Should we try Kiwi model on no-fault medical error?

by Colleen Flood and Lorian Hardcastle

This commentary was first published in the Toronto Star on October 16, 2006.

Courtesy of the U.S. media, we hear many horror stories about medical malpractice doctors ordering unneeded tests and procedures, astronomical jury awards, and doctors in high-risk specialties unable to pay insurance premiums.

In Canada, the situation has not reached that point. But there are many concerns with the tort system, the cost and length of litigation, doctors keeping mistakes secret in fear of liability, and the "forensic lottery" of malpractice litigation that may punish the innocent and ignore the wrongdoer.

We now have a much better understanding of how risky it is for patients in a health-care system and the high number of mistakes that occur ó errors that often cannot be attributed to one person but the system as a whole.

The renewed emphasis on a safety movement is at odds with the individualized nature of litigation.

In a successful malpractice case, one patient may succeed but this does not seem to do much for the overall safety of the system. These problems have led to talk of tort reform, including New Zealand's no-fault scheme.

In New Zealand, you can't sue for personal injury including injury as a result of negligence on the part of a doctor, hospital, nurse, etc.

A person injured by medical error receives some income compensation and rehabilitative services including treatments in private hospitals and clinics, home care, prescription drugs, physiotherapy, all things not covered by New Zealand's equivalent of medicare.

The good news for both injured patients and their doctors is that patients don't have to prove negligence on the part of their doctors.

The Kiwi no-fault system has many appeals. Many more patients will receive some assistance after injury including income supports and coverage for rehabilitation services right when they need them most.

Claims are processed within an average of 15 days as opposed to five years or more in the tort system.

In addition, the claims process is user-friendly ó you can easily make your claim without a lawyer ó as opposed to the cost and complexity of litigation. New Zealand's scheme seems manageable in terms of total cost; it covers 4 million people for less than $30 million per year or just over $7 per person, per year.

Advocates of no-fault also argue that it is an important first step in improving the overall safety of the health-care system and creating a culture where doctors and other medical professionals are not afraid to admit where they have made mistakes.

This would be the decisive argument for no-fault but the research evidence (namely, whether it's safer in the New Zealand health-care system because of no-fault) has yet to be proven.

On the other hand, one of the classic arguments in favour of tort law is that of deterrence.

For example, doctors will be less likely to commit errors with the prospect of a lawsuit hanging over their head.

There is no evidence at all from New Zealand that there are higher rates of error because patients can't sue. Although there are many benefits to the Kiwi model, there are concerns.

The compensation that individual patients receive even for catastrophic injuries is modest and over time, the benefits have diminished. For example, patients used to receive a lump sum for loss of a limb, now there are no lump sum payments. Moreover, injured patients not receiving income at the time of their injury, such as stay-at-home-moms or seniors, do not receive earnings-related compensation.

There are also criticisms with the scope of the scheme, with treatment injuries receiving compensation, while those suffering from illnesses receive no monetary benefits.

Another concern relates to the realization of patient safety improvements. With physicians so accustomed to practising within a fault-based system, a cultural shift to openness about medical errors may take some time.

Although New Zealand has a no-fault system, there is still anecdotal evidence that doctors are reluctant to admit mistakes. This may result from fear of professional discipline or concern with reputation.

There are also issues specific to the Canadian context.

As opposed to New Zealand, which has more broadly embraced no-fault accident compensation, restricting the reforms to medical error may make the realization of widespread cultural change difficult.

Furthermore, this would result in an anomalous situation where persons injured by doctors would be eligible for no-fault compensation, while persons injured by other professionals such as engineers would sue in tort.

Also, some of what the New Zealand's scheme covers, for example, first dollar coverage of primary care or access to private clinics to avoid long waiting times, is either already covered by Canadian medicare or at odds with Canadian values in medicare.

The relevant question is whether, on balance, the Kiwi system is better than the present tort system for medical error in Canada.

There are so many problems with the tort system for medical error that one is tempted to say that anything must be better. The real question, in our view, is whether a no-fault system will make the system safer or of higher quality.

On this one, there is no definite evidence as New Zealand has only in the last few years truly made the system no-fault for medical error.

We should closely watch the results coming out from the Kiwi experience. In the meantime, it's the kind of initiative we should try out in a limited fashion and see how it works in a Canadian context.

For example, we should think about no-fault for primary care teams when we want teams of doctors, nurses, and pharmacists to work together without fighting over liability.

So should we embrace no-fault? On balance, the pluses seem to be increasingly outweighing the minuses. Any takers among the Liberal leadership candidates?