Birth injury funds may end lawsuit strife for ob.gyns.

Physicians in Maryland are pushing for legislation that would create a fund to compensate infants injured at birth, in an attempt to combat multimillion-dollar jury verdicts and excessive liability premiums for ob.gyns. in that state. If passed, Maryland would follow in the footsteps of three other states that have birth injury funds: New York, Florida, and Virginia.

"Physicians who have been sued know how devastating that can be," said Dr. Dan K. Morhaim (D-Baltimore County), a Maryland state delegate who sponsored the bill. The birth injury fund "would avoid lawsuits where the problem could be solved another way. The current system is based on litigation. It’s like a big-time lottery. Some [plaintiffs] get huge settlements, others get nothing."

The proposed Maryland bill would require physicians who deliver at least five infants yearly to pay $7,500 into the fund annually, while hospitals would pay about $175 per birth, depending on hospital size. Insurers also would pay a surcharge. Families would have to show proof of an infant’s injury when applying to the fund, and an administrative law judge would determine eligibility. The bill is currently in the Maryland House of Delegates and at press time a hearing was scheduled.

Questions remain, however, about how effective birth injury funds are for physicians and whether they work to reduce litigation costs. Medical experts in Virginia and Florida cite significant reductions in medical liability premiums for doctors and markedly lower claim frequency since enactment of their respective funds. New York physicians, however, have so far not seen the results they had hoped from the fund, said Liz Dears, senior vice president for legislative and regulatory affairs for the Medical Society of the State of New York.

In New York, physicians "have not been able to attribute any reductions in medical liability premiums to the existence of the [fund]," Ms. Dears said. "For physicians, it’s been very disappointing. It hasn’t translated into what our overall goal has been, which is overall cost reductions."

New York enacted its medial indemnity fund in 2011. The system is designed to pay future medical costs of malpractice plaintiffs who receive court-approved settlements or judgments for birth-related injuries. The medical indemnity fund is funded by assessing all hospitals performing obstetrical services an amount equal to 1.6% percent of their obstetrics revenue. Doctors do not pay into the fund, Ms. Dears said. Thus far, the 3-year-old program has resulted in lower medical liability premiums for some hospitals – but not doctors, she said.

In Virginia, ob.gyns. and other physicians report an opposite experience. The state’s birth injury fund was created in 1987 to mitigate a growing lack of insurance coverage for ob.gyns., said Michael Jurgensen, senior vice president of health policy for the Medical Society of Virginia. Participating physicians pay $5,000 a year into the fund, while nonparticipating doctors pay $250 a year. Participating hospitals also pay an assessment.

The Joint Legislative Audit and Review Commission, an oversight agency of the Virginia General Assembly, studied the impact of Virginia’s fund in 2002. The analysis found the program played a significant role in minimizing legal claims for severely birth-injured children and helped to ameliorate the lack of available insurance for ob.gyns. The program has aided in keeping medical liability premiums stable in the state, Mr. Jurgensen said.

"It takes [physicians] out of the medical malpractice climate and ensures they can continue to get adequate malpractice coverage," Mr. Jurgensen said of the fund. "It [also] provides a structured program that, in the event of a birth injury, the parents can have some assurance that the [infant] is going to be taken care of."

Florida doctors have had similar litigation relief from their fund, which was enacted in 1988. The Florida Birth-Related Neurological Injury Compensation Association (NICA) is funded similarly to the Virginia program with participating, nonparticipating doctors, hospitals, and midwives contributing annually. Like Virginia’s fund, families are accepted into the program after an evaluation by an administrative law judge. In both states, parents can decline to apply to the fund and still pursue legal action if they so choose.

The Florida fund began with about 700 participating physicians and midwives and now includes more than 1,100 practitioners, said Dr. Robert W. Yelverton, a Tampa ob.gyn. and chair of American Congress of Obstetricians and Gynecologists for Florida District XII.

"The bottom line is it’s been very successful, and doctors are very pleased with it," he said. "Overall, it improves the quality of care and keeps obstetricians in the state."

