What Every Victim of Medical Malpractice Should Know about the “Early Offer” Law

New Hampshire’s “Early Offer” system was passed into law despite Governor Lynch’s veto message advising that the bill was unbalanced and unfair to injured patients.  A legislature bullied by irresponsible leaders and misled by special interests passed the “Early Offer” bill, despite the Governor’s veto message and despite its many flaws and inequities.  Here are a few things you need to know.

 

Read these latest letters from New Hampshire’s largest Medical Liability Insurers:

Coverys June 13 Letter to Governor – June 13, 2012 (PDF file)

Medical Mutual June 12 Letter to Governor – June 12, 2012 (PDF file)

 

The Governor vetoed the so-called “early offer” bill (the Early Offer system) calling it unfair and unbalanced. Since that time, a great deal of misinformation has been spread to NH House Members as supporters of the Early Offer system scramble to revive their unfair and unbalanced proposal. In the name of fairness, and balance, we want people to know the truth. We do that by comparing the language of the Governor’s Veto and the language of the Early Offer system in question.

 

The Governor says the Early Offer system would be the first statutory early offer program in the state. He is correct.

The early offer idea has been shopped around at the federal and state level for over a decade without any buyers. The Early Offer system seeks to take a voluntary system that is offered by many insurers, including some here in New Hampshire, and create a new statutory scheme, replacing what the “free market” has already fine tuned. Few know these already exist because there have been no complaints thus no reason for a news story. The Early Offer system is a solution in search of a problem.

 

The Governor says the Early Offer system does not sufficiently and fairly balance the interests of the general public with the interests of medical providers. He is correct.

Under the proposal, if a patient received an early offer that would not reimburse their full out-of-pocket costs, then he or she would be required to post a bond (sufficient to cover the provider’s legal fees and costs) before he or she could file in court and ask a jury to hear the case. Even if the patient only wanted reimbursement for his or her full medical costs and lost wages, he or she would still be required to post that bond. And, even after posting the bond, the injured person would still have to take his or her case to a “medical screening panel” before being able to proceed to court. What, you might ask, are the parallel burdens on the medical provider responsible for the injury? None.

 

The Governor says the Early Offer system lacks certain fundamental safeguards necessary to protect injured patients. He is correct.

Let’s start with the fundamental safeguard of informed consent. Before an injured patient may participate in this system, he or she must first sign a waiver of Constitutional Rights that indicates participation “may” affect his or her rights. “May” is an incorrect word; the waiver will affect their Constitutional Rights to take their dispute to court before a jury of their peers. The injured person would have to buy back the rights guaranteed under the NH Constitution Part I Articles 14 and 20 under the Early Offer system. The waiver also does not explain that, in entering the early offer system, the injured patient will not be allowed to seek compensation for lost earning capacity, loss of mobility, loss of sight or other such devastating losses directly caused by the injury. Instead, the early offer system sets a uniform price tag on the loss of enjoyment of life. It sets a price tag on life as well, valuing a family’s loss for the death of a victim at $140,000. (519-C:1, IV) Attempts to make the extent of the loss of rights clear in the waiver were rejected by proponents of the Early Offer system.

 

The Governor says the Early Offer system does not give enough time for an unrepresented patient to consider whether to opt in to early offer, contrasting the five days a victim has to decide whether to sign a waiver with the 90 days given to the medical provider to make an offer after the injured has already given up the right to a court and jury trial. He is correct.

Even worse, the Early Offer system calls for the unrepresented patient to make a decision after meeting with a “neutral advisor” who would be hired and paid for by the medical care provider or their insurance company. (519-C:3) Not only does this create a mockery of the word “neutral,” it also creates the possibility of new litigation as a patient could well challenge the role of the neutral based on conflict of interest and related bias.

 

The Governor says the Early Offer system contains a loser pays provision inappropriate for medical malpractice cases. He is right.

The Early Offer system requires that a patient who opts in to the early offer system buy back their constitutional right to trial by jury by posting a bond and paying for defense attorney fees unless they can convince a jury to award them 125% of the losses they have incurred. Consider a patient who, after having waived the right to go to court, finds out that the medical provider refuses to reimburse for $20,000 on a total medical bill of $175,000, arguing that a portion of the treatment was experimental or unproven, even though it worked for the injured. If the injured asks for $175,000 to reimburse the full medical costs, and the provider offered only $155,000, the claimant would need to have a jury award $193,750- more than actually owed- to avoid having to pay the provider’s legal fees and costs! This standard would be impossible to meet.

 

The Governor says the Early Offer system needs more work. He is right.

In its current form, the Early Offer system contains major inconsistencies. For example, under 519-C:2, XII, the “Loser Pays” provision, the Early Offer system imposes loser pays sanctions in any case in which a patient is not awarded “at least 125 percent of the early offer amount.” Contrast that with the Waiver of Rights language at 519-C:13 which calls for loser pays if an award is “equal to or less than 125 percent of the amount of the early offer.” Which is it? What happens if a jury actually awarded exactly 125% of the offer? More litigation no doubt. We can only wonder how many hours would be spent debating the legislature’s actual intent.

 

The Governor says he is vetoing the Early Offer system “in order to adequately protect the interests of injured patients.” We agree with him.

So do the two largest medical malpractice providers in the state, both of whom oppose the Early Offer system, both of whom already have a system for quick resolution with no complaints and thus no need for government intervention. So do victim advocates from all over the state. So do Law Professors from the University of New Hampshire School of Law and New York Law School. So does a national advocacy group that works to protect constitutional rights. It is not easy to stand up against powerful special interests and veto this Early Offer system. But it is fair.


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