractice was little more than a bad commercial to me. 

Through 4 years of medical school and 4 years of residency, this 

naive view of malpractice couldn’t have changed more dramatically. 

Unfortunately I believe most medical students now consider the effects of malpractice when choosing a medical specialty. Students 

who are particularly adept at surgery or obstetrics are consciously 

deciding to pursue alternative specialties because they want to 

avoid the perceived devastating effects of the country’s malpractice 

crisis. 

Four years of undergraduate studies followed by 4 years of medical school and then an additional three to 7 years of residency is 

a significant commitment, and students are unwilling to enter specialties where they perceive they will be thrown to the wolves. A 

study published in 1998 at the University of North Carolina 

15

showed that perceived malpractice premiums have had a negative 

impact on medical students choosing specialties in surgery. And I 

think this influence has only worsened since 1998. 

The few of us that do still hold that naive notion that we can 

practice in these certain specialties have our eyes further opened 

when we enter residency. As residents, we are protected from almost all the business and insurance aspects of health care. We 

really have minimal to no exposure with reimbursements, business 

decisions, and malpractice insurance as residents. We don’t act 

independently and therefore we are protected from lawsuits in residency. 

Even in the currently hostile environment of health care, our 

education continues to focus on the proper care of the patient. Yet 

despite this protective environment, we see and feel the overpowering influence that medical malpractice has on patient care and 

leading to practice decisions. Two of the surgical residents that I 

worked with as an intern, I have a small class of five that get accepted every year into our surgical program, and two of our five my 

first year clearly stated that they wished to enter alternative nonsurgical specialties and they dropped their surgical training for another specialty. They didn’t want to work as hard as surgery demands during residency only to find themselves caught in the middle of a broken system. So they stopped their surgical training and 

chose alternative specialties. 

I remember long conversations with these two residents where 

they questioned my sanity to stay in a specialty that works as hard 

only to have more risk. I propose that no businessman or executive 

would choose to enter an environment where they are guaranteed 

to have higher risk for guaranteed lower pay. 

A survey conducted in 2003 of residents in their final year of 

training, you should have been excited about the prospects of finally venturing off into their careers showed that one in four of 

these graduating residents would choose a different vocation altogether if they could start over, and that their predominant concern 

was related to malpractice. 

Physicians have been charged with care of the sick, whether a 

friend or enemy. Historically, media portrayals such as MASH depicted the physician as a patient advocate, often at great personal 

or professional costs. Under this environment that we are still 

trained in today, compassionate quality care of the patient is our 

highest priority and training. 

Interestingly, in June of this year at a national American Medical Association meeting a proposal was made and debated about 

whether medical treatment should be refused to malpractice lawyers. This seems comical to me and it was widely shunned at the 

AMA meeting, but it does depict the nature of our current environment. Imagine the new medical student creed: We will care for our 

patients, friends, enemies, terrorists, but not malpractice lawyers. 

That’s an interesting statistic, an interesting discussion and it 

was widely shunned, but it does depict the nature of the environment. 

One interesting statistic shows that before 1960, only one of 

every seven physicians was sued during their careers. However, 

current estimates indicate that one in seven physicians is sued 

16

every year. For a medical student and a resident, this environment 

is discouraging. 

My training emphasizes competent, compassionate care of the 

patient. Every interaction of every day is about how I can better 

care for my patients, often at great personal sacrifice. This is all 

I’m exposed to as a resident. I don’t get exposed to any of the medical liability environment except to see its impact. All I want to do 

is care for the patient, and that is to spend my professional life caring for the patient. But I fear in the current environment many decisions are made regarding practice based on the impacts of medical liability. 

Difficult problems rarely have simple solutions, but I think the 

difficulty of the solutions shouldn’t prohibit aggressive efforts at a 

multi-faceted solution. 

Fortunately, for the physician and patient, medicine can still be 

about care of the patient, but I fear that under the current medical 

liability environment this altruism will be more impossible with 

every passing medical school class. 

I appreciate your advocacy for change and hope that we can 

cause some of these efforts to occur. 

[The prepared statement of Dr. Granger appears as a submission 

for the record.] 

Chairman HATCH. Thank you so much. It has been a nice panel 

and certainly has presented a lot of the problems that exist. I know 

you have to leave, Dr. Nelson, so I want to start with you first. And 

that is, in your job as the AMA President, the American Medical 

Association President, I know you had the opportunity to speak to 

thousands of physicians across the country. What are these physicians hearing from their patients regarding the medical liability 

crisis? 

Dr. NELSON. We have traveled from border to border and coast 

to coast. I was in Oregon last week and heard a series of stories 

of concern. I’m thinking of a young woman in Newcastle, Wyoming 

who delivered her baby by Caesarean section, was pregnant for the 

second time. In the eighth month of her pregnancy, the liability 

premiums increased and the doctors couldn’t afford them. She had 

to go over a hundred miles to another state to deliver their baby 

elsewhere. 

I’m thinking of Dr. Melissa Edwards who all her life wanted to 

be an obstetrician. At age 15 a caring teacher took her to a hospital, and she became an obstetrician, working her way through on 

her own from a blue collar family. Board certified. Wonderful doctor. Watched a colleague of hers one night deliver a baby. The colleague did appropriately but a lawsuit, $8 million for cerebral 

palsy, a disease known to occur in utero and not because of birth 

trauma, was assessed against this other doctor. And Dr. Edwards 

quit the practice of obstetrics. 

What we are seeing is the doctors are doing the three R’s; they 

are retiring, they are restricting their practice. Lots of doctors are 

not delivering. 

This is only the tip of the iceberg, Senator. Forty-eight percent 

of medical students tell the American Medical Association where 

they will practice and what they will practice is dependent on the 

liability situation. And this year in obstetrics and gynecology, the 

17

best of all specialties, I might add, 68 percent of the residencies did 

not fill, nearly a third of the residencies did not fill this year. 

Bring that home. Last year, in the entire medical school class in 

the University of Massachusetts, not one doctor went into obstetrics. 2002, the University of Utah, not one of a hundred doctors are 

going into obstetrics. 2003, two will, but one will not deliver babies. 

And I don’t have the 2004 data. But of the last 200 doctors, only 

one will deliver babies. This is only the tip of the iceberg. We have 

to fix this or there will not be people to take care of patients. 

Chairman HATCH. In the state of Utah where we have a lot of 

babies, it seems to me we have have to encourage people to go into 

obstetrics. But let me ask you this: You have traveled all over the 

country. How many states allow physicians to practice without—I 

don’t like the word ‘‘malpractice,’’ but without medical liability insurance? 

Dr. NELSON. It varies from state to state. There are 15 states out 

of 50 that have a law on the state statutes that suggests that for 

a physician to practice in a hospital he or she must have professional liability insurance. 

The more common circumstance is that the hospital medical staff 

itself demands it, or the medical station in which they serve. That’s 

the case where I practice at LDS Hospital. We think it is appropriate for our colleagues to be protected so it doesn’t negatively affect on patients. But the issue is how much it costs. 

There are some very unique schemes. You have to look at Connecticut and what they are doing. You have to look at Pennsylvania. There’s a surcharge for a catastrophic fund that doubles the 

amount of liability insurance. It is so bad there you have to get it 

from two companies. They will only sell half the policy. Specialists 

in my specialty in Florida spend $250,000 a year per doctor. Most 

doctors there are not having liability insurance. If the hospital or 

the state makes a rule they have to have it, those doctors simply 

will not practice. 

Chairman HATCH. What happens if a doctor doesn’t have medical 

liability insurance? 

Dr. NELSON. Of course, if the law or the statute or the hospital 

says they have to have it and can’t practice, they’ll lose the patient 

as well as the doctor. 

There are negligent acts. We acknowledge that. When a patient 

has been injured through the act of negligence on the part of the 

physician, that patient should be paid promptly, fairly, and completely. We even believe there should be some monies paid, a substantial amount, a quarter of a million dollars for pain and suffering in addition to every other thing that should be paid. 

Our concern is that the data tells us, the evidence tells us that 

that is not the case. What we are seeing is that when a person is 

badly injured, that is what determines whether there is payout. We 

actually have cases where the doctor follows the standard of care 

and there is still payout. 

Chairman HATCH. All of you have chatted about this to a degree, 

but how many physicians have either retired or limited their scope 

of practice due to medical liability concerns? And how are the patients affected by that? You have all talked about that a little bit 

here. But is patient access to care more limited as a result of this? 

18

Dr. NELSON. We cannot give you actual numbers. We have one 

person who is the alliance president in Pennsylvania, he has a 

white coat ceremony. He goes up on the stage and has a white coat 

and a name of every doctor in practice in Pennsylvania that year, 

and we are up to several hundred. The problem is the count isn’t 

accurate. 

For example, I have a license in Wyoming which is very difficult 

to get. I have maintained it. I have not delivered a baby in Wyoming since 1992. I haven’t delivered in Salt Lake City since 2003. 

In both states the opponents of this side would suggest I’m available. But my patients can’t count on me in either state. We don’t 

have the data and we need help in getting it. So it’s not just the 

number of doctors; it’s what they actually do. 

