Justinian Lane

Medical Malpractice Tort Reform Backfires in Florida

Several years ago, Florida passed tort “reform” that among other things was supposed to help doctors afford medical malpractice insurance.  Guess what happened?  As usual, the insurers barely dropped their premiums after the “reform” passed.  But now doctors are just choosing not to buy insurance coverage because they’ve realized that being uninsured makes it less likely they’ll be sued.  And, even if they are sued, they can just file bankruptcy:

"I have a strong feeling I'll never hear from another attorney again," Rosenbaum said. "Sure, I'm nervous. But I practice carefully. The first thing lawyers do when they have a case is [check] all the doctors involved to see who has how much coverage." [Sad but true.  The assumption is that if a doctor doesn’t have medical malpractice insurance, he doesn’t have any money to satisfy a judgment. – JCL]

Financial advisors now specialize in sheltering doctors' assets from malpractice verdicts. Marc Singer, a partner at Singer Xenos Wealth Management in Coral Gables, said he advises doctors to drop coverage and, if sued, offer the patient a choice: a small settlement or get nothing when the doctor goes bankrupt. [And people call lawyers unethical. – JCL]

"The idea here is not to beat the patient, the idea is to lower the expectations of the plaintiff's attorney," Singer said.

Bankruptcy has become a growing option for uninsured doctors, experts said. Federal and state laws shield the main home, retirement accounts, annuities and life insurance from malpractice awards.

Uninsured Juno Beach neurosurgeon Jacques Farkas filed for bankruptcy in 2004 after two patients sued. In the more severe case, a paralyzed man said in a lawsuit that his brain was pierced by a back rod Farkas implanted badly. Bankruptcy court records show Farkas sheltered $2.6 million in assets, including a $1.6 million oceanfront home. His payout to creditors: $16,200. The two patients got nothing. [While the doctor lives the life of a rock star, the patient lives in a wheelchair.  And I bet taxpayers picked up the tab for that wheelchair, too. I also wonder why the bankruptcy “reform” act doesn’t prevent millionaires from filing bankruptcy, when it prevents middle-class debtors from doing so.– JCL]

"Fair or not fair... he did what the law allowed," said Charles Cohen, a Farkas attorney who said the doctor denies wrongdoing in the surgeries.

Attorneys said declaring bankruptcy gives doctors another edge. If a malpractice award does not get paid because of bankruptcy, the state no longer considers a doctor in violation for not paying it, preserving his or her medical license. Only a handful of doctors have lost licenses for not paying. [This sucks.  And it sucks because it’s a necessary consequence of bankruptcy protection; filing bankruptcy is your legal right, and it’s not fair to punish you for doing so.  - JCL]

Source: Uninsured doctors on the rise in South Florida -- South Florida (H/T to Walter)

Thanks to tort “reform,” injured patients are getting little or no compensation, and taxpayers are paying the medical bills for the injured patients.  Good job, Florida Legislature.

Justinian Lane: Author Bio | Other Posts
Posted at 11:45 AM, Aug 04, 2008 in Medical Malpractice
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At the same time that the poeple of the State of Florida voted to decrease how much attorneys could take in the awards of medical malpractice cases a second amendment to the state consititution was added by the trial bar. This was to find a way to capture money from physicians who could no longer afford or opted out of malpractice insurance. This was a policy that stated that if a physician had three awards against him that they would lose their liscense. This allowed attorneys to say if you don't settle with us for what we want you risk losing your liscense. Further, if you don't pay even with guarded assets no matter how frivoulous the case, you culd possibly loose your career. This was ontop of the problem for those who were insured were it was far cheaper for the insurance company to settle a case rather than to fight.

The economic reality is that it is still far more expensive to practice in Florida that in other states. If you cant afford the insurance, you have to go bare. Either way it will cost you.

Posted by: throckmorton | August 4, 2008 1:19 PM

Florida has passed a ton of "reform" measures to protect doctors:

Punitive damages must be proven by clear and convincing evidence, and is limited to $500k.

Periodic payments are allowed.

Noneconomic damages against emergency room docs are limited to $150k. Even then, a plaintiff has to prove "reckless disregard" to recover against ER.

