Woman’s medical nightmare is argument against malpractice caps, lawyers say

Schelley Sanders went into a Davenport hospital on her 35th birthday in 2003 to have her fallopian tubes tied, a relatively simple procedure, but a surgeon's mistake almost killed her.

That near-death experience and her resulting poor health, some Iowa attorneys said, make the case against capping the damages patients can receive in medical malpractice cases.

During her surgery, Sanders' surgeon unknowingly punctured two holes in her bladder. He ignored her complaints of horrible, abnormal pain and sent her home, where she developed sepsis, a life-threatening infection that affects the entire body.

She then developed a flesh-eating virus from the medications to fight the infection and lapsed into a “locked in” state for several months. She couldn't move, she couldn't speak, she had no muscle control. She could communicate only with her eyes.

She spent five and a half months in the hospital. She had to learn to walk and talk again. Her medical expenses totaled $1.9 million.

Now 42, she will never fully recover. She can't sit or stand for long periods of time, and she can never work again. She had worked as a bank teller and receptionist to support herself and her two sons after two divorces. She is heavily medicated for chronic pain - more than 20 pills a day that make her tired and sluggish.

Sanders, who lives in Moline, Ill., sued her doctor in 2004 and settled for a confidential amount last April 1. If she hadn't received the settlement, she said, she would be homeless or living in public housing.

Cedar Rapids lawyer Tim Semelroth, a past president of the Iowa Association for Justice, said if Iowa had malpractice caps, Sanders could never pay for the medical treatment she required.

Iowa doesn't have malpractice caps, but Semelroth said the insurance industry has pushed since the 1970s for such caps during economic downturns.

Iowa hasn't enacted the caps, he said, because past governors, like Robert Ray and Tom Vilsack, had enough “real-world legal knowledge” to recognize that caps don't improve the quality of health care.

“Caps on quality-of-life damages are a sham cure,” Semelroth said. “History shows caps don't lower insurance rates for doctors. Caps don't lower insurance rates for patients. Caps just make more money for insurance corporations. That is why caps get proposed every time the insurance industry loses money in the market.”

Study looks at caps

Semelroth cites a study released by the Iowa Association for Justice and conducted by the American Association for Justice - a state and national organization of trial lawyers who work to strengthen the justice system - that shows malpractice insurer profits are 24 percent higher in states with caps on malpractice damages than in states without the caps.

The study, using data from the National Association of Insurance Commissioners and company annual statements, found that, in 2008, the average profit of the 10 largest medical malpractice insurers was higher than 99 percent of Fortune 500 companies.

In states with caps, the study found, insurance companies took in 3.5 times more in premiums than they paid out in 2008. In contrast, insurers in states without caps took in just over twice what they paid in claims, the study found.

Semelroth said he found 27 states have capped quality-of-life damages in medical malpractice cases. The average cap that gets proposed is $250,000, but that can vary by how each state implements them, Semelroth said.

Texas, for example, uses a graduated cap, where an injured patient can seek $250,000 from a health-care provider and $250,000 from health-care centers.

The study also found no correlation between the cost of malpractice premiums and health insurance premiums. Maine, for example, has the ninth-lowest malpractice premiums but the fourth-highest health insurance premiums. Nevada has the third-lowest health insurance premiums but the ninth-highest malpractice premiums, despite having a malpractice cap for eight years.

Iowa has the fifth-lowest medical malpractice premiums and the 13th-lowest health insurance premiums, according to the study.

Libby Lincoln, general counsel for Midwest Medical Insurance Co. in Minnesota, with a branch office in West Des Moines, said nobody can argue the insurance company profits cited in the study, but it doesn't show the entire picture, she said.

The study, she said, looks only at the amount paid out on claims. It doesn't show the reserve funds that an insurance company has to show on its books to cover claims. She said the study also doesn't show how much it costs the insurance carriers for defending these claims.

Midwest Medical and many other insurance carriers are partly owned by the policy holders - the doctors who are insured. Midwest is 60 percent owned by physicians.

“Any unanticipated profits are returned to the policy holders,” Lincoln said. “Since 1995, over $25 million was returned to holders.”

Arguments against caps

Semelroth said patients like Sanders would be hurt by such caps, and it would be difficult for attorneys to represent them because such cases are time-consuming and expensive to litigate.

His firm's average cost to bring a medical malpractice case to trial is $50,000 and sometimes reaches twice that amount, Semelroth said. That amount doesn't include the time of the attorneys, just the cost of hiring medical experts and collecting evidence.

Semelroth said they receive about 300 calls a year related to malpractice but file only about 10 to 15 because of the expense and merit of the cases.

“If we made a habit of filing medical malpractice cases without merit, we would quickly go bankrupt,” Semelroth said.

Attorneys who win malpractice cases receive a contingency fee, usually one-third to 40 percent of the settlement.

Larry Helvey, a Cedar Rapids lawyer and an emergency room doctor at St. Luke's Hospital, believes malpractice caps are a bad idea. It's not fair, he argues, to put a blanket cap on patients who are victims of malpractice.

“Some are disabled for life, and there's pain and suffering for life,” Helvey said. “I don't know how you put a cap on that.”

Helvey, also the former medical director of St. Luke's emergency room, said he's in the unique position of being a doctor and a lawyer. He said he would prefer reform to make medical malpractice insurance more like car insurance.

“It would be more fair,” Helvey said. “You run into someone's car, and you pay whatever the damages are to repair it. Wouldn't that make more sense?”

Helvey said he believes most doctors would like to step up and pay if they make a mistake, but the “insurance companies won't let them and their lawyers won't let them.”

Surviving

Sanders said she suffers daily from the long-term effects of a doctor's mistake.

“I'm deaf in one ear and have partial hearing loss in the other,” she said Monday as she sat, wrapped in a blanket, on the couch in her Moline home. “I could totally lose my hearing someday. I have pain all the time. I also have a blood clot in my left leg. My lungs have collapsed, and I have to have oxygen when I sleep. I have limited muscle control and movement in my left foot.”

Sanders wrapped the blanket around her a bit tighter as she talked about being diagnosed in 2008 with ovarian cancer. She had a hysterectomy and went through chemotherapy, but the cancer came back last year. She is currently going through chemo again.

The doctors told Sanders that further surgery is too risky.

Michael Bush, the Davenport attorney who represented Sanders in her medical malpractice lawsuit against Dr. Dennis Xeureb, who is now retired, said malpractice caps are unfair to patients like Sanders.

“It's a miracle she survived,” Bush said. “The $1.9 million in medical expenses doesn't even include the ovarian cancer. An oncologist said nobody knows what causes ovarian cancer, but based on numerous studies, all the scarring and over 80 X-rays put Sanders at high risk.”

Sanders said she is determined to survive.

“When they gave me 10 exercises to do, I would do 20,” she said. “ I didn't listen to those who said (you) can't.”

Sanders said she is thankful Iowa didn't have malpractice caps when she sued, given that the final award was large enough to cover the majority of her medical expenses, allow her to have a home and send her two sons to college this year.

“Doctors can't do this and get away with it,” she said. “I've forgiven my doctor a long time ago, but it helps that he's no longer practicing. They have to look at human life and figure it's worth something. This took everything from me.”