Chairman HATCH. Dr. Nelson, has the AMA seen direct evidence 

that medical liability premiums have risen more slowly in the 

states with non-economic damages? 

Let’s understand. When we are talking about economic damages 

we are talking about lost wages, medical care, hospital costs, et 

cetera, et cetera. When we are talking about non-economic damages, basically pain and suffering that a jury is going to have to 

determine. 

Dr. NELSON. Medications, orthotics, prosthetics, hospice care, 

trauma care. Everything a person would need. 

Chairman HATCH. All the bills that can be received are paid by 

the economic damages. 

Dr. NELSON. We can give you three pieces of evidence. Number 

one, the California circumstance where premiums, on average, 

have risen three times faster across the country than in California 

since the enactment of MICRA. 

A study by Tillinghast-Towers and Perrin, an actuarial firm, who 

says the factor for liability premiums to increase, the fact that the 

liability premiums go up, is due to the fact that there is payoffs 

that have to do with non-economic damages. Last year the state of 

Texas passed a state Constitutional amendment in which they limited the losses to $250,000. The largest liability carrier in that 

state increased those premiums by 12 percent, and seven new carriers are coming into the state of Texas this year that are leaving 

other states. There’s no question. In six states that don’t have a crisis all have in common some method to limit non-economic damages. And by the way, I’m sure you know, people in California sue 

twice as often as the rest of the country. It does not limit their access to court. 

Chairman HATCH. You have been a real help here and I appreciate the work you have done for the AMA. And we are proud as 

fellow Utahns that you head the whole association and we have 

been privileged to listen to you. 

I’m going to have some tough questions in addition for some of 

you others, but I’m letting him off the hook here. 

Dr. NELSON. I’ll take a couple, too, Senator. 

Chairman HATCH. I knew you would. If you need to leave, go 

ahead. 

When I ask some of these tougher questions, any of you can answer if you care to. Any of you can answer any of these questions 

that I’m asking. Dr. Lee? 

19

Dr. LEE. I want to make an additional comment that you asked 

on the long-term impact of when physicians lose their liability insurance what happens to patients, what happens to the system. 

Chairman HATCH. Yes. 

Dr. LEE. I want to go back to 1976 in California in our rural communities. I happen to have a small ranch in northern California, 

Mendocino County, a population of about 15,000 people. Prior to 

1976, most of the obstetrics was performed by people in general 

practice. They had a few obstetricians at one central hospital, one 

central community in that county. 

When the crisis of 1976 occurred, most of the general practitioners stopped providing obstetrical practice, and at the present 

time, patients now have to travel 50 to 75 miles from other parts 

of the county to get to the one central hospital that will provide obstetrical services. 

The impact is not exactly what is happening today. The impact 

is what will happen over time. When those resources withdraw 

from a rural county, it takes forever to try to get those resources 

to go back. Changes—and patterns of practice change. Physicians 

no longer want to go back into the rural communities because it 

is difficult to make a living in rural communities. And once the system changes and the physicians leave, getting them back is very 

difficult, and then the patient no longer has access to the services. 

That’s the longer term impact. And that’s what can happen in Utah 

if this continues on and on. You begin to lose the resources in your 

rural communities. 

Chairman HATCH. Let me ask you this: As head of the American 

Hospital Association, how many hospitals across the country are 

paying for their physicians’ medical liability insurance or costs? 

Not even the insurance but— 

Dr. LEE. That varies dramatically from state to state. If you take 

Florida, which has a very serious problem, many of the obstetricians from Florida are either going without insurance or the majority of them are actually now being employed by the hospitals. So 

the hospital is footing the whole package of providing obstetrical 

services. 

Now, they can do that for a certain amount of time. But at some 

point in time, there are only certain resources the hospital has. If 

you direct all those resources to obstetrics, you have to pull back 

on the other things you have, taking care of other patients who 

perhaps don’t have the same access, financial resources, that the 

more wealthy blue collar patients have. 

Dr. NELSON. So it’s a wrong answer to a tough question. There 

are at least two reasons why hospitals shouldn’t do that. Number 

one, hospitals are already strapped. There are many, many other 

things of concern to them. They shouldn’t have to pay that. And 

when they do, all that does is shift the costs on their back. It 

doesn’t fix the system. It is just a different way to pay for a system 

that is broken. 

In the state of Oregon the legislature there is paying $10 a year 

for the next 4 years to subsidize the liability premiums of doctors 

in rural areas. That’s money that could be used for health care that 

isn’t currently being used. 

20

Chairman HATCH. I understand some hospitals are hiring doctors 

to avoid the medical issues, because the doctors have the insurance. 

Dr. SORENSON. I’m not aware of that, Senator. Intermountain 

Health Care employs about 450 physicians in its physician group 

and insures those physicians, but the costs of the professional liability insurance is considered in the terms of their practice costs. 

We try to compensate our physicians according to the market. And 

so they are affected by the rising costs. 

Chairman HATCH. But you have to have medical liability insurance, and the doctors do, too. 

Dr. SORENSON. That’s correct. 

Chairman HATCH. And if there’s an unfortunate result and litigation is brought, it is probably brought against both of you, isn’t it? 

Dr. SORENSON. That is correct. 

Chairman HATCH. And you have a whole raft of other— 

Dr. SORENSON. Usually the hospital gets drawn into cases because it is perceived as the deep pocket, even when the hospital 

may have had minimal contact with the patient. And at least in 

our case, many cases are ultimately dismissed but after very expensive and lengthy litigation. 

Chairman HATCH. Let me ask you another question. What would 

be the consequences to IHC, Intermountain Health Care, or even 

the state of Utah if we continue to experience the inability to recruit and retain certain specialties such as obstetrics, neurosurgery, or orthopedic surgery? And are we facing that? 

Dr. SORENSON. Yes, we are currently facing that, as Dr. Rich indicated. And particularly in those specialties that are most acute; 

in things like neurosurgery, trauma surgery, orthopedic surgery, 

plastic surgery. Those things that involve our trauma centers, our 

emergency room. We are having a hard time because a decreasing 

number of physicians are unwilling to take calls in that setting. 

They recognize that there’s a high risk of litigation involving these 

very complicated cases. Even in cases, as I mentioned in my testimony, where the care was according to the best national standards, 

if there’s a bad outcome sometimes judgments are rendered based 

on the bad outcome alone, not based on whether or not best practices were followed. 

Chairman HATCH. That’s interesting. What you are saying is the 

doctor may have practiced the highest standard of medical care, 

but because this is not an exact science, somebody for some totally 

unrelated reason or just because they have gone to him in the process, had some condition that was not the fault of the doctors in any 

way , or that nothing was the fault of the doctors, but the unfortunate result results in litigation. And who knows what the juries 

will do with those cases because it’s much easier to identify with 

the person who has had the unfortunate result than it is with the 

doctor or hospital, the health care provider or nurse. 

Dr. SORENSON. That’s exactly right, Senator Hatch. And that’s 

why we are experiencing the shortages and we predict even greater 

shortages in those specialties that deal with most difficult patients; 

patients whose injury or disease has a high risk of a poor outcome, 

regardless of how good the care is. 

21

Another interesting thing, and Dr. Rich and I were talking about 

this. If you look at the most respected neurosurgeons in the United 

States, or trauma surgeons or cardiac surgeons or orthopedic surgeons, every one of them, virtually every one of them has been sued 

multiple times. These are the physicians that we, as physicians, 

would go to. And there is not a correlation between bad physicians 

and the frequency of lawsuit as much as there is a correlation between specialties and how often people are sued. 

Chairman HATCH. Dr. Rich, I think you have been eloquent with 

regard to Utah’s problems in retaining or acquiring or enlisting or 

supporting neurosurgery and neurosurgeons in the state. Are you 

suggesting that the number of neurosurgeons in Utah will continue 

to decrease unless we solve this medical liability process? And 

maybe you might tell us what that means if we don’t have access 

to the neurosurgeons. 

Dr. RICH. Well, I think there are two observations— 

Chairman HATCH. First of all, I think it’s fair to say that neurosurgeons is one of the most specialized, all of these are specialties, 

but neurosurgery is one where there is much more likelihood of 

having an unfortunate result that had nothing to do with the ability of the doctor. Am I fair in saying that? 

Dr. RICH. Well, in some of the brain tumors, in some cerebrovascular anomalies, in some spine disorders there’s a risk inherent 

in the procedure, known well before the procedure, that it can be 

done absolutely correctly, seemingly go perfectly well during the 

procedure, and there can be an unfavorable outcome. 

Chairman HATCH. In every case the patient is informed that this 

could happen. 

Dr. RICH. Yes. But believe me, Senator Hatch, I have known 

from neurosurgeons who just are emotional basket cases when that 

happens. It is not as though this is something that anyone ever 

comes to the point where they get used to it. 

