By Christopher Guadagnino, Ph.D.

Published October 2002

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Despite the enactment this March of a slate of tort reforms in Act 13, physicians in Pa. are not content.

Many are finding access to affordable professional liability insurance hard to come by, as premiums continue to spiral upward and major carriers have left the state, stopped writing new policies or significantly restricted the type of policies they will write.

Physician reimbursement from private commercial insurers continues to be held down by companies that dominate their respective markets, with single Blues companies holding a 76 percent market share last year in southeastern Pa., a 65 percent market share in western Pa., a 53 percent market share in central Pa. and a 63 percent market share in northeastern Pa.—according to Pennsylvania Medical Society data. Physicians continue to feel the double-sting of Medicare reimbursement cuts and private insurers who pay less than Medicare, sometimes by a significant margin.

For good measure, a physician practice may have to spend as much as tens of thousands of dollars to meet new privacy rule standards for electronic claims submissions and claims payments set by the Health Insurance Portability and Accountability Act of 1996 (HIPAA), the first compliance deadline of which is this Oct. 16, or this date next year if a compliance plan is filed with the federal government.

This triple-whammy would indicate that there is more reason than ever for physicians to seek recourse through active involvement in the political process. On the heels of successfully helping to elect J. Michael Eakin to the Pa. Supreme Court last year, physicians across the state are actively trying to influence state and federal elections this Nov. 5. Some physicians are running for office themselves. Some have organized large numbers of physicians into a support base for specific candidates. Some have formed PACs and hired professional lobbying firms. Even physicians’ spouses have formed organized campaign networks for their chosen candidates.

Through organized communication networks with their colleagues, fund-raisers and financial contributions, and direct communication with their patients about candidates in the upcoming elections, physicians are no longer taking a back seat to their opponents in making their political clout known.

The Pennsylvania Medical Society’s political action committee (PaMPAC), the traditional source of political support from the physician community, continues to contribute to the campaigns of various candidates for U.S. Congress and for the Pa. General Assembly, as well as supply informational support to help grassroots fundraising efforts around the state for various candidates, says its Executive Director David Thompson.

The Hospital & Healthsystem Association of Pennsylvania, through its HAPAC, is similarly contributing financial support to various campaigns and educating its member institutions about candidates’ positions on issues such as liability reform, hospital reimbursement and health care workforce shortages, says Julie Kissinger, HAP’s director of political development.

Gubernatorial Race

Both PaMPAC and HAPAC say they would feel comfortable working with either Ed Rendell or Mike Fisher as governor. After having interviewed both candidates, PaMPAC’s formal position is that there is no significant difference between them on issues that are important to physicians, and it encourages physicians to support whichever candidate suits them as a Pa. citizen, according to Martin Trichtinger, M.D., PaMPAC’s vice-chair and a member of its executive board representing southeastern Pa.

The two candidates have strengths in different areas, according to Trichtinger: Rendell supports fairer reimbursement to physicians, is sympathetic to physicians on the issue of insurer dominance and has said he would appoint an Insurance Commissioner who would take physicians’ concerns seriously. Fisher has taken no action as attorney general to suggest that he is sympathetic to concerns about Blues’ dominance and has not weighed in on the question of a possible merger between Highmark and Independence Blue Cross, although he has recently criticized their reserves and is now talking about getting a more equitable balance of insurer reimbursement and reserves, Trichtinger adds.

Fisher has been a long-time supporter of tort reform, says Trichtinger, while Rendell has said he would not support a cap on noneconomic (pain and suffering) damages, such as the one proposed at the federal level in a bill by U.S. Rep. Jim Greenwood, which would cap noneconomic damages at the lower of twice the amount of economic damages or $250,000. The bill recently passed in the U.S. House.

The Philadelphia County Medical Society (PCMS) believes that Fisher’s positions on tort reform, including being open to the idea of caps on noneconomic damages, are more likely to provide needed remedies to physicians—including stemming the flow of physicians out of the state—than Rendell’s concerns over low physician reimbursement, says PCMS President Stephen L. Schwartz, M.D. The PCMS, although prohibited by election laws from campaigning for a candidate, is not proscribed from sending a letter to its members indicating that its Board unanimously supports Fisher, and has sent such a letter, says Schwartz.

The Politically Active Physicians Association (PAPA) is also supporting Fisher, impressed that the candidate himself attended a conference on malpractice liability reform held by the group in late August at Drexel University, while Rendell sent a representative, says Anthony DeMarco, D.O., PAPA’s vice president. Formed in July, PAPA wants to get involved in lobbying and elections and believes that medical societies are not adequately focusing on politics, says DeMarco.

