The Medical Malpractice Insurance Crisis Hoax. (the Corporate Drive for Legal Immunity)

Article excerpt

Two YEAR OLD STEVEN OLSEN did not know how much his sight and cerebral functions were worth until he lost them.

The arbitrary price, $250,000, was set by the California legislature in 1975 for all victims of medical negligence. The law prevents a jury from awarding victims more for pain and suffering, and other "non-economic" losses.

In January, President Bush announced he wanted to adopt California's little known standard for the nation. A liability cap, he claimed, would address a supposed national crisis of escalating malpractice insurance premiums so severe that doctors in several states have gone on strike in protest.

"This problem will be solved by getting at the source of the problem, which are the frivolous lawsuits," President Bush announced to an audience of doctors in Scranton, Pennsylvania. "Look at states which have done a good job of helping the patient out. California is one example. More than 25 years ago, they passed a law that caps damages from malpractice suits, and the law has worked."

Two weeks later, in his State of the Union speech, Bush declared, "Because of excessive litigation, everybody pays more for health care, and many parts of America are losing fine doctors. No one has ever been healed by a frivolous lawsuit. I urge the Congress to pass medical liability reform."

President Bush never met Steven Olsen. But the president's critics say the Olsen case and the impact of California's legal restrictions on injured victims shows that taking power from juries to dispense justice for injured patients has resulted in greater victimization, higher health care costs and more insurance company abuse.


A San Diego jury determined that Steven Olsen would be healthy today had a doctor given him the $800 CAT scan that his parents repeatedly requested. Steven had been impaled with a stick and was rubbing his head, but was sent away with a growing brain abscess.

Ten years earlier, Steven Olsen would have received that CAT scan. But in 1992, the admitting doctor that treated him was operating under the new rules of managed care medicine: less is more. Steven's parents brought him back to the urgent care clinic and hospital three times. Steven was repeatedly refused the scan, but was pumped up with steroids. Finally, Steven returned comatose.

The jury provided $7.1 million for Steven's lifetime of darkness, suffering and cerebral palsy. Unbeknownst to the jury, however, the verdict was reduced to $250,000 by the legislature's cap on damages. That's about $4,000 for every year of his life if he lives only until sixty.

The jury foreman, Thomas Kearns, found out about the reduction reading of it in his local newspaper. Kearns expressed his dismay in a letter to the editors of the San Diego Union Tribune:

"We viewed video of Steven, age two, shortly before the accident. This beautiful child talked and shrieked with laughter as any other child at play. Later, Steven was brought to the court and we watched as he groped, stumbled and felt his way along the front of the jury box. There was no chatter or happy laughter. Steven is doomed to a life of darkness, loneliness and pain. He is blind, brain damaged and physically retarded. He will never play sports, work or enjoy normal relationships with his peers. His will be a lifetime of treatment, therapy, prosthesis fitting and supervision around the clock."

"Our medical-care system has failed Steven Olsen, through inattention or pressure to avoid costly but necessary tests. Our legislative system has failed Steven, bowing to lobbyists of the powerful American Medical Association (AMA) and the insurance industry, by the legislature enacting an ill-conceived and wrongful law. Our judicial system has failed Steven, by acceding to this tilting of the scales of justice by the legislature for the benefit of two special-interest groups. …