But the bottom line is that if there isn’t some limit, then you are 

going to have a very fundamental problem. It’s not a spigot that 

you can turn on and off. I didn’t finish my neurosurgical residency 

until I was 35. My son has now gone into neurosurgery and he 

didn’t finish his residency until he was 35 years old. So if you take 

that long to train people to do this and then we have all heard 

today that medical students are more and more risk averse and 

they are responding to the appropriate incentives and they are not 

going to go into these, as was just said the real alarm is to look 

down the road and say, is the time going to come when someone 

who today just assumes that if their mother has had a cerebral 

hemorrhage and goes to an E.R., they are going to have a two-hour 

rapid intervention and have done whatever needs to be done? I 

think anybody who knows the landscape here knows that the numbers don’t look good, either in terms of the number of people who 

are entering that field or the perverse incentives that are taking 

people who are still well within their capacities to practice that are 

incentivized to leave practice. So I don’t think there’s any question 

that if this isn’t addressed that it’s going to result in a real man 

power problem for highly specialized surgical subspecialities. 

Chairman HATCH. Especially less and less neurosurgeons in the 

state of Utah to help with these very serious cases. 

22

Dr. RICH. I think it’s inevitable. 

Chairman HATCH. It’s a matter of great concern to me. You have 

indicated that you didn’t or you really didn’t finish your, was it, 

until you were 35 years of age? 

Dr. RICH. That’s correct. 

Chairman HATCH. That means if you take an average person, at 

18 you graduate from high school, 4 years of college at 22, 3 years 

of medical school. Right? 

Dr. RICH. Four years of medical school. 

Chairman HATCH. Four years of medical school. That’s 26. 

Dr. RICH. All neurosurgery residencies are 6 years; some are 7 

years. 

Chairman HATCH. You have 26 plus six, that’s 33. 

Dr. RICH. A mission and military service. 

Chairman HATCH. I see. But the average neurosurgeon is going 

to be 32 or 33 before he or she is ready for practice. 

Dr. RICH. That’s correct. 

Chairman HATCH. It not only means that you have to sacrifice 

from 18 years on up—and I take it during these years of residency, 

you are not being paid astronomical sums of money. 

Dr. RICH. At Johns Hopkins my rent was more than I was being 

paid. 

Chairman HATCH. The point is you sacrifice all the years until 

you get to the point where you are 32, 33, 35 in your case and your 

son’s case, and then your prospects are limited if there’s an unfortunate result so this— 

Dr. RICH. That’s correct. 

Chairman HATCH. And even if you start at 35, you are going to have to pay $91,000 for liability insurance. 

Dr. RICH. The UMIA does something I think is very—it lets you 

work up over 5 years, knowing that you have just barely entered 

practice. But within 5 years, you are going full bore. And for the 

guys around here, that’s about $100,000. 

Chairman HATCH. Doctor, how many of you have left practices or 

even limited their practices due to medical liability insurance in 

this particular what you consider to be a crisis? 

Dr. RICH. Citing myself as an example, I would be happy to work 

in a limited environment. But with the overhead that high, one has 

to make a decision whether you can afford to. 

I think the other is the example I gave of a very contributing 

gentleman willing to cover this very onerous regional trauma center who, when St. Paul went out of business, he went out of business. And when he went out of business we went from an every 

sixth to an every five night call schedule. 

Chairman HATCH. With someone like you who has this experience but wants a limited practice but would like to keep helping 

people, with someone like you if you wanted to go work, say, in a 

rural area or some charitable medical group helping the poor, do 

you have any sense to do that? 

Dr. RICH. I think a lot do. The gentleman who went out of practice and is no longer covering the trauma center is in Mongolia on 

an LDS mission. 

Chairman HATCH. I’m talking about within this country. Because 

if you can’t afford the $91,000 of insurance, you are really risking 

23

your home, your family, and everything else that you accumulated 

over the years. 

Dr. RICH. You can stay busy. I’m going to be an examiner for the 

American Board of Surgery. I still serve on boards and committees. 

Chairman HATCH. But that’s different from operating on people. 

Dr. RICH. Can’t afford to do that. 

Chairman HATCH. Well, we can’t afford to lose people like you. 

And I know you very, very well and know how competent you are. 

And, like you say, you have never been sued for medical liability 

in all the years of practice. And yet you can’t afford —you are at 

the top of your profession. You have a number of years. I know doctors who are doing an awful lot of great work into their seventies. 

Some even in their eighties. The famous heart physician down 

there in Houston. 

Dr. NELSON. Dubecki? 

Chairman HATCH. I know him personally and I watched him perform open heart surgery once. And he is almost a hundred years 

old and still giving services all over the world. But doctors just 

can’t afford to do it, can’t afford the insurance. 

Dr. RICH. That’s why I agree with the comments being made 

about it being a broken system. You depend on the incentives being 

correct, and then you work for the public. And the incentives are 

bringing about results that do not conform to what benefits them. 

Chairman HATCH. Dr. Granger, how many of your colleagues and 

students, well, students and residents and so forth, have changed 

their hoped-for specialties because of medical liability concerns? 

Dr. GRANGER. I think there’s a significant impact on medical students deciding what specialty to practice. Dr. Nelson mentioned 

even in our own university in 2002, no students chose to go into 

obstetrics because of the medical liability crisis. And in 2003, I 

think there were two, but one of them was going to go into gynecological practice and not practice obstetrics. So in 2 years we entered one student into obstetrics. That’s a small percentage and 

there’s certainly a greater need there. And then in the surgical 

training here at the University, we have five residents every year 

that are chosen to go into surgical specialties. 

Chairman HATCH. General surgery. 

Dr. GRANGER. And two of the five jumped out after 1 year and 

changed completely what they were going to do because of the concerns regarding medical liability. 

Chairman HATCH. Referring to Dr. Nelson, he talked about how 

few are going into obstetrics today and they are not even trying 

medical school. It seems to me we can’t afford that. 

Dr. NELSON. When I was a resident we had 20 percent of our 

class going into obstetrics and gynecology. It is such a deep problem. There isn’t time to go into it all here today. But I was decrying 

to one of my Canadian colleagues the day before yesterday in Toronto the issue that we are not even teaching residents by best 

practice anymore. We are teaching how to protect themselves in 

case of a liability suit. Seventy-five percent of doctors are saying 

that the way they practice is affected directly by the concern, the 

fear of liability. 

Chairman HATCH. I estimated about $300 billion, and this was 

twenty years ago, $300 billion, and this is the testimony of someVerDate 0ct 09 2002 08:16 Oct 27, 2004 Jkt 096460 PO 00000 Frm 00027 Fmt 6633 Sfmt 6633 S:\GPO\HEARINGS\96460.TXT SJUD4 PsN: CMORC
24

one in the field, of procedures that were unnecessary. We want to 

practice defensive medicine when it’s necessary to do the best you 

can. But I’m talking about unnecessary defensive medicine. Do you 

think I’m that far off? 

Dr. NELSON. I think you’re low. 

Chairman HATCH. And that was twenty years ago when I said 

that. 

Dr. NELSON. Seventy-five percent of doctors said the way they 

practice is being affected, and they thought 95 percent of their colleagues are being affected. 

Chairman HATCH. Let me ask a tough question. In my practice 

I saw the wrong leg taken off. Clearly negligence. The wrong eye 

taken out. And I have seen other similar things. How do you solve 

the problem in those cases where there should be pretty high noneconomic awards? Clearly negligent. 

Dr. NELSON. Fairly and completely. When something like that 

happens, a physician is negligent and should be held responsible. 

Chairman HATCH. I have seen the wrong kidney taken out. You 

only have two. You have to have two legs, two eyes. What do we 

do about that? 

One of the problems that I see in the current legislation in Con- gress is that the $250,000 or $300,000 or $500,000, and I expect 

it will go up to at least $500,000 in non-economic expenses. But in 

other words all the non-economic costs including lost wages and so 

forth can all be reimbursed on the economic damage side. But what 

do you do about the pain, suffering, inconvenience, and loss of 

health, life, and so forth? 

Dr. NELSON. You pay something for sure. 

Chairman HATCH. What do we do? 

Dr. NELSON. You pay an amount. We need to fund a system that 

is fair. If you are my patient and I give you Ampicillin which I 

have given you before, but this time you have a reaction where 

your kidney shuts down, your heart stops, you are very injured. 

Did I make a mistake? No. Was I at fault? No. But what happens 

is because you are injured you are likely to be compensated. We 

have to differentiate between those things. 

Chairman HATCH. So many could get compensated who never 

really would get compensated otherwise. 

Dr. NELSON. Right. It’s an issue of equity. And the equity is people ought to get the money due them when they are injured, for 

sure. But if there is going to be a system where everything that 

could go wrong can be compensated, that can’t be on the backs of 

only the physicians. 

Chairman HATCH. My question is a little bit different than that. 

My question is this is a system that should be fair. And the wrong 

leg is taken off, the wrong eye taken out, the wrong kidney taken 

out, shouldn’t there be an ability to go beyond whatever the cap is? 

I think there should be a cap. The question is should there be an 

ability to go beyond that cap in those really egregious negligent 

cases? 

Dr. NELSON. No, there should not be. 

Chairman HATCH. You don’t think so? 

