Dr. Goebel has his own law offices in Huntington Beach, CA,
and is the Medical Director of Oncology Services, Community
Hospital of Long Beach, CA.
Traditionally, hotly contested disputes have led the adversary
parties to the courtroom for trials. This has often resulted in
time-consuming, expensive proceedings, the outcomes of which are
frequently at odds with the purpose of the action. The analysis of
medical errors undertaken by the Harvard School of Public Health
found that the awards in medical malpractice actions by patients
injured in New York hospitals was strongly linked to the magnitude
of the disability caused by the adverse event rather than the
presence of actual negligence.
1
This tendency may lead to flawed outcomes in many cases.
Compounding the potentially flawed outcomes of many trials is
the increasing number of disputes that can be litigated. According
to Walter T. Fisher and Melvin C. Ury in
Getting to Yes
, their groundbreaking book on negotiation, "conflict is a growth
industry. Everyone wants to participate in decisions affecting
them; fewer and fewer people will accept the decisions dictated by
someone else."
2
According to the American Arbitration Association, 90% of the
people in the United States would prefer to settle disputes without
going to court.
3
Because of this preference, the techniques of negotiation,
arbitration, and mediation have gained favor in providing
alternative means of resolving disputes; hence the term,
"alternative dispute resolution" (ADR).
The judiciary has embraced ADR. The
California Practice Guide on Civil Procedure before Trial
advises attorneys, "before jumping into a lawsuit, consider whether
the case lends itself to arbitration or other out-of-court
procedures to resolve the dispute."
4
Types of ADR
There are various ADR procedures to consider,
3-6
including negotiation, binding (contractual) arbitration, and
judicial arbitration.
*
Negotiation--
Negotiation involves direct settlement negotiations with the
opposing party.
* Mediation--
Mediation is the process of settlement negotiations between counsel
(for the opposing parties) when it is aided by informal evaluation
of the case by a retired judge or another experienced person or a
panel. Mediation is sometimes called "nonbinding arbitration."
* Binding (contractual) arbitration--
By agreement before or after a dispute arises, parties may agree to
accept and be bound by an arbitrator's award. Arbitration pursuant
to such agreements is known as contractual arbitration.
* Judicial arbitration--
There are some litigated cases where, despite the lack of agreement
to arbitrate, by order of the court they must go to arbitration
prior to the trial date assigned. In these cases, the arbitrator's
award is not binding and either side may demand that the trial take
place.
Relevance of ADR to the radiologist and the radiation
oncologist
The radiologist and the radiation oncologist interact with many
persons and entities with whom disputes might arise. It behooves
them to be aware that ADR can affect them in two significant
scenarios. The physician involved in a dispute might want to choose
to participate in one the forms of ADR as a strategic decision to
gain a better position in order to avoid costly litigation or due
to unequal bargaining power.
Or, the physician may be confronted with a pre-existing duty to
use ADR (usually binding arbitration). This often arises in
contractual disputes in which there is a binding arbitration
provision. This may be an unpleasant surprise if he or she (or the
attorney) has not carefully read the contract.
Like it or not, your existence as a radiologist is probably
already inexorably intertwined with ADR!
Which form of dispute resolution is best for
you?
Although there is no single answer, considerable progress has
been made recently in developing methods for selecting which type
of dispute resolution to use in various situations.
In
Renegotiating Health Care
, Marcus and Dorn
5
give the following general principles that motivate parties to
agree to choose one method of dispute resolution over another.
"Disputants choose arbitration over litigation when they want to
settle their disputes without the complications of a courtroom
battle. They confer to the arbitrator control of both process and
outcome." On the other hand, disputants choose mediation when they
want the mediator to control the process but not necessarily the
outcome. Finally, parties will choose negotiation when they want to
control both process and outcome.
Unfortunately, many cases arise in which there is no binding
arbitration clause and in which there is no agreement between the
parties to use ADR as opposed to litigation or taking no action at
all (stonewalling). Liang
7
has developed a model of assessing when ADR is economically
efficient in comparison to no action or formal adjudication. This
model can be useful in several hypothetical non-malpractice
situations familiar to radiologists.
In the first hypothetical situation, he analyzed a dispute
between two recently merged hospitals concerning which one would
get to have the sole MRI scanner that would be purchased for both
facilities. In that case, mediation was found to be the best fit
because it allowed for a creative resolution of the issue while
improving communication between the parties.
On the other hand, in the hypothetical case of an older
radiologist who felt that his reputation suffered after his
exclusive contract had not been renewed, the analysis suggested
that a combination of mediation and arbitration would be optimal.
In this hybrid form of ADR, if mediation fails, then an advisory
opinion could give the radiologist and the hospital an objective
assessment regarding the conflict should the matter proceed to
formal adjudication. Such an opinion could also help the
physician's reputational concerns by formally stating that his
competence was not an issue in not renewing his contract.
7
Medical malpractice cases
The previous hypothetical cases involve potential contractual
disputes. Medical malpractice, on the other hand, involves the
alleged negligence of the radiologist. Frequent claims against
radiologists include failure to diagnose cancer and complications
of procedures.
Many hospitals, such as Duke Medical Center, have adopted
medical malpractice ADR programs.
6
In these programs, execution of the ADR agreement by the patient is
voluntary, and failure of the patient to execute the agreement has
no effect on the availability or delivery of services to the
patient. As of 1997, 17 states have statutes that address
arbitration of medical malpractice claims.
8
California has adopted formal recommendations for implementation of
Malpractice ADR Guidelines in California Code of Civil Procedure
Section 1295.
9
Inclusion of specific language waiving a jury trial prevents these
agreements from being disregarded as adhesion ("take-it-or-
leave-it") contracts.
