Carlos David Castro Rojas was a healthy 27-year-old engineering student when he fell off a ladder hanging Christmas lights in 2017, breaking his leg and injuring his knee.
What was supposed to be a relatively routine surgery at a Baylor Scott & White Health hospital in Dallas ultimately ended with Rojas sustaining a severe brain injury. His mother’s lawsuit alleges he wasn’t properly cared for while under general anesthesia, and the lack of blood flow and oxygen to his brain landed him in a permanent vegetative state. He’s now unable to speak or walk and requires round-the-clock care.
Like so many medical malpractice lawsuits filed before the Covid-19 pandemic, the case filed by Rojas’ mother, who moved to Dallas to care for her son, was held up as court dockets ground to a halt and jury trials were postponed. Recently, though, a jury issued a $21 million judgment against the clinicians who provided Rojas’ care, as well as their employer, U.S. Anesthesia Partners. Baylor Scott & White settled separately ahead of the trial.
The delay put “incredible pressure” on Rojas’ family, said Bruce Steckler, the attorney representing Rojas’ mother.
“It’s unfortunate that these folks had to wait,” Steckler said, “but it’s really unfortunate that they had to go through what they went through. My belief is it happened because people were putting profits ahead of their patients and not providing the quality of care they needed to provide.”
Now that courts have resumed normal operations after the pandemic-related delays of 2020 and 2021, many health systems are shouldering higher medical malpractice expenses than they otherwise might expect. The payouts, while a lifeline for the patients and families harmed by medical errors, have added significant strain onto what’s already a challenging time for hospitals facing ballooning labor and supply expenses.
“It’s a big thing,” said Ed McGrath, managing director with the consultancy VMG Health. “When you’re getting hit on labor and you’re getting hit on supply costs and then you start getting hit on medical malpractice, that’s a triple whammy.”
Throughout much of the pandemic, jury trials weren’t happening or were very limited, said Kathleen Nastri, a medical malpractice attorney with the firm Koskoff. When trials resumed, criminal cases took precedence. That meant civil cases, which include malpractice, remained dormant, she said.
“We were out for so long,” Nastri said. “The civil docket was essentially shut down.”
Typically, health systems are able to plan ahead for any legal costs they might incur and build that into their insurance reserves, but a recent report from VMG Health said some are seeing malpractice costs rise to levels they didn’t anticipate. The authors interviewed executives from 21 not-for-profit health systems, more than half of whom said they’re struggling with higher than expected malpractice costs.
So far, the higher expenses are being felt primarily at health systems that self-insure for malpractice liability, meaning they cover the cost of claims, often through offshore captive insurance companies, McGrath said. They’ll also typically have some form of catastrophic coverage for payouts that exceed certain thresholds. McGrath thinks the effects will extend to all health systems next year, even among those that do buy liability insurance.
“I think 2023 will still be a pretty tough year when it comes to this particular topic,” he said.
Major health systems like Baylor Scott & White Health, CommonSpirit Health, UPMC, Mass General Brigham, and Cleveland Clinic all reported larger self-insurance reserves or professional and general liability funds, which include malpractice, in their latest financial statements.
St. Louis-based Ascension’s professional and general liability loss reserve grew more than 6% year-over-year in fiscal 2022, reaching $932 million as of June 30, 2022.
Ascension could be on the hook for billions in legal fees after a judge determined last month that the jury can award punitive damages once a consolidated lawsuit against Ascension St. Vincent in Florida goes to trial next year. Hundreds of people have sued the hospital over injuries they say were caused by an impaired surgeon who should not have been practicing. Ascension did not respond to a request for comment.
Cleveland Clinic’s insurance expenses grew 66% in the quarter ended Sept. 30 year-over-year. A spokesperson said that reflects higher malpractice premiums, but also cybersecurity, property, and auto premiums.
“The judgments are all coming through now at much higher rates than they had been for the last two years,” said Mike Ramsay, CEO of the patient safety advocacy group Patient Safety Movement Foundation. “Unfortunately for the hospitals, a number of the judgments are against the hospitals and so they have to find the cash to pay on the suits.”
While many delayed cases were filed before the pandemic, there’s reason to believe more will result from the staff shortages and reassignments that took place during the crisis, Ramsay said. To quickly attend to the crush of Covid-19 patients, hospitals placed clinicians in intensive care units without the proper training, he said.
The effects are already showing up in hospital safety scores. Compared with pre-pandemic 2019, central-line associated bloodstream infections were up 45% in the first half of 2021. Rates of the superbug MRSA were up 39% in that time.
Nastri, the Koskoff attorney, said her current slate of cases leads her to believe hospitals have become less safe than they were before the pandemic. It could be because protocols designed to prevent sepsis or infections aren’t being followed as closely. Poorly trained staff or contract workers who aren’t familiar with a particular hospital’s protocols could also be contributing.
“I can tell you in general I have not seen as many clear errors in my 30 years of practice as I have probably in the last 18 months,” Nastri said.