Dr. NELSON. No, sir, I don’t. And the reason I don’t think there 

should be is we already allege and assert we are willing to pay 

25

every single farthing for the economic damage, and something for 

the non-economic part. If there’s punitive damage because the person does something willful, that’s a punitive issue. That’s a criminal issue. 

Chairman HATCH. Again, you are talking about punitive damages, and that’s more than the cap. 

Dr. NELSON. Punitive damages, we have no argument with that. 

We are talking about the liability only. 

Chairman HATCH. Then what you are saying is, if I interpret it 

correctly, and you correct me if I’m wrong, is that where there’s a 

clear cut gross negligent situation like the wrong leg, wrong eye, 

where there’s a clear gross negligent situation, I wouldn’t call it punitive damage, but there could be more damage if they can prove 

that. Yes? Go ahead. 

Dr. LEE. I feel strongly, too, about a fixed cap, and I feel strongly 

about what I have watched the last 30 years. I stated in my early 

discussion that we don’t have a perfect system. I don’t believe we 

will ever get a perfect system, based on all the variables that are 

in play. But we have to have a reasonable system, a system that 

works very well. 

Chairman HATCH. For the vast majority of the people. A utilitarian stem. 

Dr. LEE. If we take one example out of the millions, we come up 

with the wrong conclusion. We look at what does public policy have 

to do for all the people being served? The difficulty with a cap, 

when you don’t have a very fixed cap, the cap is incentive to get 

cases fixed early, not to go off frivolous cases. If you multiply the 

financial impact of the cap across the entire process, it’s much 

broader and deeper than just is it $250,000 or $500,000? And I 

think in California, what we have seen is the ability to resolve 

cases very, very quickly, half of the time it takes in the rest of the 

country. An ability to get— 

Chairman HATCH. And a more fair basis. 

Dr. LEE. An ability to get more of a percentage of the award to 

the patient on a fast, predictable way. And it’s the entire package 

of the cap plus the other parts of MICRA. If we start to unravel 

one part of MICRA and then another, you openly get into a new 

system which hasn’t been tried. We have no evidence that it is 

going to work. And we do have a system right now that has had 

30 years of experience that has been very predictable. 

Chairman HATCH. And I take it innovative lawyers will find a 

way around it. If you have a gross negligent provision, lawyers will 

find a way around that. So that everything is gross negligence. 

Dr. NELSON. Our thinking is when there’s a hole in the limit, 

there’s no limit. 

I would point out this in closing. Seventy percent of lawsuits 

brought against physicians go away without no payment to anybody. It costs about $40,00 per case to make that happen. Of those 

that do go to court, 80 percent of the time the jury finds in favor 

of the physician. That costs about $90,000. 

Of those where there’s a payout, in addition to the payout, the cost is $328,000 per case. There are 125,000 medical liability cases 

in court in any given day in this country. There are not that many 

bad doctors. This system is broken. We hope this will be a great 

26

first step to go to a better system. Your point is one we need to 

be discussing. What is a better system? A medical court? An administration system? Something like a Workmen’s Comp, some 

other plan. But right now the patient is hemorrhaging. If we don’t 

stop this hemorrhage, there won’t be a patient. 

Thank you very much. 

Chairman HATCH. This has been great. I have had a lot of hearings through the years on issues like this and this has been one 

of the best panels I have ever seen. And all decent, honorable people who have expressed, I think, the problems as well as they could 

be expressed. I’m indebted to you, to you taking this time, and I 

really appreciate it. You have helped a lot of people understand 

this better. Keep working on it. And we appreciate all of you and 

we will let you go. Thank you. Appreciate you coming up. 

[Recess.] 

Chairman HATCH. On our second panel we have Ms. Donna Page 

of Park City Utah whose bacterial infection was repeatedly 

misdiagnosed; who was one of the torchbearers for the Salt Lake 

City 2002 Olympics, and we are grateful to have her here. If she 

would come, we would appreciate it. 

Next we have Ms. Karla Glodowski whose son went into the hospital with a cut fingertip and left the hospital severely disabled. We 

are very interested in hearing these two witnesses. 

And finally we have Mr. Charles Thronson who is representing 

Utah Trial Lawyers Association, and we are glad to have him here, 

as well, and look forward to taking this testimony. 

Start with you, Ms. Page. Thank you so much. 

Ms. PAGE. Thank you. 

Chairman HATCH. Look forward to hearing from you. Mr. 

Thronson, grateful to have you here. 

Mr. THRONSON. Thank you, Senator. 

Chairman HATCH. And get Karla and her little boy here. We appreciate that. 

Ms. Page, we will start with you. 

STATEMENT OF DONNA PAGE, PARK CITY, UTAH 

Ms. PAGE. Thank you, and I appreciate you listening to my testimony. 

In January of 2000, I was an extremely healthy— 

Chairman HATCH. Pull that microphone closer, right about there. 

Ms. PAGE. I was an extremely happy 63-year-old woman. I had 

my own successful tax preparation business and many hobbies. My 

husband and I enjoyed skiing, hiking, tennis, working out with 

weights, and we also traveled. Loved theater, loved dancing, and 

had lots of other activities. 

Six months before this, I competed in the Honolulu Tinman 

Triathlon, which consists of a half mile ocean swim, a 25 mile bike 

ride, and a 6.2 run. I was in very good shape. 

Chairman HATCH. That’s very impressive. 

Ms. PAGE. On February 17, 2000 I didn’t fell well, which was 

very unusual for me because I’m always healthy. I seldom go to the 

doctor but I am health conscious and will go if I think there is a 

problem. One lesson I learned from this experience was never let 

a doctor put you off. If you are sick, make sure you don’t let a medVerDate 0ct 09 2002 08:16 Oct 27, 2004 Jkt 096460 PO 00000 Frm 00030 Fmt 6633 Sfmt 6633 S:\GPO\HEARINGS\96460.TXT SJUD4 PsN: CMORC
27

ical professional minimize the problems. I had a high temperature 

and went to the clinic. The doctor told me simply to take Tylenol 

and sent me home. 

The next day I was very feverish and felt much worse. My husband took me to a large hospital emergency room in Salt Lake City 

where I spent the entire day. During the day my fever spiked at 

over 106 degrees and my blood chemistry deteriorated, which I 

later learned are clear signs of a major infection. At the end of the 

day the doctors did nothing and sent me home again with no further instructions. 

The third day I was deathly ill and I could hardly walk. I went 

back to the clinic in Park City and the doctor recommended I take 

Gas-X and once again sent me home. 

Early in the morning of February 20, we went back to the hospital emergency room and exploratory surgery was performed. The 

doctors came out of the operating room and told my husband to get 

my family together as I would not survive the day. That began the 

battle that would change my life. 

It turned out I had a Strep A infection that had been 

misdiagnosed for the last 4 days that was shutting down my body. 

I spent the next 2 months in a medically induced coma. It was necessary to amputate both my legs below the knee, all the fingers 

and part of the right hand, and most of the fingers on my left hand. 

I was very close to death many, many times. 

On top of that, as I was finally recovering, a nurse stuck a feeding tube in my lung and filled my lung with feeding solution, causing a respiratory arrest. If I had received medical treatment that 

I needed when I first went to the emergency room, these horrific 

things would not have happened to me. 

After 4 months, I left the hospital to face the challenges of a very 

new life. We are not ‘‘lawsuit type people,’’ if there is such a thing 

like that in Utah. I did receive very, very poor medical attention 

that would change my life forever in awful ways. After much discussion and soul-searching, we decided to file a lawsuit as we knew 

our financial needs were going to be quite different than our original retirement plans. 

A cap of $250,000 would not have come close to solving our problems. We had a lovely home but had to sell it because it had three 

stories, and that does not work if you don’t have legs. Also, remember that insurance companies and even Medicare want to be at 

least partially repaid if a settlement is received. And lawyers cannot work for free. 

This illness used up most of my medical insurance. For once I 

was lucky to be old and able to apply for Medicare less than a year 

after leaving the hospital. What if I had been 54 instead of 64? I 

now have Medicare but I must purchase the most expensive supplement insurance available as my legs, which are replaced every 

several years, cost $40,000 plus, and the accessories necessary to 

make them work cost several thousand dollars a year. 

There are so many things I need that are not covered by insurance. I need special equipment to turn on lamps, to hold a pencil, 

and a million little other things. The tax preparation business I 

had nurtured for 40 years, and the income from it, are a thing of 

the past. I am blessed with a loving husband who takes wonderful 

28

care of me, however he is almost 9 years older than me and odds 

are I will outlive him. In many years my illness aged him a lot 

more than it did me. 

I cannot live alone. I’m very independent but there are so many 

things I just cannot do. Simple things like lifting a pan of water 

from the stove to the sink, or trying to cut big pieces of meat are 

beyond my capabilities. There are doors and windows that are 

more than I can handle. I used to hop on the kitchen counter to 

reach high cabinets, but that’s out of the question now. I don’t 

want to ever be a burden to my children, but if something happens 

to my husband, this is a real possibility. 

After my illness, I applied for long-term care insurance. But to 

no one’s surprise I was uninsurable. The settlement I received in 

my lawsuit did not make us rich but it will be my long-term care 

insurance. 