As of mid-Sept., the group had 328 members primarily from southeastern Pa.—90 percent physicians and 10 percent podiatrists and dentists—who have agreed to put photos of favored candidates in their waiting rooms, says DeMarco, along with brochures about PAPA and its tort reform agenda, which calls for a specialized court to manage malpractice claims, a malpractice review panel with three regional districts in the state, and a $500,000 limit on noneconomic damages.

PAPA also hopes to see its members wearing their white coats while stationed at the polls on election day, and intends to hold more political rallies, lobby lawmakers and try to get its tort reform agenda in bill form by early Dec., says DeMarco.

U.S. Congressional Races

PaMPAC has contributed funding to the campaign of Melissa Brown, M.D., who is running against U.S. Rep. Joseph Hoeffel (D-13th District) in southeastern Pa. Based on PaMPAC’s analysis of the candidates, says Trichtinger, three issues recommend Brown over Hoeffel. While Brown supports caps on noneconomic damages, Hoeffel does not. Brown said she would put pressure at the federal level calling for an investigation by the appropriate regulators into market shares of Independence Blue Cross and Highmark Blue Cross Blue Shield to block a possible merger between the two companies; Hoeffel said he wouldn’t get involved, according to Trichtinger. Brown would introduce a bill to authorize a re-calculation by the Centers for Medicare & Medicaid Services (CMS) of the reimbursement formula for Medicare managed care, which Trichtinger says had previously underestimated the utilization of the program and continues to result in massive under-reimbursement to physicians, while Congress is poised to reduce it further. According to Trichtinger, Hoeffel said he was supportive of the concept of correcting the Medicare formula but voted against a recent bill mandating that CMS do the recalculation, maintaining that it was up to CMS to correct the formula without a mandate.

Both the PCMS and the Montgomery County Medical Society mailed a letter asking its members to support Brown for Congress, while PAPA is also supporting her through its membership.

While Hoeffel’s campaign did not respond to a request to be interviewed, Trichtinger acknowledges that Hoeffel has been supportive of legislation that would allow private physicians to negotiate jointly in groups with health plans, and he has supported a patient bill of rights. HAP has not gotten into the fray of the Brown-Hoeffel race, says Kissinger, but sees Hoeffel as a friend to the hospital agenda, having voted in favor of hospital reimbursement relief legislation. HAP was scheduled to meet with both candidates in late Sept. for an informational session.

In another U.S. Congressional race, a group of physicians in the Allentown region is supporting Rep. Patrick Toomey (R-15th District), who is running against Edward O’Brien. Robert Murphy, M.D., a plastic surgeon in Allentown, sent personal invitations to a private fund-raiser he organized for Toomey using the membership list of the Lehigh County Medical Society, of which he is president-elect and legislative chair. Some 35 physicians attended. According to Murphy, Toomey supports the Greenwood malpractice reform bill; has sponsored legislation to reduce HIPAA penalties, paperwork and regulatory burdens; and opposed a version of a patient bill of rights that would have expanded tort actions against HMOs and potentially aggravated the problem of insurers’ high costs and low reimbursements.

Although supporting Toomey’s campaign financially, Murphy believes that physicians should maintain a clearly separate professional relationship with their patients, and he is not suggesting that physicians put campaign literature in their waiting rooms.

O’Brien’s campaign did not respond to an interview request in time for this story.

Brian Boyle, M.D., a physical medicine and rehabilitation specialist from Greensburg, as well as outspoken member of the Westmoreland County Medical Society and editor of its Bulletin, is running against Rep. Thomas Tangretti (D-57th District). Because of the nature of his specialty, Boyle says he is concerned that medical liability costs will drive orthopedic surgeons from the region, curtailing his referral base.

Although he did not respond to an interview request for this story, many physicians know of Tangretti by a bill he has introduced recently that would permit the MCARE Fund (formerly the CAT Fund) to operate as a full liability insurance company offering primary levels up to the full limits of state-mandated coverage, which he has argued can drive down premiums by taking insurance out of the profit-loss cycle of the open market and eliminating the costs of marketing and overhead, such as payments to investors and brokers.

Boyle believes that Tangretti’s savings estimates are not based on actuarial studies and that the plan, though enticing, is unrealistic. The root cause of the problem—liability law—must be targeted, says Boyle, who supports further reduction of attorney fees, with higher awards allotting lower percentages to an attorney; reduction of state-mandated liability coverage for physicians to make them less attractive to sue; and a law to trigger action on the part of the Pa. Insurance Dept.—as Pa. Commonwealth Court has directed—to examine whether the creation of Highmark six years ago constitutes a monopoly and whether the company is misusing its reserves to produce undue profits.

