Physicians know that with the practice of medicine comes the risk of being sued for medical malpractice. When there is a malpractice lawsuit or settlement resulting in payment by a carrier, there is a required report made to the National Practitioner Databank (NPDB). I previously wrote a blog on the NPDB which you can see here.
A primary purpose of the NPDB is to serve as a mechanism for sharing information. Once a report is made, it is forever located in the databank for states, hospitals, and other third parties to discover. As it related to malpractice, the NPDB requires:
“For each entity (including an insurance company) which makes payment under a policy of insurance, self-insurance or otherwise in settlement (or partial settlement) of, or in satisfaction of a judgment in, a medical malpractice action or claim shall report…information respecting the payment and circumstances thereof.”
The requirement to report to the NPDB is triggered by written demand for payment related to an act or omission of a physician and the payment of an amount by a carrier. In 2014, $3,891,743,050 was paid out in malpractice cases, according to the NPBD. However, this number is likely an understatement of the true “malpractice” payments being made because there are, in fact, ways in which physicians avoid being reported to the NPDB.
One way to avoid a report is to win a malpractice case. As a result, avoiding a NPDB report actually encourages physicians to continue lawsuits rather than settling and although expensive, some studies suggest that physicians who go to trial have a high success rate.
Another way to avoid a NPDB report is to avoid a lawsuit. Talking with patients orally when they are upset or seeking reparation, and reaching an agreement to refund payment or cover expenses, can all help a physician avoid a NPDB report (as long as there is no payment made by a carrier). Demands for payment which are satisfied by cash paid by physicians also will avoid a NPDB report. I often encourage my clients when faced with an upset patient to meet in person and talk through the issues. Although payment is sometimes made, patients often just want to be heard.
Other solutions to avoid filing a report to the NPDB have been explored by states introducing “Notice Statutes,” which require that physicians be given written notice before a lawsuit can be filed. The notice is intended to encourage the patient and physician to reach some understanding short of a malpractice lawsuit. Similarly, some clinics and even private practices use voluntary mediation contracts with patients, under which the patient agrees to submit a written demand for mediation (not a demand for payment). This starts a process that can potentially encourage resolution between the parties, short of a formal demand for payment and malpractice payment. Both are potentially viable options to avoid a NPDB report.
One final example is the “corporate shield,” which is used when corporate entities, such as hospitals, are sued. A settlement is reached and payment made only after individually named physicians are dismissed. Because only the corporate entity is named in the final settlement, there is no NPDB report made on the individual physicians. Physician should also be sure that when a case is dismissed against them, no identifying information is included in the judgment or settlement agreement.
Given the ways in which NPDB reports can be avoided, it’s hard to validate the accuracy of the NPDB data. If a report is made, it’s essential to work with counsel to submit clarifying statements. For example, a physician involved in an event that leads to a suit, limitation of staff privileges and a license denial, will have multiple reports even if they stem from a single occurrence. Wording of these reports can be negotiated by the physician. Surprisingly, few physician review and submit NPDB clarifications. In 2012, it was reported by the director of the HHS Division of Practitioner Data Banks, Cynthia Grubnbs, that out of 800,000 NPDB reports of all types, only 44,273 included physician statements!
Finally, be careful what you sign. Employers and physicians have divergent interests when it comes to malpractice. Try to avoid contracts that allow an employer to settle a case without physician consent and always contact personal counsel for advice. Avoiding malpractice actions should be the goal of every physician but when events do occur, it’s important to understand your options.