Report Suggest COVID Delays Causing Increased Expense to Hospitals
Report Suggest COVID Delays Causing Increased Expense to Hospitals
Chicago
December 28 2022
By John Senese
A recent report from VMG Health, a healthcare strategy and transaction company, suggests that a delay in progressing medical malpractice cases during the pandemic is leading to an increase in medical malpractice activity and is increasing the costs of medical malpractice cases to the hospital in 2022.
According to the Illinois Circuit Court website, the number of pending cases in the State of Illinois’ Law Division (greater than $50,000) rose through Q3 of 2021. Illinois had approximately 34,655 cases pending in the Law Division at the end of the third quarter of 2021, compared to 29,737 in 2019 during the same period, a 16% increase. The difference in growth between pending cases in the Law Division in 2019 versus 2018 was less than 2% year over year. (29,330 pending in 2018 Q3). The increase is expected, given that State Courts shut down jury trials for approximately a year, leaving cases in limbo.
When the COVID pandemic caused both State and Nationwide closures, it slowed down the advancement of Court cases. That stoppage affected the progress of Law Division trials, where most Medical Malpractice claims are processed. Although the Cook County Court continued operating, it ceased civil jury trials set in March 2020. It was not until September 9, 2021, that GAO 21-2 allowed the resumption of jury trials to include all sections of the Law Division.
In the Cook County Law division, some Courts are expecting category two cases greater than $50,000 to be ready for trial certification twenty-six months after the Plaintiff files their initial complaint. To help ensure cases are meeting the twenty-six-month trial certification goal, a twelve-month interim case management date is used to make sure cases are meeting discovery deadlines.
The natural inquiry is, at what point does the backlog in pre-pandemic medical malpractice cases and newly filed medical malpractice cases converge and presumably increase the cost for hospitals above pre-pandemic levels?
The expected outcome is increased costs to hospitals in defending more cases and paying out more claims than a pre-pandemic average. However, as of September 2022, yearend payout statistics on medical malpractice claims is not expected to reach pre-pandemic levels, although is on pace to surpass 2021 based on the Department of Health and Human Services data tool that provides information on Medical Malpractice Payment Reporting. Presumably, by the yearend of 2023 or 2024, we will see above-average payouts and above pre-pandemic levels as pre-pandemic cases and newly filed cases get closer to the end stages of litigation.
Court scheduling is not the only factor in the anticipated to increase in medical malpractice defense. The “great resignation” has affected staffing levels at hospitals. According to the U.S. Bureau of Labor and Statistics, approximately 2.5% of healthcare workers have left the field, with an average of over 500,000 employees per month between June 2022 and October 2022.
The effect of reduced staffing and medical errors has not been thoroughly studied, and readers should beware of correlation versus causation. However, a 2019 study linked inadequate nurse staffing as a cause of reported medication administration errors. According to a survey of physicians in the United States and Europe are observing increased wait times and feeling the impact of reduced staffing.[9] Whether staffing shortages increase claims in medical malpractice cases and, ultimately, additional costs to the hospitals is yet to be determined.
How the backlog in previously filed medical malpractice cases and the convergence of newly filed cases will impact a hospital’s cost is yet to be decided. However, changes in the legal and employment landscape seem to be already affecting not-for-profit hospitals’ bottom lines. According to VMG’s study, total operating revenue for hospitals was down 0.2 percent from 2021, and “days cash,” the number of days an organization can pay its operating expenses, dropped 18.2 percent. The study included 564 hospitals with a combined fiscal year operational revenue of 184.0B.
Disclaimer: This publication is not intended to provide legal advice but to provide general information on legal matters. Transmission is not intended to create and receipt does not establish an attorney-client relationship. Readers should seek specific legal and/or medical advice before taking any action with respect to matters mentioned in this publication. The attorney responsible for this publication is John Senese. This post constitutes a form of attorney advertising as defined by some state bar associations.