Caps against other doctors of $500k.

Contingent fee caps between 15% and 33.3%, depending on the amount recovered.

At some point, shouldn't we admit that tort reform isn't working?

Posted by: Justinian Lane | August 4, 2008 2:34 PM

Although, I oppose tort reform, I support the homestead exemption of Florida. I would like to see it enacted in the remaining states. I support allowing renewal of licenses without proof of insurance.

The lawyers know that if they pursued blood money, first, they would watch their families killed, before they would be.

I support forcing all lawyers to carry legal malpractice insurance. That includes the cult criminals on the bench. That way, adverse third parties could always be suing them for damages caused by their carelessness.

Justinian, I still await your reply as to whether the great benefits of torts should help the victims of the lawyer profession, and help to improve the services of the lawyer profession. I still await your reply as to whether the privity obstable to such actions should be reversed by statute. No one has had that shield for the past 100 years.

Posted by: Supremacy Claus | August 4, 2008 2:51 PM

This is a great article from Jack which summarizes the situation in Florida:

By JACK JAWITZ Special to the Tribune

The Tampa Tribune

Published: May 6, 2008

If you were a doctor, would you move to Florida if you knew how this state treats your profession?

• Liability insurance is so costly (when available) that two out of three physicians in south Florida are uninsured. Florida statute requires an uninsured doctor to have $250,000 for a settlement to practice medicine in Florida while on staff at a hospital. If you do not have this you will lose your license.

• The Florida malpractice carriers have the ability to settle a case whether you agree with them or not and whether you did wrong or not.

• You are held personally liable for all monetary judgments over your practice liability limits unless you tell the insurance company to settle the case for the limits whether you did wrong or not. The average Florida case is for over $1 million today.

• The Florida Constitutional limits of $500,000 on non-economic (pain and suffering) damages are unconstitutional per circuit court. This appeal is now before the Florida Supreme Court.

• The Florida Supreme Court has ruled that an expert witness may testify based on their personal knowledge or experience and not based on the medically accepted norms in the field of their expertise.

• Florida is the only state in the union to have a "three strikes and you're out" constitutional amendment. This broadly interprets that should a Florida jury or arbitrator find you at fault for a malpractice event, you will be assigned a strike. This is retroactive, and incidents in other states count. After three strikes, your license will be permanently revoked.

• The Florida Supreme Court has ruled that all medical expert testimony, whether true or a complete lie is fully protected on the witness stand and granted absolute immunity ... expert perjury, libel, or slander is legal.

• All hospitals are required to have committees (such as peer review, infection control, patient safety data, clinical privileges, internal risk management, etc.) for the medical profession to constructively find opportunities for improvement. In the past these "hospital improvement committees" were protected from legal discovery so physicians were encouraged to speak up and seek the truth for the benefit of system improvement. It is now the position of the Florida Supreme Court that all these previously protected meetings, retroactively to the beginning of the hospital, shall be open to inspection, discovery and scrutiny. A physician can be drawn into legal liability just for participating in these required committees. Most lawyers advise physicians not to participate in their own hospital improvement committees.

Well, after all the personal sacrifice to become a doctor, and to be told of these facts by practice recruiters and hospital headhunters looking for doctors in other states, I would decide not to move to Florida.

What would you decide? I made a decision to move to Florida 23 years ago before all the rulings and amendments.

I will be retired in five years. Who will replace me I ask?

Jack Jawitz is a physician practicing in Sun City Center.

Posted by: throckmorton | August 4, 2008 3:22 PM


As a practicing attorney I carry liability insurance and professional liability insurance. As far as I can tell if I make a mistake I can be held liable in a court of law. However, I haven't made any actionable mistakes (I'm sure I wore a missmatched tie when my wife was away, but other than that no mishandled cases). I fail to see what your beef is with the legal profession. We are more accountable here in Florida with the Bar disciplining attorneys than the Medical profession has even pretended to be. Dr. Farkas is a prime example of the irresponsible physicians we are plagued with.

Posted by: Steve | August 4, 2008 3:24 PM

Steve: I love the lawyer, the law, and jurisprudence. My love is so great, it is great enough to correct their serious mistakes.

