Malpractice Risks Rise With New Pressure on Doctors to Undertreat

Lee J. Johnson, Esq.; Frank J. Weinstock, MD

Disclosures

August 04, 2011

In This Article

Introduction

Doctors are stuck between a rock and a hard place.

Overtreatment may be bad for healthcare costs, but doctors sometimes feel pressured to go too far in the other direction. Managed care organizations (MCOs), accountable care organizations (ACOs), and other new payment forms designed to lower costs often exert pressure on doctors to avoid various tests and procedures. The government, hospital, or insurance company may scrutinize the physician's records, and any of them may exert "pressure" to do less costly testing and fewer treatments and procedures.

However, the physician faces a liability risk if he misses a diagnosis.

The danger to the patient is in missing the diagnosis or in failing to offer the best treatment. The doctor can be sued for malpractice for failure to diagnose or treat properly. Doctors are held to the standard of care of the reasonable physician in his specialty at the time of the treatment regardless of financial demand by third party payers, MCOs, or the newly proposed ACOs.

ACOs: The Latest Pressure to Undertreat

An ACO is a network of doctors and hospitals sharing responsibility for providing care to patients. In the new federal healthcare law, an ACO would agree to manage all of the healthcare needs of a minimum of 5000 Medicare beneficiaries for at least 3 years.

ACOs may create additional administrative costs and possibly reduced reimbursement. But for doctors, there is the specter of increased malpractice liability when physicians are asked to limit expenditures for tests and treatments of ACO patients. How can doctors deliver the same standard of care under these pressures? And if they don't, how will they be protected? Regardless of any outside pressures, the physician remains responsible and liable for their patients' care.

Financial Incentives to Decrease Care

The proposed ACO model offers doctors and hospitals financial incentives to provide good quality care to Medicare beneficiaries while keeping down costs. What is new is the emphasis on cost reduction. Guidelines for this program, which starts in January 2012, are being proposed.

ACOs wouldn't completely do away with fee for service. But the idea is that providers would get paid more for keeping their patients healthy and out of the hospital.

Hospitals could be held accountable not only for the cost of the care they provide but also for the cost of services performed by doctors and other healthcare providers in the 90 days after discharge.

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