Two years ago, after I was misdiagnosed and had to have all my 

amputations, I was asked to carry the Olympic torch as it come 

through Park City and that was probably one of the biggest honors 

in my life. Because I have no fingers left we were able to strap the 

torch to my palms and that’s how I carried it. 

I’m a survivor and I’m not a complainer but I seriously doubt 

that anyone here today actually believes that a $250,000 damage 

cap is fair compensation for the pain and suffering that I and my 

entire family have gone through and will go through for the rest 

of our lives. And I seriously doubt that anyone on the panel, you, 

Senator Hatch, or the doctors that were here in this audience, 

would think that a $250,000 cap was fair if they had a wife or child 

that had to have their legs and fingers amputated and live the rest 

of their lives that way as a result of medical negligence. Thank 

you. And if you have any questions, please ask. 

[The prepared statement of Ms. Page appears as a submission for 

the record.] 

Chairman HATCH. Thank you. I appreciate you coming, and appreciate you bearing that torch, too. 

Ms. PAGE. Thank you. 

Chairman HATCH. You’re clearly a very good person. 

Ms. PAGE. Thank you. 

Chairman HATCH. Ms. Glodowski, we want to hear about you 

and your son. 

Mr. THRONSON. Senator Hatch, if you would let me show a short 

video of Christopher Glodowski which we will now show. This is a 

before and after video. 

[Video played.] 

Chairman HATCH. Shall we take your testimony now? 

STATEMENT OF CARLA GLODOWSKI, LEHI, UTAH 

Ms. GLODOWSKI. Thank you. On July 5, 2002, my 16-month-old 

son Christopher Karac Glodowski stuck his finger in my older 

daughter’s bike chain. She was unaware that it was there and the 

tip to first joint was cut off. We rushed him to the hospital and 

were told that he was a good candidate for replantation and we decided to have the medical team attempt the reattachment. 

29

Chairman HATCH. Would you read just a little bit slower, because you are excited and we can’t quite understand as well. I 

think I can, but I want to make sure everybody can. 

Ms. GLODOWSKI. Okay. Due to the lack of professionalism and 

the inattentiveness of the doctors, my son was allowed to suffer a 

bronchial spasm to the point of oxygen deprivation. He went into 

cardiac arrest and had to be revived with chest compressions and 

finally epinephrine. After this occurred, the medical team chose not 

to tell me what had happened to my son. They did not give me the 

choice to end an elective surgery to explore why my healthy son 

was responding this way. They continued with the surgery, and 

they took away my right as his parent. 

Karac did not come out of the operation with the appropriate responses. He was unable to awaken and could not breathe on his 

own. He had to be life-flighted to Primary Children’s Medical Center and he was subject to a battery of tests to determine why he 

was responding abnormally. Some of the tests included AIDS, blood 

tests for genetic disorders, MRIs, and additional surgeries for a 

muscle and skin biopsy. 

The second MRI showed he had suffered a severe anoxic brain 

injury. His body had gone too long without oxygen. He would never 

again be normal. 

Later as experts were hired and depositions were taken, we finally began to receive the truth about what happened to Karac. He 

has asthma, which the doctors knew before they operated on him, 

and he has a more sensitive airway than someone who doesn’t. 

When they intubated, he had a bronchial spasm and it was not 

treated right away with epinephrine. In fact, this medication was 

given last. He was allowed to cascade downward until he had a 

heart rate of 20 and no blood pressure. 

An independent handwriting expert had to be hired to prove that 

Karac’s charts were altered to look like he wasn’t in distress as 

long as he was. The charting has two periods in which nothing was 

charted. Karac was dying and the entire room of medical personnel 

was allowing it to happen. The very people that swore under oath 

that patient safety was their primary concern denied having any 

responsibility. 

I have not worked since this happened to my son. My employer 

was not supportive, and I was forced to quit my job. Due to the fact 

that I made a majority of our family’s income, we began to suffer 

severe financial difficulty. 

On November 10, 2003, we settled our case out of court for an 

undisclosed amount. I did not want to settle, but due to our situation it was the only way to guarantee that Karac would get the 

money to care for him for the rest of his life. In settling with the 

other parties involved, we had to agree not to mention the names 

of the medical personnel involved or the medical facility where it 

occurred. In essence, I feel we have to protect them and their identities when they should have protected my son. 

And in protecting their names I have learned from their co-workers that they still do not show remorse or acknowledge guilt. In 

fact, they are stating that my son came into the hospital in the condition he is in now. 

30

I’d like to tell you more about my son, Christopher Karac, and 

the incomprehensible effect this has had on my family. We call him 

either Bubba or Karac. My husband named Karac after Robert 

Plant’s son. Robert Plant was a member of the rock group Lead 

Zeppelin. His son died at the age of 5 of a mysterious virus and 

Robert Plant co-wrote a song, ‘‘All of my Love,’’ as a way of overcoming his grief. This song has now come to mean a lot to myself 

as well. Although my son is still alive, on July 5, 2002, the medical 

personnel that operated on him killed the boy he was supposed to 

grow up to be, and left a hurt and damaged shell. 

Prior to July 5, Karac was full of energy. He loved to play catch, 

interacting with his sisters and eating. He was quick to laugh and 

smile and was full of life. Now he is quadriplegic, suffers from cortical blindness. He cannot eat normally and must receive his nutrition through a tube in his stomach. He has a baclofen pump implanted under his skin with a catheter threaded into his spinal 

cord. This mechanism delivers a constant supply of medication to 

his body to help control muscle contractions. He suffers from high 

blood pressure, reflux, irritability, and has difficulty sleeping. The 

quality of Karac’s life has been horribly altered. He is committed 

to a life of pain and frustration. 

A few of the things not taken from him are his smile and laugh 

and his love for his family and music. Ironically, his favorite music 

is Lead Zeppelin. 

This has also had an acute effect on my daughters. My oldest 

daughter, Kielee, still displays problems with guilt. She wants to 

know when Karac’s finger is going to grow back. She wants to 

know when he is going to get better and walk and talk. She has 

moments when she will become thoughtful and when I ask her 

what is wrong she will cry and tell me that she will never hurt 

Bubba again. She is unable to separate the accident with the bike 

and the monstrosity that actually happened to him at the hospital. 

They are linked together in her mind. 

Kiera is five and just learning to read. She was eating a piece 

of Laffy Taffy in the car and read me the joke. ‘‘What has two legs 

but can’t walk?’’ I thought about it for a moment but did not come 

up with the answer. Kiera came up with her own answer. She said, 

‘‘Bubba.’’ I started to cry and could not drive through my tears. I 

do not know what the true answer was, but hers is forever burned 

into my mind. 

My husband has lost his namesake and his baseball player partner and he has quietly dealt with what has happened to Bubba. He 

has been forced to continue to work a dead-end job because we 

have to keep medical insurance. And when he does break down, he 

tells me that he let Bubba down. He was supposed to protect him 

and not let anything bad happen to him. 

And as for myself, I despise the person who coined the cliche, 

‘‘Time heals all wounds.’’ I know I will not live long enough to heal. 

To this day, I still cannot talk about what happened to Bubba without breaking down. The day that Bubba’s finger was cut off, I was 

trimming the rosebushes around our house and I remember thinking that the sheers were sharp and I needed to put them away 

properly so the kids wouldn’t cut themselves. And at that point I 

31

heard Chris yelling. I believe God was trying to tell me something 

was going to happen, but I didn’t listen. 

We recently found out we are going to have a new little baby boy 

in September. This should be an extremely happy time for all of 

us, but I can’t help crying. I keep wondering if this is a way to replace Bubba, and somehow get raising him right this time. It’s so 

hard to be happy when I’m worried all the time. I’m worried about 

dying before Karac, and having him die before myself, and being 

physically unfit to care for him. I stress about the girls being emotionally scarred and I’m concerned about spending enough time 

with them. I do not want them to resent Bubba. It also saddens 

me to know that every Saturday our family time includes everyone 

but Bubba. He is left home with a nurse. Our family has been destroyed. 

The money we received in this settlement has done nothing to 

help put our family back together, but it has taken away the financial burden. I have been able to purchase additional therapy equipment for him, receive additional therapies, and it will help assure 

that Karac will have the best quality of life possible. 

I cannot fathom the thought of anyone thinking that putting a 

cap on the amount awarded to families who have been victimized 

by malpractice will solve anything. In my eyes, it’s an attempt to 

victimize the innocent even further. My son’s life did not come with 

any dollar sign attached. Although he wasn’t important to those 

who operated on him on July 5, he is important to me and he can’t 

be replaced. 

Damage caps only hurt the people who are the most injured. Our 

claim was not frivolous or a junk lawsuit. The only junk in this 

case was the quality of medical care Karac received. I want those 

of you who are voting on this topic to consider how you would vote 

if this was your son. Should you protect innocent babies like Karac 

or doctors that lie and alter records? My son had to undergo many 

additional tests and surgeries because of their deceit. 