You have rigged airtight. You can file bogus lawsuits, and the adverse third party has no recourse. In the misuse of civil procedure, one must prove scienter and malice. Short of a taped confession, those actions are shams. Rule 11 sanctions of 1983 were set back in 1993 due to excessive accountability of lawyers. Now, you have a 21 day take backsies and the advantage of notice before sanctions apply. All defendants should have 21 days of notice and take backsies before being sued.

The adverse third parties that have sued careless lawyers for malpractice have been pushed back by their lack of privity. No one else has had that shield since 1905.

The courts, in a gentlemen's agreements, have ruled that the lawyer has no duty to the adverse third party. Yet, there are hundreds of enumerated duties to the adverse third party in the Rules of Conduct, of Evidence, of Civil and Criminal Procedures, and hundreds of common law appellate decisions. The lawyer may have a larger number of enumerated duties to the adverse third party than to the client.

The term adverse third party is a non-partisan term. The plaintiff should be able to sue the other lawyer for filing a bogus defense.

You are referring to insurance to protect the client, the second party. I am referring to the adverse third party. The latter should also be able to sue the judge when falsely sentenced to death.

I am willing to allow tort reform protections for the lawyer, despite my opposition to all tort reform. So a certificate of merit should be required with the lawsuit filing. The burdens of proof can be higher for exemplary damages, etc.

Posted by: Supremacy Claus | August 4, 2008 3:42 PM

I don't see the causal nexus between Florida tort reform and more Florida doctors practicing while uninsured. If anything, your post seems to indicate that doctors' practicing without insurance is due to a combination of: (1) trial lawyers' desire for deep(er) pockets; and (2) state homestead protection and bankruptcy laws.

Think of it this way: if the tort reforms were repealed, why would we expect more Florida doctors to suddenly purchase insurance?

In sum, Justinian, I think the "backfire" notion needs some fleshing-out.

Posted by: Lawyer | August 4, 2008 5:35 PM

Allow me to flesh it out. Part of the reason these "reforms" was to lower insurance premiums for doctors. Implicit in that goal is that the legislature expected doctors to buy the lower-priced insurance. But instead, doctors are simply choosing not to buy insurance for two reasons. First, the hurdles to bring a medical malpractice lawsuit are very high, which will reduce the likelihood that doctors will be sued. Second, doctors know that when they don't have insurance, it's even less likely they'll be sued.

If the tort "reforms" were repealed, I expect more doctors would buy insurance because (a) more lawsuits would probably be filed, and (b) the potential value of those lawsuits would be higher without damage caps. Thus, repealing those laws would make doctors feel like they're at greater risk of being sued. That's exactly what leads people to buy insurance.

So if a goal of tort reform is to increase the number of physicians with medmal insurance, Florida has failed.

But if the goal of tort reform is to simply reduce the number of lawsuits regardless of whether the lawsuits have merit... perhaps Florida has succeeded.

Posted by: Justinian Lane | August 4, 2008 5:49 PM

As you probably know, the contingency fee caps are easily circumvented - the attorney simply gets his client to agree to waive the cap - or he doesn't take the case. From what I've heard , all attorneys that handle the medmal cases have gotten their clients to "voluntarily" waive the fee caps, so the amendment really hasn't had much affect

Posted by: Avenger | August 5, 2008 6:11 AM

"[R]epealing those [tort reform] laws would make doctors feel like they're at greater risk of being sued. That's exactly what leads people to buy insurance."


Were there no bankruptcy protection available to doctors, I would tend to agree.

What bankruptcy protection does is negate that portion of liability above the doctor's non-protected assets. The larger that portion of liability that bankruptcy can negate, the more valuable bankruptcy protection becomes.

Thus, because of bankruptcy laws, increasing the potential damage awards against doctors has the *opposite* effect: it makes bankruptcy that much more attractive, relative to the required insurance premiums for the increased financial risk. So a "greater risk of being sued" means a greater desire for bankruptcy protection.