The program has resulted in lower premiums for all doctors, regardless of specialty, added Jeff Scott, Florida Medical Association director of legal and government affairs.

"It benefits every physician by removing these big-ticket verdicts or settlements from the pool," he said. "When you pay your premiums, it’s not like your premiums just go to your specialty. The insurance company operates one big pool. When hits to the pool are prevented, everyone benefits."

According to a 2006 NICA actuarial study, the fund saves all Florida physicians an estimated $1,477 in premiums per year.

States considering similar birth injury funds should expect controversy and challenges, medical experts said. In New York, the New York State Academy of Trial Lawyers continues to fight the fund legislation, operating an ongoing campaign to challenge the program. Virginia’s program came under scrutiny in early 2000 by doctors, attorneys, and state officials who were concerned about the fund’s stability. The worries prompted the Joint Legislative Audit and Review Commission’s 2002 review and led to some assessment restructuring. Florida fund advocates, meanwhile, have faced several constitutional challenges, including a recent dispute that ended with a Florida Supreme Court victory for the fund in May 2013.

"It can be complex program to run," Mr. Jurgensen said. "You’re putting patients in the program for fundamentally a lifetime, and you don’t know how long that lifetime is going to be. It’s a daunting challenge to consider. A lot of states don’t want to take this up because of that complexity."

Physicians in Maryland are pushing for legislation that would create a fund to compensate infants injured at birth, in an attempt to combat multimillion-dollar jury verdicts and excessive liability premiums for ob.gyns. in that state. If passed, Maryland would follow in the footsteps of three other states that have birth injury funds: New York, Florida, and Virginia.

"Physicians who have been sued know how devastating that can be," said Dr. Dan K. Morhaim (D-Baltimore County), a Maryland state delegate who sponsored the bill. The birth injury fund "would avoid lawsuits where the problem could be solved another way. The current system is based on litigation. It’s like a big-time lottery. Some [plaintiffs] get huge settlements, others get nothing."

The proposed Maryland bill would require physicians who deliver at least five infants yearly to pay $7,500 into the fund annually, while hospitals would pay about $175 per birth, depending on hospital size. Insurers also would pay a surcharge. Families would have to show proof of an infant’s injury when applying to the fund, and an administrative law judge would determine eligibility. The bill is currently in the Maryland House of Delegates and at press time a hearing was scheduled.

Questions remain, however, about how effective birth injury funds are for physicians and whether they work to reduce litigation costs. Medical experts in Virginia and Florida cite significant reductions in medical liability premiums for doctors and markedly lower claim frequency since enactment of their respective funds. New York physicians, however, have so far not seen the results they had hoped from the fund, said Liz Dears, senior vice president for legislative and regulatory affairs for the Medical Society of the State of New York.

In New York, physicians "have not been able to attribute any reductions in medical liability premiums to the existence of the [fund]," Ms. Dears said. "For physicians, it’s been very disappointing. It hasn’t translated into what our overall goal has been, which is overall cost reductions."

New York enacted its medial indemnity fund in 2011. The system is designed to pay future medical costs of malpractice plaintiffs who receive court-approved settlements or judgments for birth-related injuries. The medical indemnity fund is funded by assessing all hospitals performing obstetrical services an amount equal to 1.6% percent of their obstetrics revenue. Doctors do not pay into the fund, Ms. Dears said. Thus far, the 3-year-old program has resulted in lower medical liability premiums for some hospitals – but not doctors, she said.

In Virginia, ob.gyns. and other physicians report an opposite experience. The state’s birth injury fund was created in 1987 to mitigate a growing lack of insurance coverage for ob.gyns., said Michael Jurgensen, senior vice president of health policy for the Medical Society of Virginia. Participating physicians pay $5,000 a year into the fund, while nonparticipating doctors pay $250 a year. Participating hospitals also pay an assessment.