I would give anything to have my son back. In my eyes the doctors are replaceable. Don’t let this happen to your family before you 

make the correct decision. Make it now. Doctors already have more 

protection than anyone else. Protect families. Reform insurance 

companies and hold bad doctors accountable. Do not continue to 

victimize those who have already lost so much. Make the right and 

only decision. 

[The prepared statement of Ms. Glodowski appears as a submission for the record.] 

Chairman HATCH. Thank you. We appreciate you taking time. 

Appreciate you bringing your son with you. Appreciate very much 

the pain and suffering you have gone through. Mr. Thronson? We 

will turn the time over to you. 

STATEMENT OF CHARLES THRONSON, UTAH TRIAL LAWYERS 

ASSOCIATION 

Mr. THRONSON. Thank you, Senator Hatch. 

As many times as I have seen this, it is still hard for me to 

watch this video. And as many times as I have talked to Karla, it 

is still very difficult for me to hear the story again, even though 

I handled her case. 

32

You just heard the heartbreaking stories of two of my clients. 

Unfortunately, these families were not alone in their tragedy. I 

have walls in my office full of photographs of people like Christopher and Donna. Preventable medical errors like those happen 

far too often in Utah and across the United States. In fact, a new 

study puts the number of people who die each year in the U.S. 

from preventable medical errors at 200,000 Americans a year, up 

from an earlier study by the Institutes of Medicine—not an attorney’s group; the Institutes of Medicine—showing upwards of 90,000 

dead, making medical mistakes the third leading cause of death in 

the nation, behind heart disease and cancer. This is the equivalent 

of two 747 crashes every day in this country. Every day of the year, 

year in and year out. And that does not include the hundreds of 

thousands who are injured like Christopher or Donna who are not 

killed outright. 

The real crisis is not medical malpractice litigation. The real 

problem is medical malpractice. Overworked nurses, exhausted 

residents, fewer staff per patient, use of paraprofessionals, medication errors, and the list goes on and on. 

When we talk about our healthcare system and how to make it 

better, and we talk about altering our time-tested justice system in 

which you have been a long-time part of, we would all be well advised to keep these people, these families at the front of our minds. 

Tell these people that their claims are frivolous and their lawsuits 

are junk. 

I think we can all agree that if something like the catastrophic 

loss these two patients suffered happened to someone in our families, we would all want full justice and accountability. We would 

want a fair shake. We would want the specifics of the case to be 

heard by a jury of people like us. Our citizens, our neighbors, people who pay their taxes and vote. People who put up their flags and 

send their sons to fight for us. Ordinary people. Entrusted people. 

We wouldn’t want some one-size fits all mandates from the Federal 

Government, putting a value on the life and suffering of a loved 

one no matter how shocking the case or horrifying the long-suffering. 

Senator it is easy not to question the apocryphal stories of doctors begging on the streets because their malpractice insurance is 

too high. It’s easy to latch onto a few highly publicized cases of justice gone awry, and I’m not denying that there are some cases 

where that’s happened, although those are in the extreme minority. 

It is easy to accept urban legends as fact. In short, it becomes easy 

to lose sight of the real facts and the best interest of real people. 

I’m going to ask you to consider a few statistics before you think 

about limiting the rights of those people who have been truly injured. First, contrary to the claims of those seeking what some call 

tort reforms, there in fact has been no explosion of lawsuits in liability cases generally or in medical malpractice cases specifically. 

The Department of Justice’s Bureau of Justice statistics report the 

number of tort lawsuits decreased by 31.8 percent between 1992 

and 2001. That word is ‘‘decreased’’ by 31.8 percent. 

According to the National Center for State Courts, medical malpractice filings per capita decreased by 1 percent between 1998 and 

2002 when this alleged crisis supposedly was occurring. And acVerDate 0ct 09 2002 08:16 Oct 27, 2004 Jkt 096460 PO 00000 Frm 00036 Fmt 6633 Sfmt 6633 S:\GPO\HEARINGS\96460.TXT SJUD4 PsN: CMORC
33

cording to the National Practitioner Databank, which requires all 

physicians to report a payment in a medical malpractice case, according to the Databank the number of malpractice payments 

dropped 7.7 percent from 2001 to 2002. And the Government Accounting Office calculates the total cost of malpractice litigation—

that is when the claim is filed, the attorneys’ fees, the defense 

costs, expert witnesses, trial, everything—is substantially less than 

2 percent of all health care costs. A proverbial drop in the bucket. 

This is hardly an explosion or crisis. 

Senator I find it interesting that there are no insurance company 

executives here today. It would be even more interesting to put 

them under oath like the Senate did with the tobacco executive industries and ask them why, when there is no evidence of a crisis 

or runaway juries, they increased liability premiums 30 to 60 percent in 1 year. Property and casualty insurance profits last year 

rose 900 percent. What a fantastic business. As an industry, you 

can increase premiums as much as you want for essential liability 

coverage; blame the increases solely on the people who have already been injured or killed, and of course on the attorneys who 

represent them; have your insureds, the doctors, accept this admittedly phony explanation lock, stock, and barrel; and have Congress 

and the various state legislatures rush through legislation to fix a 

problem that never existed in the first place, thereby guaranteeing 

your profits and hurting the injured people that the insurance you 

were selling was theoretically designed to help. 

The bottom line is—and I have practiced in Utah for almost 30 

years. There has never, ever been, in the state of Utah, a verdict 

in a malpractice case that can, by any stretch of the imagination, 

be called a runaway or excessive verdict. Ever in the state. And 

this is the same situation in most states. There are always some 

exceptions. Like we always say, ‘‘Yeah, but that’s not Utah.’’ And 

this is the same story in most states who are facing the same push 

by the insurance industry and medical lobbying. 

The CBO, Congressional Budget Office, has found that recent increases in malpractice premiums are as much linked to market 

fluctuations and poor investments by insurance companies as they 

are to payouts and malpractice cases. And claims the doctors are 

leaving their practices in droves because malpractice premiums 

have not been substantiated. 

You will see in Dr. Nelson’s materials, he discusses a physician 

who has been well publicized in St. George who claims he had to 

leave his practice delivering babies. That physician has had a number of successful claims brought against him and he could no longer 

afford the insurance premiums because of his prior claims history. 

I don’t see that to be a crisis, other than perhaps for him. 

The Government Accounting Office investigated the situations in 

five states and reported problems and found mixed evidence. On 

the one hand, GAO confirmed instances of reduced access to emergency surgery and newborn delivery, albeit in scattered rural 

areas. On the other hand, it found that many reported reductions 

in supply by health care providers could not be substantiated or did 

not widely affect access to health care. 

Utah has always had a problem attracting physicians to rural 

areas. Some cities, for instance, Gunnison, has set up their own 

34

hospital and provided incentives to attract physicians down there. 

It’s always been a concern. 

The other issue is Utah medical insurance actively discourages 

family practice physicians from delivering babies. Why do they do 

that? Because the claims history for a family practice physician is 

much worse than board certified OB/GYNs. And I see Karac agrees 

with me on that point. 

Health care providers already have more protections than any 

other profession in virtually every state of the country. In Utah, 

and I know you know this well, physicians have a very short statute of limitations in which a claim can be brought; protections on 

informed consent; a notice of intent requirement; a prelitigation 

screening process; requirements for qualified expert testimony before a physician can be held liable; and you have to have an expert 

to even get to a jury or you will be dismissed on summary judgment; caps on attorneys’ fees that already exist in Utah, but only 

plaintiffs’ attorneys are capped, not defense counsel. They can 

charge whatever they want. Not that you did. But they can. 

Caps on general damages. We had a damage cap here. It was fi- nally adjusted a couple years ago only for inflation from a $250,000 

cap that was enacted in 1986. Cap on judgments against state-run 

health care facilities; no collateral source rule; and a provision that 

any judgment against a physician must be paid over time rather 

than as a lump sum, among other special interest protection. 

You have heard about MICRA and the physicians touting what 

a success MICRA has been. Utah has most of the provisions that 

MICRA has, including caps on attorneys’ fees. The one provision it 

doesn’t have is a sliding scale attorneys’ fees. And it is so interesting to me to hear a physician say, ‘‘What we really want to do 

is get more money to the injured people,’’ while at the same time 

the same physicians are saying, ‘‘But we want to cap their damages, of course at 250,000.’’ The real reason they want sliding scale 

attorneys’ fees is to drive out of the practice qualified, experienced 

attorneys who have represented people in significant cases in the 

past, to make it economically impossible to continue. Because it is 

so expensive and so time-consuming to do these medical cases for 

free. 

All of this evidence adds up to the conclusion that our medical 

liability system is hardly in crisis. The famous Harvard Medical 

School study of 30,000 patients in New York, 30,000 patient 

records selected at random, this is Harvard Medical School, has 

found in reality that in seven cases of actual medical malpractice, 

only one—for every seven cases, only one claim of medical malpractice litigation was ever filed. 

