In a post last year I dicussed briefly the early offer system in New Hampshire see The Optional Alternative to Medical Injury Claims. This is the first of the kind system in the United States that is an alternative to the traditional medical malpractice system. An article in the 2013 issue 4 of the American Journal of Law and Medicine has explored this titled “Evaluating New Hampshire’s First-In-The-Nation Early Offer Alternative to Medical Malpractice Litigation,” and written by John W. Masland. The article states
“Many states have enacted medical malpractice reforms, recognizing that their tort systems result in protracted litigation, high costs, and a large number of uncompensated victims. One proposed reform, an “early offer” system, allows a medical provider to make a financial offer covering an injured patient’s economic damages, which, if the patient accepts, precludes litigation…On June 27, 2012, the New Hampshire General Assembly overrode former Governor John Lynch’s veto and established the country’s first early offer payment system for medical malpractice claimants. After a medical injury, patients may now request an early offer payment from their medical providers for economic damages.”
The article goes into more specific details of the early offer program as implemented in New Hampshire. One item to note is that if a patient rejects an offer and wants to proceed with legal remedies than they may have to pay their doctor’s attorney fees and costs if the economic damages awarded are less than 125% of the offer.
In the article the author presents problems with the current medical injury system and then presents solutions. For example, he points out that the majority of injured patients never file claims. In addition he cites a study in New York which says fewer than 2% of negligently injured patients filed claims. (Note this is consistent with what is presented on the U.S. legal system and medical malpractice page over at http://www.teethremoval.com/legal_system_medical_malpractice). Further he makes the point that proving causation or the breach of the standard of care is difficult. He further states
“…according to experts, negligently injured patients who file claims are only compensated between thirty-two and eighty-nine percent of what they should receive. The current medical malpractice system fails to fairly compensate injured persons because many victims do not file claims, and those who do are undercompensated.”
Later the article goes into the origins of the early offer system and it’s suggested benefits. It is suggested that an early offer system can save insurers and doctors money while also allowing patients to have their money sooner. However, the early offer system may also cause more claims. Thus an empirical study is suggested.
Later on the author suggests that New Hampshire’s early offer system may face constitutional challenges as a violation of the rights to equal protection, due process, or the determination of damages by a jury. He goes into his reasons for this but does say the early offer system likely passes constitutional muster.
The author then goes into problems with the implementation of the New Hampshire’s early offer law. He states
“The New Hampshire law provides insufficient time for an unrepresented injured patient to consult with the neutral advisor (only five days to decide whether to proceed under the early offer process after first meeting with the advisor)…. While the early offer law does not explicitly permit a hospital to ask patients to agree to participate in the early offer system before receiving care, legislatures should consider explicitly prohibiting hospitals from asking patients to sign an early offer waiver before receiving care…. Building some flexibility into compensation systems by, for example, expanding permissible damages to include lost earning capacity will better individualize recovery and allow more claimants to participate in an early offer system….Additionally, legislatures would do well to reconsider inequitable loser-pays provisions.”
The author covers a lot of ground in the article on the early offer system in New Hampshire. For all the details I encourage you to read the article. I agree with the author’s assessment with the early offer system in New Hampshire. Particularly, I agree that flexibility into compensations systems to include lost earning capacity should be considered. As I pointed out in my earlier blog post, those who are still in school such as college, are particularly not well suited for this law. This approach seems to assume that the person who received the medical care is working and hence has lost wages that can be paid. Even though college age students are studying and haven’t started working in their career yet.
The author ends the article by saying
“A fair early offer system must be voluntary, provide sufficient time for an unrepresented claimant to decide whether to pursue an early offer, and limit the chilling effect that the bond and loser-pays provisions have on a patient’s decision to challenge an unfair offer.”