Marcus Rayner • Executive Director, NJLRA

Medicine bears the distinction of being both business and personal.  Too many promising medical students are becoming a casualty of our litigious health-care system.  In turn, it limits the number of specialized medical doctors

I want to thank the Women’s Legislative Caucus and its co-chairs for the opportunity to testify here today.  As you may know, the New Jersey Lawsuit Reform Alliance (NJLRA) was created in 2007 out of a broad concern among business leaders and professionals in the medical community about the state of New Jersey’s civil justice system.  I am very pleased that the Caucus has convened this hearing to look at the various ways that access to care is limited in certain health care services for women in New Jersey.

As the national debate on health-care reform and tort reform unfolds, it is worth noting that here in New Jersey, we have our own health- care crisis under way. And it is driving out physicians, limiting patient access to care and increasing the cost of health care for all of us.

For many existing and aspiring medical students in New Jersey, the dream of practicing specialized medicine faces a significant hurdle: malpractice insurance premiums.  Too many promising medical students are becoming a casualty of our litigious health-care system.  This, in turn, limits the number of specialized medical doctors such as OG/GYNs in our state and eliminates access to care for thousands of New Jersey women. 

At some point in their education, medical students realize that in order to have a solvent future as an OB/GYN, they will have to deliver scores of newborns each quarter just to afford the cost of the high malpractice premium. Rates have skyrocketed for doctors practicing specialized medicine during the last few years. In order to simply maintain a viable practice, many doctors will likely have to see more patients and deliver more babies than any doctor reasonably could without compromising quality of care for patients.

Conversely, many will opt to not treat various patients, such as emergency room or acute care patients, because of the liability that doing so presents.  These decisions are the direct result of the high medical malpractice premiums facing specialty doctors in New Jersey today.

Malpractice insurance costs so much because New Jersey’s current civil justice laws are decisively anti-physician. Malpractice awards in New Jersey are not capped, for one, as they are in thirty-two other states. In addition, some New Jersey courts allow cases to be built around weak “junk science” that is often not permissible in other jurisdictions. As a result, New Jersey’s courts have become a lottery for those wanting to turn an unfortunate medical outcome into a payday. Physicians, therefore, are required to prepare themselves with sufficient insurance should they find themselves — or others with whom they share a practice or support staff — to be the victim of frivolous litigation. As I mentioned, this excessive physician liability can also force many doctors to abandon specialized medicine altogether, leaving many patients without care.

While both federal and state governments bear responsibility for setting civil justice and medical malpractice policy, aspiring physicians in New Jersey are at a notable disadvantage. Medicine bears the distinction of being both business and personal. Why practice specialized medicine in New Jersey when other states, including some of our neighbors, offer much less burdensome alternatives?

In Pennsylvania, for example, punitive damages against individual physicians are limited to 200% of compensatory damages.  Many of you may be familiar with the successful medical malpractice reforms in Texas, which after capping medical malpractice awards in 2003 saw an average 21.3% annual decrease in  medical malpractice premiums in the following four years.  As a result, the number of medical license applications in Texas increased 18% in the four years since the state legislature enacted the caps. (Source, The New York Times, More Doctors in Texas After Malpractice Caps, October 5, 2007).

Mississippi experienced 25% annual increases in medical malpractice premiums prior to their reforms and even created a state insurance pool to offer coverage to doctors.  After their reforms, rates plummeted and the State of Mississippi was able to sell the state insurance pool.

According to the National Conference of State Legislatures, all but 15 states have adopted some limit on medical malpractice awards.  New Jersey must join the majority of states in adopting some reasonable limits on medical damage awards.  Without them, we will continue to force doctors out of our state and we will limit care to thousands of our most vulnerable women and children.