Proposals to limit how much patients can receive as compensation for non-economic damages in cases of medical malpractice will 

not achieve their stated goal. Proponents of caps on non-economic 

damages say a Federal limit of $250,000 would stop frivolous lawsuits from being filed. But when a jury sees an error so serious 

that it justifies giving the victim more than $250,000 aside from 

lost wages and medical bills, that is, by definition, not a frivolous 

lawsuit. If your son or daughter ends up in a wheelchair for life 

because of a medical error, would you want a mandate from the 

Federal Government deciding what is fair in your case? Most 

35

Americans trust a jury of people like their fellow American citizens 

to make a better decision concerning specific facts of the case. 

Instead of limiting how much patients can be compensated when 

they suffer tragic losses, we ought to be trying to find ways to 

make our health care system better so that fewer mistakes are 

made. Solutions like requiring insurance companies to open their 

books to the public, and factually justify proposed high premium 

increases or mandatory reporting of medical errors or penalties for 

alteration or intentional destruction of medical records like we saw 

in the Glodowski case, and hospital systems and technology to reduce medical errors would all have far greater benefit to consumers 

than limiting access to the court system when an injury or death 

occurs. 

And I urge you, as you continue your discussions, and I know 

you will keep an open mind about improving our health care system. And as you consider proposals to change the way our justice 

system handles medical negligence claims, I want you to hold on 

to one thought. Imagine yourself, if you can, and I know how sympathetic you are to this issue, in the shoes of Karla Glodowski or 

Donna Page. Imagine the pain they and their families have suffered, and ask yourself what is truly fair for catastrophic victims 

of medical negligence? What is truly best for preventing the errors 

in the future? And what is truly best not for insurance executives 

or the medical lobby, but for the long-term health of the people of 

the United States. Thank you. 

[The prepared statement of Mr. Thronson appears as a submission for the record.] 

Chairman HATCH. Thank you. I want to thank all three of you 

for testifying today. It is important that people hear both sides of 

these issues, and I have tried to do that. I particularly want to 

thank you, Ms. Page, and you, Mrs. Glodowski. And of course are 

appreciative of having you here, Mr. Thronson, because I know the 

trial lawyers take a lot of abuse, and they give a lot of abuse, too. 

I have seen it both ways. And as a trial lawyer myself, I know how 

important some of the work is that is done by plaintiffs’ lawyers. 

It takes a lot of courage for you folks to be here today and talk 

about your personal stories. It means a lot to me. And I’m truly 

grateful that both of you would share these experiences with us for 

the record. And both of you have my deepest sympathy for what 

you have gone through, and what you have to go through in the 

future. And I know this hasn’t been easy for either of you to testify, 

but what you have done is important. 

But I would like to pose a question to both of you, and I think 

it is a question that is a fair one. I have been a strong supporter 

of placing caps on non-economic damages except, and there’s an exception, in the most egregious cases where there’s true gross negligence. In my opinion, each of your cases would fit in that egregious category. I don’t know all the facts and I can’t definitively 

state that, or categorically state that as totally accurate. But I believe that. 

Now, would you think that might be a way of solving this problem as you have heard the medical testimony here today, and I 

think they make a very good case that we are all losing because 

the system is out of whack, maybe both ways. But still out of 

36

whack. But if your cases were truly—and I believe them to be—

egregious cases, then if I had my way you would be able to get noneconomic damages, substantial non-economic damages. Ms. Page? 

Ms. PAGE. You know, this issue is so close to my heart that I 

don’t think I could probably give you a really fair answer. 

Chairman HATCH. That’s fair. 

Ms. PAGE. I couldn’t ever see a cap. 

Chairman HATCH. You would hate to ever see a cap in any way? 

Ms. PAGE. That’s right. 

Chairman HATCH. But you will give some consideration of my attempt or desire to try and solve these problems. 

Ms. PAGE. I thought what you said to the doctors was well said, 

and I saw their backs bristle. They weren’t having any part of it. 

Chairman HATCH. Keep in mind what they were saying is -and 

it’s true—that if they had a cap situation a lot of people who don’t 

recover today would recover. What I’m saying is, is the reality then 

in the truly bad cases like yours there would be no cap? Because 

there is a lot of data out here, a lot of cases brought that shouldn’t 

be brought. There are some that should be brought that aren’t 

brought. And there are some that should be brought that aren’t 

brought where damages should be more than $250,000 or $350,000 

or $500,000 or whatever the cap situation would be. 

How do you feel about that, Ms. Glodowski? Assuming that you 

would have a right to recover all the necessary damages that in 

your case justifies them because it’s an egregious case. 

Ms. GLODOWSKI. I think that creates a problem, too, because who 

is going to decide who has been hurt enough to not be capped? And 

then you have another little grey area where— 

Chairman HATCH. The same people who decide it today: The 

judges and the jurors. 

Ms. GLODOWSKI. I personally don’t think that— 

Chairman HATCH. I’m not trying to put— 

Ms. GLODOWSKI. Most of these malpractice cases are not even 

taken to trial. And then, because of the amount of insurance that 

these doctors had, we already basically were capped by the amount 

we could get. Because they were under-insured already. And then 

they took that as a starting point of what they could offer us and 

tried to talk us down. And I’m sure if it did go to court and we did 

get awarded more, they would have taken out bankruptcy and we 

would have lost anyway. So I don’t see how they are going to help 

anything. 

Chairman HATCH. Okay. Mr. Thronson, I respect you and respect 

the profession. I have been in your shoes. I started out as a defense 

lawyer. I understood how frightened defense lawyers can be and 

how difficult the job is. And I wound up doing both plaintiff and 

defense work. I have to say, I enjoyed the plaintiff’s work much 

more than I enjoyed the defense work and I was remunerated 

much more. It’s easier to—it’s not easier to do but it is much more 

enjoyable in many respects. So I respect many plaintiffs’ lawyers. 

There’s a lot of situations where I think the process is currently 

under abuse, and you know it and I know it. There are people in 

our profession who might not rise to the ethical level that you do 

who would do anything to make money. And I cite a particular 

area, an analysis done by top radiologists that a high percentage 

37

of these asbestos cases brought by Plaintiffs’ lawyers, a high percentage of the medical testimony that was given was fraudulent 

and false and that’s what gives us all a bad reputation. 

Let me just ask you this: Your position, as I understand it, is 

that the too high liability insurance premiums result from price 

gouging from insurance companies. Now, isn’t it also true that here 

in Utah, many doctors participate in self- insured ways, in self-insurance pools. And we still have a $91,000 premium for a neurosurgeon who has never had a case brought against him, and there 

are a number in that category, which caused Dr. Rich to retire because at his time and age he didn’t want to work full-time but 

couldn’t afford to work or it wasn’t worth the incentives to work 

part-time with that type of a high insurance payment. 

So I guess what I’m saying is that even though he hasn’t ever 

had a case brought against him, that didn’t cause him to retire earlier. Wanting a higher quality of life probably caused him to retire 

and so forth. But my point is there’s a significant number of Utah 

doctors who have participated in this self-insurance pool, so it isn’t 

the insurance companies that are going to necessarily cost him the 

$91,000 price for neurosurgeons. 

So what do you say to these doctors who are in this insurance 

pool, who are like Dr. Rich, and more importantly to the patients 

or to other doctors who are retiring because they can’t afford the 

premiums? What do we say to them? I would like to see the very 

best people stay in the profession as long as they can do a good job. 

And I know Dr. Rich and I know that nobody did a better job. 

Mr. THRONSON. Right. Let me address the issue, if I could, about 

Utah medical insurance, which is the Mutual Company owned and 

started by physicians, and it insures about 80 percent of physicians 

in the state of Utah. 

They are insured—they provide insurance up to about $300,000 

for a claim. And most, as I understand it, most of UMIA’s investments are in bonds, they really aren’t in the stock market. They 

are a very conservative company and they have a lot of investments, a lot of money stashed away. But then they go to the market and get reinsurance. And so they buy it from Lloyds of London 

or some of these AIG, some of these reinsurance companies. And 

that’s where the premium increases come from. It is because UMIA 

is being charged high prices by these reinsurance companies. 

Now, I’m a consumer of medical services. Dr. Nelson delivered 

three of my children. I don’t want people like Dr. Nelson to leave 

the practice. It seems to me that if there could be some kind of insurance reform which, by the way, nothing happened in insurance 

rates in California under MICRA until the California legislature 

adopted insurance reform and forced the insurance companies to 

identify and justify, just like utilities have to do and others— 

Chairman HATCH. Also understand there’s a number of insurance companies that won’t go to California because they don’t think 

they can make a decent enough profit. So those that were lost in 

California, some have stayed and some have left. 

Mr. THRONSON. That’s true. But as we have heard, the insurance 

situation is relatively stable in California, but primarily in terms 

of the insurance thing, because the state looks over the books and 

says, ‘‘Okay, this is justified,’’ or, ‘‘This isn’t.’’ 

38

Now, I don’t think it is justified to have a physician like Dr. Rich 

have to pay $91,000 who has never had a claim against him. Why 

they charge him that, I don’t have any idea. But there are physicians who have had multiple cases against them who probably 

should pay that. 