The Joint Legislative Audit and Review Commission, an oversight agency of the Virginia General Assembly, studied the impact of Virginia’s fund in 2002. The analysis found the program played a significant role in minimizing legal claims for severely birth-injured children and helped to ameliorate the lack of available insurance for ob.gyns. The program has aided in keeping medical liability premiums stable in the state, Mr. Jurgensen said.

"It takes [physicians] out of the medical malpractice climate and ensures they can continue to get adequate malpractice coverage," Mr. Jurgensen said of the fund. "It [also] provides a structured program that, in the event of a birth injury, the parents can have some assurance that the [infant] is going to be taken care of."

Florida doctors have had similar litigation relief from their fund, which was enacted in 1988. The Florida Birth-Related Neurological Injury Compensation Association (NICA) is funded similarly to the Virginia program with participating, nonparticipating doctors, hospitals, and midwives contributing annually. Like Virginia’s fund, families are accepted into the program after an evaluation by an administrative law judge. In both states, parents can decline to apply to the fund and still pursue legal action if they so choose.

The Florida fund began with about 700 participating physicians and midwives and now includes more than 1,100 practitioners, said Dr. Robert W. Yelverton, a Tampa ob.gyn. and chair of American Congress of Obstetricians and Gynecologists for Florida District XII.

"The bottom line is it’s been very successful, and doctors are very pleased with it," he said. "Overall, it improves the quality of care and keeps obstetricians in the state."

The program has resulted in lower premiums for all doctors, regardless of specialty, added Jeff Scott, Florida Medical Association director of legal and government affairs.

"It benefits every physician by removing these big-ticket verdicts or settlements from the pool," he said. "When you pay your premiums, it’s not like your premiums just go to your specialty. The insurance company operates one big pool. When hits to the pool are prevented, everyone benefits."

According to a 2006 NICA actuarial study, the fund saves all Florida physicians an estimated $1,477 in premiums per year.

States considering similar birth injury funds should expect controversy and challenges, medical experts said. In New York, the New York State Academy of Trial Lawyers continues to fight the fund legislation, operating an ongoing campaign to challenge the program. Virginia’s program came under scrutiny in early 2000 by doctors, attorneys, and state officials who were concerned about the fund’s stability. The worries prompted the Joint Legislative Audit and Review Commission’s 2002 review and led to some assessment restructuring. Florida fund advocates, meanwhile, have faced several constitutional challenges, including a recent dispute that ended with a Florida Supreme Court victory for the fund in May 2013.

"It can be complex program to run," Mr. Jurgensen said. "You’re putting patients in the program for fundamentally a lifetime, and you don’t know how long that lifetime is going to be. It’s a daunting challenge to consider. A lot of states don’t want to take this up because of that complexity."

Physicians in Maryland are pushing for legislation that would create a fund to compensate infants injured at birth, in an attempt to combat multimillion-dollar jury verdicts and excessive liability premiums for ob.gyns. in that state. If passed, Maryland would follow in the footsteps of three other states that have birth injury funds: New York, Florida, and Virginia.

"Physicians who have been sued know how devastating that can be," said Dr. Dan K. Morhaim (D-Baltimore County), a Maryland state delegate who sponsored the bill. The birth injury fund "would avoid lawsuits where the problem could be solved another way. The current system is based on litigation. It’s like a big-time lottery. Some [plaintiffs] get huge settlements, others get nothing."

The proposed Maryland bill would require physicians who deliver at least five infants yearly to pay $7,500 into the fund annually, while hospitals would pay about $175 per birth, depending on hospital size. Insurers also would pay a surcharge. Families would have to show proof of an infant’s injury when applying to the fund, and an administrative law judge would determine eligibility. The bill is currently in the Maryland House of Delegates and at press time a hearing was scheduled.

Questions remain, however, about how effective birth injury funds are for physicians and whether they work to reduce litigation costs. Medical experts in Virginia and Florida cite significant reductions in medical liability premiums for doctors and markedly lower claim frequency since enactment of their respective funds. New York physicians, however, have so far not seen the results they had hoped from the fund, said Liz Dears, senior vice president for legislative and regulatory affairs for the Medical Society of the State of New York.

