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Bill Bower is the Senior Vice President - Healthcare at Gallagher Bassett Specialty and has over 20 years of industry experience. You can find him on LinkedIn.

In the medical-professional liability arena, we are seeing an escalation in severity/exposure throughout the country. In the last eight (8) years, there have been dozens of medical malpractice verdicts in excess of $20 million. Ever expanding use of life-care plans in the tens of millions of dollars, increasing employment of “Reptile Theory” tactics by the plaintiffs’ bar, and a trend toward rising jury verdicts are changing the landscape of healthcare risk and exposure.

Exposure, in its broadest sense, involves a multitude of objective and subjective factors. Objective factors may include compensatory damages, punitive awards, loss of investors, or a diminution of a company’s stock price. Subjectively, exposure may include a drain on healthcare corporate resources through protracted litigation, unfavorable publicity for physicians and healthcare systems, and/or a negative impact on personal and professional relationships. The impacts of each of these factors may ebb and flow depending upon the nature of a particular case. But, regardless of which elements influence the determination of value, one thing is absolutely essential in assessing the magnitude of the exposure: intellectual honesty.

The Case for Intellectual Honesty

Intellectual honesty enables you to establish what is real vs. what you want to be real. In a litigation scenario, intellectual honesty is the ability to take a clear, dispassionate look at all the factors influencing a case to determine the legitimate value proposition if the matter were tried and lost and the genuine chance of success should the case be taken to trial.

In many instances, defense counsel and claims professionals focus on the defensibility of a case, arguing that a case can be won out of concern for looking weak. This habit of telling the client or senior leadership what they want to hear instead of what they need to know can prove disastrous in the name of saving face when providing thoughtful, impartial analysis could better demonstrate their expertise and value. Intellectual honesty requires that egos are checked at the door, ensuring the evaluation process is done outside the confines of an echo chamber. It compels healthcare organizations to suppress the desire to reflexively defend a claim in order to take the time to explore the facts, determine liability, and calculate probable damages to avoid a potentially cataclysmic result in court.

Intellectual Honesty in Practice

Conducting a thorough assessment of the caliber and credibility of your witnesses and the quality of your evidence can help determine whether a case will fall into the narrow percentage of cases that end up in front of a jury. A case succeeds or fails based on a combination of these two factors. For example, a bad witness has the capacity to completely derail an otherwise open-and-shut claim. Similarly, a lack of evidence, or weak evidence, needs to be recognized and addressed as soon as possible to reduce negative impact.

The first question to ask is can the witness’ presentation be improved? Then, can you mount credible evidence to defend or prosecute the case? If not, part of an intellectually honest evaluation includes acknowledging that your case has weaknesses. If those weaknesses cannot be bolstered, pressing on and ignoring glaring concerns rarely results in a positive outcome.

An intellectually honest evaluation not only provides a genuine understanding of a case, it can guide a more accurate determination of whether or not a case should be tried or resolved and, if the latter, help quantify the true value of the case. Efforts at resolution, short of trial, require a clear understanding of the evidence and how a jury or fact finder may view it. Accurately identifying strengths and weaknesses serves to minimize the chances of being surprised during negotiations and strengthens your organization’s overall mediation position.

5 Steps to Achieve Successful Resolution

Once a thorough and honest evaluation has been made, a successful resolution can be achieved. Consider these five (5) steps to guide your case to an optimal outcome:

1. Plan ahead. First, define your negotiating strategy and your ultimate value proposition. Manage the expectations of your client and all interested parties. Surprises may be fine at birthday parties, but they are unwelcome in litigation. Keep your client engaged and informed throughout the process. If applicable, consider filing dispositive motions or an offer of judgment to create pressure and risk. Further, consider securing a court-appointed guardian ad litem when warranted.
2. Gain and maintain credibility with your opening offer. Don’t get stalled on the demand. An intellectually honest evaluation will provide your value proposition. Stick with it. Have a basis for your opening offer. It is important to develop a game plan and negotiate to your number. Don’t base your offer on what others are doing.
3. Be principled, professional, and reasonable. Make concessions when necessary and maintain your position as a “truth teller.” Failure to do so runs the risk of undermining your credibility with opposing counsel, co-defendants, and the mediator.
4. Attempt to work with, not against, opposing counsel. When the case involves a catastrophic personal injury, consider retention of a structure broker to make offers that will fund life-care plans and future needs.
5. Continually follow up. Most cases don’t resolve with a single phone call, or even a single day of mediation. Be persistent. If your opponent has made a reasonable request for information, provide it. If there is an outstanding question to be answered, answer it. Through your analysis, you’ve determined that the case should be resolved. Don’t let the opportunity disappear to resolve the case at your value.

Recognizing and resolving any case, particularly a catastrophic case, can be challenging. Engaging in an intellectually honest evaluation provides the key components of a proven framework to help leaders at healthcare organizations navigate a pathway toward swift resolution and successful outcomes. 

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