The Westmoreland County Medical Society has sent letters to its 355 members asking them to support Boyle’s candidacy. Physicians are also discussing Boyle’s candidacy during medical staff meetings at area hospitals. Boyle hopes to receive financial support from PaMPAC before the election and has already gotten informational support from them regarding campaign strategy and logistics. Boyle says he has tried to stay away from the perception that he is "a hack from a PAC," but adds, "In the final analysis, my job is to see this thing through to a successful end and I may be willing to suffer the arrows of outrageous insult. If I get the point where my opponent needs to attack me on who’s giving to me, that means I’m getting close."

A bipartisan group of 150 physicians, primarily from Delaware County, is involved in a campaign to unseat Rep. Thomas Gannon (R-161st District) and elect Sara Petrosky, a Nether Providence Township Commissioner and attorney who defends physicians and hospitals in malpractice cases. Gary D. Wendell, M.D., chairman of Physicians for Petrosky, says that Petrosky has been outspoken about the need for more aggressive tort reform, while Gannon has been unsympathetic to the liability plight of physicians and has vigorously opposed tort reform legislation. At a discussion about Act 13 in front of a crowd of physicians, when asked what he would do about frivolous lawsuits, Gannon’s comment was, "I don’t know what frivolous means," according to Martin J. Bergman, M.D., a rheumatologist at Taylor Hospital and member of Physicians for Petrosky. "It’s our hope to show him that we do know what it means," adds Bergman.

According to Wendell, members of Physicians for Petrosky have donated money to the candidate, are making phone calls to colleagues to urge them to support her, have agreed to have their name appear on campaign literature, and are putting a pro-Petrosky brochure in their waiting rooms titled, "Why Are Doctors Leaving Delaware County?" The group also plans to distribute to its members buttons that read, "My Rx for Pennsylvania: Sara Petrosky," while some members will be at the polls on election day in their white coats, Wendell adds.

"We’re sending a message that physicians are a force to be reckoned with. We are no longer a group of people who are going to just sit down and ignore the political process," says Bergman, who hopes the message will also serve as a warning to Republican candidates who may have taken for granted that physician support was locked in.

"Physicians historically have not participated in politics. We’ve had protests, we’ve gone to Harrisburg, we’ve had marches. But when it comes to getting involved directly in the political process—sponsoring campaigns aggressively, financing campaigns—physicians are way behind the trial bar and most other organizations," he notes. "If we decide that we are going to use our waiting rooms as a bully pulpit, we can have major influence on people’s thoughts, and hopefully on their voting patterns," Bergman adds, noting that even the least busy physician probably sees a minimum of 50 patients a week, while busier practices can see 200 to 300 a week. Bergman says he would not initiate political discussions in the medical exam room, but would be happy to express his opinions if a patient wanted to talk about particular candidates.

Gannon did not respond to a request to be interviewed for this story. At press time, PaMPAC had not taken a stance on the Petrosky-Gannon race because its board felt strongly that grassroots efforts by local physicians to support Petrosky would be a more effective force, says Thompson. PaMPAC also wanted to see how well Petrosky would do against a very strong incumbent like Gannon, says Trichtinger, who notes that the race is tightening and the issue—as of mid-Sept.—remains open for PaMPAC.

HAPAC has other election priorities and is not focusing on the Petrosky-Gannon race, says Kissinger.

PaMPAC has contributed funding to the campaign of Sen. Robert Tomlinson (R-6th District), and has spearheaded the organization of Physicians for Tomlinson, a bipartisan group of 140 physicians primarily from Bucks County, says Marilyn Heine, M.D., the group’s chair and an emergency physician at Lower Bucks Hospital. PaMPAC helped organize the production of the group’s letterhead, brochures and mailing list, while the group’s members have made financial contributions to the candidate, are committed to talking to colleagues about him, and are using the "power of the waiting room" to educate patients about the issues at stake, says Heine.

According to Heine, Tomlinson has a proven track record of support for tort reform: he is supportive of caps on noneconomic damages, is an advocate of provisions to end "venue shopping" that has led to enhanced jury awards in the Philadelphia area, was an original composer of legislation addressing frivolous lawsuits, and was one of six senators who stood up to Senate leadership and insisted on a stronger version of the medical liability legislation that passed last spring.

