By Frank Connor
According to a recent decision by the U.S. Department of Health and Human Services, all negotiated resolutions of medical malpractice claims following a written demand for settlement must be reported to the federal government, including under laws such as the Massachusetts statute designed to encourage disclosure of medical errors, apologies by practitioners, and early pre-suit settlements.
The HHS issued a decision in May stating that settlements under certain malpractice reform provisions contained in the Massachusetts healthcare reform law – even those involving claims where the standard of care was met – are not exempt from reporting to the National Practitioner Data Bank (NPDB). The NPDB tracks payments on medical malpractice claims, and any adverse actions against medical practitioners, including licensure and clinical privileges.
The Massachusetts medical malpractice reform provisions, effective November 2012, include the Disclosure, Apology and Offer model. The law mandates a six-month waiting period before a patient can file a medical malpractice lawsuit, during which pre-litigation communication between a patient and health care provider is encouraged.
A pilot program involving seven Massachusetts hospitals and a multispecialty physician group implemented the early settlement aspect of the law under a process known as CARe (Communication, Apology and Resolution).
Disputes submitted to the CARe program can result in referral to liability insurers for potential offers of compensation if the standard of care was not met. However, claims are not referred to the insurer if the standard of care is met or the patient’s injuries are minimal.
HHS determined that the pre-litigation notice in Massachusetts to initiate early resolution is a “written claim” if it includes a written demand for payment. It made no exception for cases where the standard of care has been met.
The HHS decision suggests that the NPDB could modify its reporting form to reflect whether the standard of care has been met in specific cases.
The agency’s ruling was also directed to a similar law in Oregon, which law provided that a settlement payment under its mediation program is “not a payment resulting from a written claim or demand for payment.”
This clause of the Oregon law, now effectively negated by the HHS ruling, was directed at the NPDB reporting requirement that applied to all medical malpractice settlements with a written demand.
Frank Connor is a partner at Barton Gilman LLP. He has dedicated his career to defending medical professionals in the courts of Rhode Island and Massachusetts, before the licensing boards in both states, and against billing investigations by private healthcare insurers as well as state and federal authorities.