Posted by: Lawyer | August 5, 2008 11:16 AM

If Justinian understood the article, he would understand that the phenomenon he describes has nothing to do with tort reform, and everything to do with the combination of the trial-lawyer-imposed three-strikes rule (that creates a personal cost for doctors when insurance companies settle cases) and the unusual Florida bankruptcy laws that permit one to shield substantial assets. (Cf. OJ Simpson, who took advantage of this years ago to get out from under the civil verdict.) Nothing to do with tort reform, and his comments in this thread show that, even after the error was pointed out, he's going to keep the dishonest post title and not correct himself. Score another point for the dishonesty team.

Still, I am amused to see Justinian arguing that the federal bankruptcy laws should have included a preemption clause to eliminate individual states' choices to have huge homestead exemptions. I don't disagree, but perhaps Justinian should consider the effects of the lack of preemption when his knee jerks about it in other contexts.

(Separately: has Justinian ever had an honest post title? His record is surely less than 50% on that score.)

Posted by: Ted | August 5, 2008 1:54 PM

Speaking of dishonesty, Ted, please point out where I argue against permitting states to have homestead exemptions.

And are you suggesting that eliminating these "reforms" won't lead to an increase in high-dollar medmal lawsuits?

Posted by: Justinian Lane | August 5, 2008 2:11 PM


What you are looking for would spell the end of the judicial system. How could you find a judge who would hear cases if every decision would prompt a lawsuit from the losing party? In Florida with wrongful convictions, the Legislature is charged with passing a claims bill to compensate the wrongfully held prisoner. A recent case of a man wrongfully convicted of rape and held in prison for over 25 years resulted in the Legislature passing a claims bill for $1 million to that man.

I don't think holding the judge accountable individually would add anything to that situation. I mean the entire system failed that man, from the victim misidentifying him, to the state attorney charging him, to the jury deciding his guilt, to the defense attorney who couldn't convince them of his innocence until DNA 25 years later exonerated him.

Goes back to Old Voltaire, better to let a thousand guilty men go free than convict an innocent man.

Posted by: Steve | August 5, 2008 4:32 PM

Justinian wrote: "Ted, please point out where I argue against permitting states to have homestead exemptions."

Yet, just a few hours earlier, Justinian wrote: "I also wonder why the bankruptcy “reform” act doesn’t prevent millionaires from filing bankruptcy" -- when the only way a millionaire can file for bankruptcy and still be a millionaire is through the homestead exemption. Which is why Florida has this problem, and states without a huge homestead exemption and tort reform do not.

Does Justinian read what he posts, or does he just post without thinking about the meaning of what he posts?

Justinian also writes: "And are you suggesting that eliminating these reforms won't lead to an increase in high-dollar medmal lawsuits?"

Which simply shows that he either did not understand the article he linked to or the comment he responded to, or is trying to deliberately muddy the debate. The reforms have nothing to do with Florida's homestead exemption. Eliminate the homestead exemption, keep the reforms, the problem goes away. Keep the homestead exemption, eliminate the reforms, the problem gets worse.

Posted by: Ted | August 5, 2008 7:42 PM

"...when the only way a millionaire can file for bankruptcy and still be a millionaire is through the homestead exemption." Oh really? So then the extent of the advice of the financial advise the quoted advisor gives is to homestead? What say you and I open up a financial management shop down in Florida and help doctors with the homestead paperwork?

If there were absolutely ZERO "reform" measures in Florida, do you agree there would be more medmal lawsuits? I'm sure you do, else the major premise for tort "reform" is shot. Now, if there were no restrictions on medmal suits, do you agree that some of the suits would result in settlements or verdicts that are too small - say under six figures - for a doctor to want to file bankruptcy to avoid satisfying them? Seems like in such a scenario, doctors would be more likely to buy medmal insurance, doesn't it?

Agree with me or disagree with me - I don't care. But it's almost comical how you constantly accuse me of being dishonest when I simply have a different opinion than you. I think Vanilla is better than chocolate. Am I a liar if you prefer chocolate?

Posted by: Justinian Lane | August 5, 2008 8:25 PM

Steve: Those are intelligent and thoughtful concerns. Justinian refuses to answer the question at all. He wants it so that lawyers can sue all, and no one may sue them successfully. They are above the law because they run it. That justifies all self-help intellectually and morally.

