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Special interests clash over medical malpractice reform

POSTED: February 23, 2014 11:49 p.m.

State Sen. Butch Miller, R-Gainesville, is co-sponsoring a bill aimed at reforming the state’s medical malpractice system and lowering health care costs. His picture was on a mailer sent to many Hall County homes in January, asking residents to thank him for his support of the bill. 

The mysterious source of the mailer is just one aspect in the fight over the Patients’ Compensation Act (SB 141), which has turned out groups with vested interests on both sides of the issue, each clamoring to defeat or pass the bill as millions of dollars are at stake.

Proponents are touting the bill as a countermeasure to the Affordable Care Act, saying it will lower premiums, co-pays and deductibles by eliminating incentives for doctors to order unnecessary and redundant medical procedures and tests. 

The state’s tort system responsible for malpractice claims would be replaced with an administrative model, with claims handled by an independent review board. 

“As for the direct mail piece, I have no clue as to the source or the motive of the anonymous sender,” Miller told The Times. “It’s also interesting to note that the bill has not been voted out of (the Rules) Committee nor passed on the Senate floor; not to mention it also needs to pass the same process in the House and be signed by the governor. As of now, it’s a moot point.”

While the legislation has not gained traction this year, the scope of its content has advocates and opponents squaring off about its intent.

“We believe there is such an epidemic of defensive medicine being practiced that it’s costing us billions of dollars,” said state Sen. Brandon Beach, R-Alpharetta, the bill’s chief proponent in the General Assembly. “If doctors don’t believe they’re going to be sued for these jackpot justice lawsuits, then they would reduce the tests they are running, and consequently reduce our health care costs.”

Proponents also say only one in five injured patients receives malpractice compensation under the current system, while taking less than 20 percent of the award given them after paying lawyers. 

But the legislation has drawn a critical rebuke from the Medical Association of Georgia, with officials saying the bill would impose a hefty tax on doctors and hospitals, thereby increasing the costs of health care services. MAG also says claims for minor injuries would rise dramatically, perhaps by as much as 1,700 per year in the state. 

Additionally, opponents say the legislation would pull a bureaucratic wool over malpractice suits in the state, tying up claims in a legal patchwork of administrative filings and ending the right to a jury trial. 

This isn’t the first time the Patients’ Compensation Act has worked its way into debate in the General Assembly. Last year, it was introduced as the Patient Injury Act, but failed to garner the attention and votes needed to proceed out of committee. 

But Beach has broader support this time, as well as lobbyists working on his behalf.

The return address of the mailer with Miller’s photograph, listed as 2655 Northwinds Parkway in Alpharetta, pinpoints its origin. That address houses the offices of Jackson Healthcare, one of the largest conglomerate health care staffing firms in the United States, and a major backer of the Patients’ Compensation Act. 

CEO Rick Jackson serves as founder and chairman of Patients for Fair Compensation, a nonprofit that has embarked on an aggressive marketing campaign — including the mailer — to sell businesses, physicians and Georgia taxpayers on the need for medical malpractice reform. 

In July, Patients for Fair Compensation launched two campaigns, Doctors for a Healthy Georgia and Taxpayers for a Healthy Georgia, to meet this goal. 

Hall County residents who received the Miller mailer found a website listed with a promise of more information. Another website is directed at doctors and shares testimonials from a few physicians supporting the Patients’ Compensation Act.

Both websites are registered to the Stoneridge Group, an Alpharetta-based firm that produces advertising campaigns for national and state Republican candidates and groups, including Gov. Nathan Deal, Arizona Sen. John McCain and former Speaker of the House Newt Gingrich. 

Wayne Oliver, a longtime Georgia lobbyist for the pharmaceutical industry and executive director of Patients for Fair Compensation, said his organization hired the Stoneridge Group to direct its campaigns, adding he wasn’t trying to hide its motives or ends related to the mailers and marketing campaigns it has directed in recent months. 

“There’s a lot of miscommunication out there as to what we did and didn’t fund,” Oliver said. 

Meanwhile, Oliver pointed the finger at MAG, a powerful organization he said he believes has a sizable financial stake in maintaining the status quo. 

MagMutual, a profitable medical malpractice liability insurer for physicians and hospitals, is a major financial supporter of MAG. The insurer also unveiled a new medical malpractice policy on Wednesday. 

According to the association’s website, “MAG does not own MagMutual; however, we fully endorse and work closely with the company.”

“MAG is clearly conflicted here,” Oliver said. 

But when it comes to money, both sides have perceived conflicts. Opponents of the bill charge that huge profits are to be reaped by companies like Jackson Healthcare if an administrative model supplants the current malpractice system. 

Additionally, money is flowing into the coffers of candidates and political action committees. For example, campaign finance reports from last October show Beach received $10,000 in contributions from Jackson Healthcare. 

Meanwhile, MAG funded its own lobbying political action committee with more than $50,000 last year. 

Interesting, however, is the fact Miller received $1,900 in campaign contributions from the Committee for Responsible Health Care Policy, the political lobbying arm of the Georgia Society of Anesthesiologists, which opposes the Patients’ Compensation Act. 

Miller also received a few thousand dollars in contributions from organizations such as the Georgia Optometric Association and Georgia Hospital Association PAC, both of which take no position on the bill. 

Yet, for all the lobbying, the bill appears to be headed for a new round of debate in 2015, a prospect even its supporters concede. 

“With health care costs skyrocketing across the nation, it’s become a priority for the Georgia General Assembly to find ways to reduce the financial burden of health care without blocking accessibility or services,” Miller said. “I don’t necessarily believe that SB 141 is the ultimate solution, but I do believe it is a starting point for several discussions.

“I will continue to engage in open conversations about this bill — and other health care issues — for as long as it takes to produce viable solutions that adequately address Georgia’s health care needs,” Miller added.

Beach said he would continue to push the bill through the General Assembly, but admitted it’s likely to die again in the Senate Health and Human Services Committee. 

“I’m not bringing it forward right now because I don’t have the votes,” Beach said. “I don’t want to lose. This may be something that comes up next year.”


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