In New York, physicians "have not been able to attribute any reductions in medical liability premiums to the existence of the [fund]," Ms. Dears said. "For physicians, it’s been very disappointing. It hasn’t translated into what our overall goal has been, which is overall cost reductions."

New York enacted its medial indemnity fund in 2011. The system is designed to pay future medical costs of malpractice plaintiffs who receive court-approved settlements or judgments for birth-related injuries. The medical indemnity fund is funded by assessing all hospitals performing obstetrical services an amount equal to 1.6% percent of their obstetrics revenue. Doctors do not pay into the fund, Ms. Dears said. Thus far, the 3-year-old program has resulted in lower medical liability premiums for some hospitals – but not doctors, she said.

In Virginia, ob.gyns. and other physicians report an opposite experience. The state’s birth injury fund was created in 1987 to mitigate a growing lack of insurance coverage for ob.gyns., said Michael Jurgensen, senior vice president of health policy for the Medical Society of Virginia. Participating physicians pay $5,000 a year into the fund, while nonparticipating doctors pay $250 a year. Participating hospitals also pay an assessment.

The Joint Legislative Audit and Review Commission, an oversight agency of the Virginia General Assembly, studied the impact of Virginia’s fund in 2002. The analysis found the program played a significant role in minimizing legal claims for severely birth-injured children and helped to ameliorate the lack of available insurance for ob.gyns. The program has aided in keeping medical liability premiums stable in the state, Mr. Jurgensen said.

"It takes [physicians] out of the medical malpractice climate and ensures they can continue to get adequate malpractice coverage," Mr. Jurgensen said of the fund. "It [also] provides a structured program that, in the event of a birth injury, the parents can have some assurance that the [infant] is going to be taken care of."

Florida doctors have had similar litigation relief from their fund, which was enacted in 1988. The Florida Birth-Related Neurological Injury Compensation Association (NICA) is funded similarly to the Virginia program with participating, nonparticipating doctors, hospitals, and midwives contributing annually. Like Virginia’s fund, families are accepted into the program after an evaluation by an administrative law judge. In both states, parents can decline to apply to the fund and still pursue legal action if they so choose.

The Florida fund began with about 700 participating physicians and midwives and now includes more than 1,100 practitioners, said Dr. Robert W. Yelverton, a Tampa ob.gyn. and chair of American Congress of Obstetricians and Gynecologists for Florida District XII.

"The bottom line is it’s been very successful, and doctors are very pleased with it," he said. "Overall, it improves the quality of care and keeps obstetricians in the state."

The program has resulted in lower premiums for all doctors, regardless of specialty, added Jeff Scott, Florida Medical Association director of legal and government affairs.

"It benefits every physician by removing these big-ticket verdicts or settlements from the pool," he said. "When you pay your premiums, it’s not like your premiums just go to your specialty. The insurance company operates one big pool. When hits to the pool are prevented, everyone benefits."

According to a 2006 NICA actuarial study, the fund saves all Florida physicians an estimated $1,477 in premiums per year.

States considering similar birth injury funds should expect controversy and challenges, medical experts said. In New York, the New York State Academy of Trial Lawyers continues to fight the fund legislation, operating an ongoing campaign to challenge the program. Virginia’s program came under scrutiny in early 2000 by doctors, attorneys, and state officials who were concerned about the fund’s stability. The worries prompted the Joint Legislative Audit and Review Commission’s 2002 review and led to some assessment restructuring. Florida fund advocates, meanwhile, have faced several constitutional challenges, including a recent dispute that ended with a Florida Supreme Court victory for the fund in May 2013.

"It can be complex program to run," Mr. Jurgensen said. "You’re putting patients in the program for fundamentally a lifetime, and you don’t know how long that lifetime is going to be. It’s a daunting challenge to consider. A lot of states don’t want to take this up because of that complexity."