Professionals get to set their standards of due care. So, I am willing to allow the tort reform measure requiring a certificate of merit with any claim. Another judge will have swear that the judge did something outside the standard of due judge care. I do not advocate strict liability for judges, as Justinian would like to enact for drug makers and doctors.

As to no one would want the judge job, that argument applies to people far busier and valuable than judges. My gardener makes more than judges. He would be far more missed than a judge should he become disabled. If a judge is eliminated, no one would care, nor even notice in their daily life. They do nothing but plunder on behalf of the land pirate. Make the judge carry professional liability insurance as the lawyer forces the doctor to do in most states. If the judge loses too many malpractice cases, insurance will refuse cases, and the careless judge will not serve on the bench anymore.

What are the goals of torts? Why do they not apply to the lawyer nor to the judge? The lawyer refuses to answer because it has Army Airborne to impose its tyranny.

Justinian: Here is a simple statistic to research. What fraction of medmal case verdicts favor the plaintiff? The standard set by the far more challenged criminal prosecution is 75%. If 75% of Florida medmal cases still favor the defendant, gross lawyer and judge malpractice persist.

Please, answer about your support or opposition to statutes ending all obstacles to ordinary professional malpractice claims against lawyers and judges. You too, Ted. Or explain why they have to have their immunities.

Posted by: Supremacy Claus | August 5, 2008 10:35 PM

Asset restructuring isn't free; it means being less liquid and, if one is married, there can be family-law complications. Some doctors don't want to file for, or have to threaten to file for, bankruptcy to avoid med-mal lawsuits. They'll buy insurance instead. That choice will depend upon the degree to which doctors are willing to hamstring their assets to get the protection they're seeking. For some doctors, insurance is the cheaper option; for other doctors, inconvenient asset structures and bankruptcy threats are the cheaper option.

There are two elements to that equation. First, the cheaper asset restructuring is, the more likely a doctor will choose it. Florida law makes asset restructuring relatively cheap through its homestead exemption. I don't think there's another jurisdiction that lets you keep a mansion after discharging debts. Second, the more expensive insurance is, the more likely a doctor will choose asset restructuring instead of insurance; the two are substitute goods.

Thus tort reform, which reduces the price of insurance, reduces this sort of bankruptcy gamesmanship, by making insurance cheaper relative to asset restructuring.

Of course, Florida, as Overlawyered has documented, hardly has meaningful tort reform for doctors.

Like I said, Justinian, think before you post.

Posted by: Ted | August 6, 2008 4:58 PM

Well, Ted, it looks like I've now been the victim of a lost comment. It was a mid-length reply which you know doubt would have characterized as dishonest and an attempt to change the subject.

I will ask this, though: You don't think capping damages at $150k against ER docs and requiring the plaintiff to prove "reckless disregard" is meaningful reform for doctors? Or capping noneconomic damages at $500k, along with contingent fee caps?

Posted by: Justinian Lane | August 6, 2008 7:41 PM

Do you boys need more time to answer the question of why should lawyers and their running dogs on the bench should have any immunity? Immunity attached to the king because he spoke with the voice of God. Is there other justification the victims of these cult criminals should not be allowed any compensation in an airtight rigged, self-dealt system of immunity?

As you may recall, one of the aims of torts is to substitute for violence.

Posted by: Supremacy Claus | August 7, 2008 12:23 AM

The judge is immune from personal liability for his decisions because he is an agent of the sovereign, same as a police officer is immune from personal liability while acting in his official capacity. In the case of the wrongfully convicted rapist I mentioned previously, the sovereign provided compensation to the victim.

I guess I'm not seeing how your solution would solve the problem you believe exists.

Posted by: Steve | August 8, 2008 1:02 PM

Steve: The sovereign had immunity because he spoke with the voice of God. That sole, bottom line justification is not lawful in our secular nation. Immunity violates the Establishment Clause. At the policy level, the judge, police, lawyer make as many harmful mistakes as anyone else. By their salaries, we know their activities are not worth much. So their victims should be compensated. Their mistakes and misconduct need to be deterred as much as anyone else's. Torts not deters misconduct, it deters the entire enterprise. By their immunities, governments have exploded in size and power. Unfortunately, government does nothing well. So the explosion has been one of incompetence. If you want to shrink an entire enterprise, make it liable.