Chairman HATCH. Well, they charged him that because they presume some day he will have a claim against him because he is a 

neurosurgeon and there may be more than one claim. And some of 

the claims, as you and I both know, are frivolous. Some aren’t. I 

certainly think these two cases are not, certainly. But some are. 

And I have to admit, as somebody who defended some of these 

cases, I saw cases brought that should never have been brought. 

And they were brought because the insurance company, where 

there was insurance, or the doctor, where there wasn’t, couldn’t afford to take a risk in front of a jury that might run away or might 

be influenced by emotions that might cause an unfair verdict. 

Mr. THRONSON. Well, since you practiced and since that time, 

Utah has adopted all those short form measures. We have a 

prelitigation screening panel, we all have the tort reform gamut. 

Now, I’m not saying, and I would never say, that there aren’t 

cases that shouldn’t be brought. There are cases that shouldn’t be 

brought in every genre of litigation. 

One suggestion I have, which I haven’t heard before, is I would 

not be opposed to having a certification process for trial attorneys 

who practice in medical malpractice. It is so specialized an area 

that I think that if there was a state requirement here or national 

requirement to have attorneys who decide to practice in the area, 

plaintiff and defense, be certified and go through some sort of 

screening process and scheduling and classroom work, experiential 

level and so forth. To the extent that there are unskilled practitioners out there, it might solve the problem. 

I know what you are talking about with asbestos. It is a problem 

that there is junk science going on there. But in these cases, even 

though oftentimes defendants will say, ‘‘Well, even in Karla’s case 

they are still denying what happened.’’ It’s interesting. 

Chairman HATCH. And there’s both sides to these cases, too. You 

take, you know, this attitude that women should have babies by 

Cesarean because it might prevent cerebral palsy. You know that 

is junk science and I know it’s junk science. And yet millions and 

millions of dollars have been recovered by some doctors who testified because that’s their profession, who come in and say, ‘‘That is 

not junk science.’’ And because they have a medical degree, the 

courts accept them as experts in the field. Just like these radiologists who are certifying some aspect of asbestosis even though 

there is not the slightest indication of it. And yet in all of those 

cases there’s been recovery because of false testimony by some of 

these doctors who testify. 

Mr. THRONSON. You are talking about Utah jurors and Kansas 

jurors and Missouri jurors and North Dakota jurors. If some guy 

comes in— 

Chairman HATCH. I agree with you. I think in Utah we have a 

much fairer situation. If you go to Madison County, Illinois it’s a 

much different situation. 

39

Mr. THRONSON. Or some place in Alabama. If you get some guy 

that comes in— 

Chairman HATCH. And that’s not the only jurisdiction, as you 

know. 

Mr. THRONSON. —with white shoes and sunglasses and says, 

‘‘This is how this baby got injured,’’ they would be decimated by the 

highly qualified defense attorneys in town. Bruce Jensen, Elliott 

Williams, those guys that would come in. The guy would be thrown 

out of court and run out of town. You have to give some faith, I 

think, to the jury system to do the right thing. 

Chairman HATCH. I did have faith in it. As someone who tried 

many jury trials, I have faith in it. And certainly in an area like 

Utah where the people are practical and it’s plausible and so forth, 

and where I think the Bar, by and large, is responsible, like yourself. 

I’m just concerned, and I think you should be concerned, that our 

whole profession gets a black eye because of some of the situations 

throughout the country where attorneys exploit that and junk 

science is used. Sometimes it doesn’t even rise to the level of junk 

science. And you know that and I know that. And I guess what I’m 

saying is that—and I agree, Utah has had a number of reforms 

with respect to the past. Many were adopted in recent years such 

as the cap of $400,000, which is adjusted for inflation in Utah, 

index for inflation. Prelitigation training process, some or all of 

which you have mentioned. 

There’s no question, and Dr. Nelson testified that the medical 

malpractice premiums have risen more slowly in states that have 

had some measure of tort reform or some measure of this type of 

reform where states have instituted some measure of non-economic 

caps and other tort reform measures. 

I had problems in this area because when I see an egregious 

case, a wrong eye, wrong leg, and these two here, let me just say 

in cases I have personally seen, these cases were not handled by 

bad physicians. They were terrific physicians who just made mistakes, but they were egregious mistakes. And I don’t think a cap 

of $250,000 or even $400,000 in those cases or these cases is adequate. 

On the other hand, you and I both know that you can, through 

expert testimony, prove an awful lot of damages in the economic 

phase of it. And good attorneys are going to get reasonable results 

even with tort reform. What’s wrong is we have some who aren’t 

good attorneys, who aren’t honest attorneys, who are giving all of 

us a bad name and doing it just for money. And that’s the only 

thing I’m concerned about. If I had a magic wand and I could wave 

it and solve all the problems, I would do it. I appreciate any help 

you can give me in this area. 

I personally want to express my sympathy and deep feelings for 

you two women and your families. It took courage to be here today. 

I’m personally grateful you are here and took time to be here. Let’s 

work together and see what we can do to resolve the conflicts. I 

don’t think it helps the profession or most people who are injured 

to have people who—and I kind of agree with your idea about specialties in this field, that people ought to have to qualify, to be people of integrity who do those type of lawsuits. And I think it would 

40

help everybody and the verdicts would be higher, too, in the areas 

where they are justified. You wanted to say one other thing? 

Mr. THRONSON. I just wanted to comment on the cap issue you 

asked about. I think Karla is right. Most cases, probably 95 percent 

of my cases settle, and I think that’s close to what the average is. 

But what happens when we get to mediation or some sort of settlement conference is the Defendants say, ‘‘Well, look, $250,000,’’ or 

Donna’s case, it was $250,000 at the time. That’s all the jury can 

award you so that’s the number, and then we will negotiate down 

from that. So it becomes a hammer. 

Chairman HATCH. Sure. 

Mr. THRONSON. I can go in and say in Karla’s case or Donna’s 

case, this is an egregious case and they will say, ‘‘No, it’s not.’’ And 

so where do we go from there? I mean, I think we would be very 

willing to continue the dialogue and look at any of those things, but 

I think you have identified a significant area and that is this onesize-fits-all idea for a cap doesn’t fit all people. 

Chairman HATCH. Well, I agree with that. And the one-size-fitsall idea does help millions more who will never get help. It may 

be helpful but it still doesn’t justify these type of cases, I have to 

admit. 

Let me just say I have tried to solve these problems like the asbestos problem. We all know that the high percentage of those 

cases really should never have been brought. They are hurting the 

whole legal profession and we all know that everybody in society 

is paying the cost. Settling companies are already bankrupt, and 

these are the companies where the mesothelioma cases really were, 

where people are going to die. They get a nickel and a dollar from 

those cases, and some of the other cases that are brought are just 

fraudulent, to be honest with you. And some day, I’m worried that 

some day the whole legal profession, the Plaintiffs’ lawyers are 

going to get sued because of the undignified and unrighteous acts 

of those who aren’t as honest. 

In this particular area I have seen very egregious faults on both 

sides. I have seen attorneys who have brought in doctors who will 

say anything they want them to say. Not honest doctors. I have 

seen patients who had bad results where the doctors have done everything they possibly could and get huge verdicts because of some 

of the fraudulent testimony. But I have also seen folks like these 

who have not been compensated fairly and I don’t like that, either. 

And I wish I was an oracle and had the ability to solve problems 

with snapping my finger. I work at it and try to solve it but I need 

your help and I need the help of the first panel who have been very 

helpful in many respects. And we will have to keep working on it 

and see what we can do. But I want it to be right and I want it 

to be fair. 

Let me just close by saying after listening to today’s testimony, 

in my opinion I think we all have the same goal. The system that 

we all desire is one that leaves no injured person who has really 

truly been injured without remedy, but at the same time does not 

have a devastating impact on those who have dedicated their lives 

in caring for others such as physicians and other health care professionals, and society at large. 

41

There needs to be some appropriate balance and all of us involved in this discussion—patients, physicians, and other health 

care providers, state officials, members of Congress, members of 

the legal profession—we need to work together and try and find 

some balance in these particular areas so that people who deserve 

compensation really are. People who don’t really aren’t. 

So I want to thank all of our witnesses for traveling here today 

to present the Committee with compelling and thoughtful testimony. Both panels have been excellent. I believe the medical liability crisis is one that has to be addressed and I believe that we have 

heard some interesting ideas on how these matters may be addressed. 

And before I close this hearing I would just say we will include 

the written testimony of the Utah Trial Lawyers Association and 

the Utah Citizens Alliance, and it will be made a part of the record. 

The hearing record will be kept open for two weeks so the members 

of the Committee may submit statements, and we will do everything we can to try to resolve these matters in a way that is fair, 

decent, honorable, and above board. 

In that regard, I want to thank every witness who has testified 

here today. Everyone has done a good job. Everyone has been important. And both sides of this issue have been explained to the degree that we can in this limited hearing. And I will just keep working on and hope that we can do justice in the end, which is what 

all of us who are honest really hope can be done. And I want to 

thank every witness for being here. Thanks so much. And with that 

we are recessed until further notice. Thank you. 

[Whereupon, at 12:30 p.m., the Committee was adjourned.] 

[Submissions for the record follow.]

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