10
Usually, the specific ADR procedures adopted are indicated
clearly in the arbitration agreement, and a copy of the specific
ADR procedures adopted is made available to the patient. An example
of specific ADR procedures is the Health Care Claim Settlement
Procedures of the American Arbitration Association.
3
The implementation of a medical malpractice ADR program by a
radiologist's hospital can substantially impact the process and
outcome of medical malpractice suits against him or her. ADR is
becoming used increasingly in imaging cases involving the
misdiagnosis of cancer.
A recent review, conducted on LEXIS and WESTLAW, evaluated how
often ADR influenced the outcome in 105 breast cancer malpractice
lawsuits. Of the 58 cases in which plaintiffs were compensated, 37
were resolved using ADR rather than trial verdicts. These
plaintiffs' compensations totaled $9,381,483. Of the 6 suits
against HMOs, 5 were resolved by ADR.
11
ADR was used in 28 of the 39 cases in which a palpable breast
mass was not biopsied, including 19 of the 25 cases in which the
plaintiff discovered the mass herself and 5 of the 8 cases in which
the woman was younger than 40 years old. It was also used in 3 of
the 4 cases involving screening mammography and in 10 of the 11
cases in which mammography did not lead to the diagnosis, including
all 4 cases of misreading and 4 of the 5 cases in which mammogram
reports were not delivered promptly.
Plaintiffs' disabilities from the alleged negligence in these
cases was scored using Medical Error Analysis
1
as applied to breast cancer. The plaintiffs' temporary or permament
disabilities were evaluated and given a score from 1 to 8. The
disability scores were grouped descriptively as a function of
plaintiff compensation for evaluable cases in the trial and ADR
groups. The distribution of compensation as a function of
disability score was similar in both groups.
11
It is in a radiologist's self-interest to have an ADR program
established in the hospital's medical malpractice system if one is
not in place, or to fully understand the hospital's medical
malpractice ADR program if one already exists
Caveat: You can be surprised by existing ADR
agreements
Contracts function as private law between the contracting
parties. They are usually enforceable in court barring improper
formation, an acceptable defense, or breach by the opposing party.
ADR clauses in contracts signed by radiologists with hospitals,
HMOs, and other parties are part of the contract. Once signed,
contracts are often not able to be changed unless both parties
agree in writing. Often, the only way out of a contract may be
cancellation by the radiologist. This option, if available, may
require giving several months' notice during which services must
continue to be rendered to avoid allegations of breach of contract
and possible allegations of patient abandonment.
12
This happened in the case of a large medical group in Southern
California that went bankrupt recently; the group had over 500,000
patients capitated to them from health plans. These patients were,
in turn, contracted to specialists, including radiologists and
radiation oncologists using a "boiler-plate" contract containing a
mandatory ADR clause and a 90-day notice requirement for
cancellation without cause. When the medical group stopped paying
many of the specialists, they found that they "de facto" had no
recourse to obtain their payments; and many worked "for free" until
the medical group declared bankruptcy.
13
Another recent case involved the recoupments by Blue Cross of
California of approximately $30,000 for radiation management
services by a Southern California radiology group. According to the
California Radiological Society (CRS), "the vast majority of
radiation oncology groups bill for weekly treatment management by
using a '5' in the unit box on the claim, indicating 5 fractions of
treatment." Blue Cross maintained that they had been reimbursing
each CPT code 77430 thus billed for 5 weeks of treatment instead of
5 days of treatment--and they wanted a refund! The case was
submitted to arbitration and the arbitrator found in favor of Blue
Cross, much to the chagrin of the CRS, who had expended in the
aggregate approximately $50,000 in legal fees.
14
ADR also is potentially susceptible to accusations of bias.
15
To avoid this taint, which in the past has resulted in arbitration
having to be repeated, it is necessary to avoid the appearance of
financial interest by the arbitrator--for example, by being
repeatedly retained by one of the parties. In one such case, the
arbitrator's prior experience working on behalf of the hospital
created an impression of possible bias.
16
On the other hand, some patients may be unpleasantly surprised
to find that they are bound by arbitration agreements that they did
not themselves actually sign if they were represented by an
individual acting on their behalf (such as an employer for an
employee, a parent for a child, or a spouse for a partner).
17-19
So the potential risks and benefits of ADR are shared by all
parties.
The formalities of a contractual arbitration program cannot be
allowed to delay or impede the expeditious processing of claims. If
they are, the plaintiff might be able to wrest the case from a
normally mandatory contractual arbitration process and instead
litigate it in court. Such was the case in
Engalla v. Permanente Medical Group
, a radiology malpractice case in which a lung cancer was missed on
an x-ray examination, resulting in the patient's tumor becoming
more advanced--and inoperable--at the time of the diagnosis. The
plaintiff sought arbitration under the self-administered Kaiser
contractual arbitration plan, which promised in its consumer
booklet that all three arbitrators would be in place within 60
days. Unfortunately, nothing was done for 144 days, at which time
Engalla died. There were frequent and possibly deliberate delays,
prompting the California Court of Appeals to conclude that there
was actionable fraud.
8,20
Conclusion
Alternative dispute resolution has become an integral part of
radiology and radiation oncology. It offers the potential to
protect radiologists from unfair, expensive, and protracted
litigation. But it also carries its own potential risks in
uncertainty of outcome, loss of autonomy, and the possibility of
being bound by unwanted ADR provisions in contracts. The best way
to make ADR work for a radiologist or radiation oncologist is to be
aware of the possibility of disputes and vigilant for circumstances
in which the need for ADR may spring up unexpectedly.
AR