There are many similarities between a lawsuit and a product. Because, the lawsuit harms in its intended use, I would apply strict liability standards to the lawsuit. You will then see a shrinkage in the pestilential activity of the lawyer profession, of government, and of its obstructionist effect on our economy, and safety.

They have taken the power, they need to take the responsibility.

Lastly, immunity is unjust.

Posted by: Supremacy Claus | August 8, 2008 2:59 PM

I am a new physician and newly finishing fellowship in July. I am in the process of finding a job. I like all physicians have been heavily recruited by Florida retiring physicians who need some new blood to come to the region. I have had interviews and offers in Tampa and Miami. Both are beautiful cities. Yet, as a young doctor with the choice to go anywhere it is very hard for me after all this time and invested to make a decisions to move to a state that aims to take physicians to the cleaners. Also innocent physicians can be sued. Anyone can be sued. Statistics say that all doctors will be sued at least once. The question is whether or not you want to be sued in Florida or elsewhere. Should my wife and children be punished for a poor surgical outcome. Many cases a brought to trial because of some surgical complication which is statistically impossible to avoid. Every surgeon is going to get an unintended result most times it's because the probability of success was low but it was the patients only hope. I would just stop taking difficult cases and only take ones that have greater than a 90% chance of success. This is not how I was taught to think in medical school but it is the way Florida is asking us to think. I think that the Florida legislature lacks insight into what is ultimately best for Florida. Having more patient access to doctors (who are willing to do advanced cutting edge techniques) or having more patient access to physician income. The babyboom medical need will hit Florida before most states. Are you ready Florida? Not only are patients getting older but doctors are getting older as well. In a state that already is the oldest state in the nations. Not to mention many are retiring early because they are tired of the litigious environment. So I will likely take my skill elsewhere. I expect to be sued if I do something negligent. Yet an environment that promotes the idea that wealth can be obtained by counsel and client by suing is not the way I ever saw myself practicing medicine. I think Florida is one of the best states in the Union it's just unfortunate that they can't read the tea leaves with it comes to what Florida will need in the next 20 years. Good luck with that.

Posted by: VJ | November 7, 2010 8:15 AM

Classic case of each side only seeing the world through a particular point of view while the "Pro-Business" lobby in Florida wins the day. People who are against "tort reform" (like myself) point out the most egregious cases of victimization by negligent doctors and the unspeakable damage they can cause with the wrongful wielding of the scalpel, while discounting the validity of the frivolous lawsuit. People who are for tort reform can only see the "overly litigious" society in which we live and the myriad (false) claims of excessive frivolous lawsuits filed to force malpractice insurance companies to settle on the cheap rather than go through expensive trials.
Neither side is correct entirely, but I would strongly argue that shielding doctors from liability for negligence, and precluding juries from deciding the truth based on the facts at trial, simply allocates costs onto people least able to afford them: usually the patient who suffered an injury and can no longer earn an income. Furthermore, tort reform doesn't reduce the case load of the court system or reduce the cost of medical practice in the states where it has been enacted. The only people who seem to benefit are med mal insurance companies.

I believe that 99% of doctors are doing their best, that they maintain good practices and stay knowledgeable, capable, and informed. I also believe that juries are a lot better at deciding these sort of cases than people give them credit for doing. I'm also confident that telling someone who has suffered life-debilitating injury at the hand of a physician she trusted with her life that, for POLICY reasons, we've decided that we won't let her recover the actual damages caused by the doctor's misconduct even if a jury hears the facts and decides to grant the award is morally reprehensible and allocates costs to the person least capable of bearing the burden. To me, the side of justice is on allowing a person to make their case to a jury and letting a group of people decide on the merits whether a given doctor's actions were deficient. Florida, more than most states, has enacted numerous laws to shield doctors from liability and raise the evidentiary standard needed to overcome in order to obtain punitive damages against them.

If there is anyone to blame, it is the Florida legislature and the Executive for allowing insurance companies to do what they will in the state. A more robust regulation of that industry would do us all good.

Posted by: JFish | January 24, 2011 3:55 PM