Apology and Disclosure Programs: Should they Play a Role in Obstetrical Practice?

Mar 28, 2013

A physician and a malpractice attorney discuss the merits of ‘Apology and Disclosure’ programs and their role in obstetrical practice. Do they cut costs or create trouble?

John O’Grady, MD:  A number of us were recently discussing complications of pregnancy and surgery.  The issue of “apology and disclosure” for bad results was raised.  This led to a spirited discussion and a good deal of disagreement. I and several others thought that the idea of  offering an apology for a bad result along with a disclosure of what went wrong –when this can be discerned --, combined with a  financial reimbursement of a patient’s unanticipated  hospital costs was a good idea. Further, in some instances additional payments might be reasonable in consideration of the severity of injury. However, other of our colleagues were strongly in disagreement, believing that doing this was a serious mistake. They strongly argued that a system of “Apology and Disclosure” would result higher risk of creating lawsuits and payments in situations where legal action was not even going to be contemplated, let alone pursued.  Thus, you would simply be creating issues and increasing costs to the system. Furthermore, you would be asking physicians to take on roles that they haven’t been trained to perform and may not be adept at ameliorating patient dissatisfaction. 

These physicians thought this idea to be simply unworkable. Those with private insurance argued that they had no ability to commit an insurance company to any payment scheme. They also opined that the mere act of apology might place in jeopardy their insurance coverage. That is, the apology would be an admission of “guilt” that would later be used against them by the patient and so the malpractice insurer would claim that they violated the contract by not cooperating with the defense. So, if the process/offer was not previously approved by the insurance carrier it could possibly result in a denial of coverage.
So, who is correct? As an aside, I note that a number of institutions have established such systems for expressing regret and /or apology. Those organizing these schemes obviously believe that this can have a beneficial effect, short circuiting potential suits, improving relationships with unhappy patients and improving care by identifying problems with health care delivery sooner. So certainly somebody thinks it’s a good idea.
Kevin Giordano, Esq.: Apology and Disclosure programs do have their place in resolving conflicts that develop within the patient / health care provider relationship. But, you have to have clear goals in mind. I believe that there is a misconception about the promises of such programs. If they work as suggested, such programs should identify potential cases of liability early on followed by reaching out to the patient and/or their family.  In so doing, patients are compensated sooner, are less hostile and vested in an adversarial relationship, so cases are resolved sooner and for less money in indemnity dollars and litigation costs. So arguably one would see a savings of the institutional resources.   Although there is some evidence to suggest that such a program, if implemented carefully and thoughtfully, will not increase costs to a self-insured health care institution, I am not convinced yet that there is sufficient evidence-based data to support that such a program will save money.
Thus, for me, Apology and Disclosure programs should strive to change the culture within any institution that does not effectively acknowledge errors to one in which transparency is created in an effort to improve health systems and delivery of care.  Then, arising out of that culture, a concomitant effort to redress a patient and perhaps the needs of their family as soon as practicable if an injury was caused by a failure to meet applicable standards.

O’Grady: I don’t understand, as I have always seen discussion of Apology and Disclosure in the context of saving overall costs. If health care providers identify cases right away where there has been malpractice, and then disclose that to the family with an apology, what is the downside? More importantly doesn’t that kind of bedside manner often dissuade patients from bring lawsuits and thereby avoiding litigation altogether? Even if we have to come armed with cash, aren’t both indemnity payments and attorney’s fees going to be much less if all this is done before the parties are lawyered-up?  Not for nothing, but you do have a horse in this race, no?

: Ok, let me try and explain what I’m saying.  First though, it’s important to understand that since we are only discussing the merits of Apology and Disclosure, at least at least at this point, we need to limit the conversation to the concept rather than the implementation.  Whether any individual physician or practice should attempt to do this unilaterally is a complex question that we can take on next time.  So for our consideration of Apology and Disclosure as a concept, let’s put place it in the setting of a self-insured institution, as many are these days.  This helps us simplify the approach with a limited number of variables as often institutions are responsible for both the care that was provided as well as the litigations costs and indemnity dollars.                
I do agree that Apology and Disclosure programs have an important place-as part of an overall effort to implement a culture of safety that identifies adverse outcomes as well as a tool to resolve conflict and to reduce patient distress-including financial compensation if a cash settlement of a patient injury is appropriate.  I would go a step further and suggest that the health institution have an ethical obligation to initiate policies that create transparency and promote disclosing the reason(s) for a bad outcome, as best these are known.  As seen in the airline industry, when the approach to safety is a major goal and a program is implemented to identify potential safety errors with careful analysis of both “near misses”  and problem outcomes, and the lessons incorporated into the systems then the number of  “bad events” related to human error decreases.  Apology and Disclosure policies contribute to that culture and thus hopefully lead to a heightened awareness and identification of unsafe practices. Does this result in cost savings? Certainly, by reducing bad outcomes, you can hopefully reduce future indemnity dollars. To the extent that a policy of transparency with an apology reduces actual indemnity dollars for each respective case because the resolution occurs in a setting of goodwill as opposed to an adversarial process, or the legal costs to the system are reduced by avoiding protracted litigation, then obviously that is a tremendous benefit. But I simply do not believe the evidence at this point allows us to draw a cause and effect conclusion between the implementation of these programs and costs savings. 
So, why do I say that? Remember, in many instances the decision whether to reach out to the patient in some manner will be easier than the decision about whether compensation is in order. Some of these issues will be rather complex. In the end, I would argue that an expression of empathy will be offered in many cases of a bad outcome, but compensation only in selected circumstances.  Obstetrical cases are a significant cost to any insurer. Now, if the costs to the health care system in defending these cases primarily arise where the bad outcome was caused by malpractice, then significant cost reductions may be possible. It would of course depend upon being able to settle the case through an amicable resolution early on for less money that the combination of the settlement value and legal expense if settled during adversarial litigation. Yet, as is my experience, if the majority of obstetric cases that end up as lawsuits are either defensible because the standard of care was followed, or at the very least, liability is not clear cut, then many cases will fall outside the boundaries of compensation programs. Patients may accept the explanation and not pursue anything further.  However conversely, many will still proceed with filing a lawsuit. Also, we have to factor in that many cases that occur in both obstetrical and non-obstetrical litigation arise when the discovery of injury is made months if not years after the alleged injury.  Thus, in my mind, the potential for cost reduction is likely to be more limited than the designers initially anticipated. 
To me, the good news is that data to date tends to support that Apology and Disclosure programs that are implemented thoughtfully do not add additional costs to the institution. Those institutions that have initiated a full transparency program, in a thoughtful way, are not creating more lawsuits and more indemnity dollars by doing so. If further studies bear this out, or in fact establish that costs can be reduced, this strengthens the argument for implementing such programs.

O’Grady: In my opinion a lot of the distrust and skepticism exists because of the Deny and Defend philosophy that has existed for so long, especially in reference to obstetric complications.  It is a lot to ask of providers to now embrace a new philosophy of Apology and Disclosure. This is especially true when the clinical circumstances surrounding many complications are not clear cut and the process of ascertaining “responsibility” is complex, the standard of care is fuzzy, or best practice is not fixed. I imagine that many physicians need more insight into how these Apology and Disclosure schemes work before they fully embrace the concept. But on top of that, if this is the future, a lot of us--and not just me alone--are going to need Charm School!
Giordano: We do need to talk about this in more detail.  Perhaps we can explore this further in our next article. Don’t worry; there is always room for you in Charm School!