Tomlinson’s opponent, former Bucks County Congressman Peter Kostmayer, says he believes that physicians’ medical liability premiums have to be cut in half within a year and is aware of physician discontent in Act 13 as a solution. He supports an end to jury shopping, amended rules of evidence to allow judges to more easily throw out frivolous lawsuits and better consumer information about physicians.

Kostmayer does not believe that a state constitutional amendment to cap noneconomic damages is politically realistic in Pa., given that both houses of the General Assembly would need to pass the amendment in two consecutive sessions, then get voters to pass the amendment on a ballot in two elections. Instead, he advocates bringing physicians, lawyers and the insurance industry to the table to forge a working partnership to address the problem.

John Missanelli, D.O., a Bucks Co. ob/gyn who had to give up obstetrics and open an office in New Jersey because his overhead exceeded his income, is supporting Kostmayer because he believes that what present politicians have enacted is impotent and that a new approach is needed: a more tenacious attack against insurance companies. Collaboration between the physician and legal communities to focus on the problem of low physician reimbursement, he believes, is a more viable way to discourage physicians from leaving the state. Missanelli is working with some family physicians and lawyers in Bristol, Pa. to explore the possibility of bringing civil lawsuits against insurance companies to recoup reimbursement lost to claim denials, bundling and downcoding.

In addition to running for office themselves and organizing in large numbers to form grassroots support networks for candidates, physicians are also forming political action committees and hiring professional lobbying firms to try to influence elections.

Physicians for Quality Care, formed 1 1/2 years ago by the presidents of medical staffs from hospitals including Frankford, Einstein, Jefferson University and Main Line Health’s three institutions, is a PAC which now also represents physicians at Doylestown, Temple, Brandywine and several Delaware Co. hospitals, covering some 4,000 to 5,000 physicians at those institutions, according to Stephen Schachman, managing director of Public Affairs Management, a lobbying firm advising the group.

The group was involved in the campaign last year that succeeded in electing Mike Eakin to the Pa. Supreme Court and is supporting legislative candidates who pass a litmus test of physicians’ tort reform and reimbursement issues—including ending venue shopping, lowering liability costs, questioning state-mandated coverage minimums, capping noneconomic damages and investigating health insurer reimbursement methodologies, says Schachman.

As a PAC, the group is endorsing Montgomery County Sen. Wallis Brooks (R-149th District) because of her support of these issues and has contributed to her campaign. The group is similarly supporting Brown, Tomlinson and Petrosky, Schachman notes. Funded by physician contributions, the group also hopes by early Oct. to distribute printed materials for physician offices endorsing particular candidates, as well as a palm card to take into the voting booth, Schachman adds, noting, "We’re working on a simple theory that doctors see more patients than lawyers see clients."

Running against Brooks is Daylin Leach, a Norristown attorney who says that Physicians for Quality Care never contacted him about his views and believes that its support of Brooks is a partisan endorsement. Leach believes that it is "overwhelmingly likely"that Pa. is going to have a Democratic governor next year and that, in order for bills to transcend the stigma of partisanship and ultimately be signed into law, it is necessary to elect physician-friendly Democrats to the Legislature who believe that relief from the medical liability crisis is important.

Leach proposes to eliminate the incentive for jury shopping in malpractice cases by creating a medical malpractice claims court for which jurors would be selected from one of a few broad geographic regions statewide. To curtail frivolous lawsuits and potentially reduce the number of physicians named in a suit, Leach says he would introduce legislation to allow specific allegations of negligence based on new science to be introduced early in a case so that the court could determine its validity, even before discovery. He would support legislation that would prohibit a medical liability insurer from dropping coverage of physicians who have never been found negligent.

Leach says he needs more information about proposed caps on noneconomic damages, but does not oppose them in concept. He believes that a $250,000 cap would reduce the number of malpractice cases filed, but might thereby effectively deny access to the courtroom of some patients as attorneys decline to take contingency fee cases. Any cap, Leach says, should be high enough to be reasonable, but low enough to lower malpractice costs, and he believes that a sound actuarial analysis is needed to arrive at that number.

Physician spouses are also organizing support for candidates in next month’s election. Donna Rovito, legislation chair of the Pennsylvania Medical Society Alliance, PaMPAC board member and wife of a general surgeon at Lehigh Valley Hospital in Allentown, privately paid for and hosted fund-raisers at her home for Sen. Charles Dent (R-16th District) and Mike Fisher, according to Rovito. PaMPAC has also contributed to Dent’s campaign, she says.

Dent has voted with physicians every time on tort reform issues, while his challenger, Richard Orloski, is a medical malpractice plaintiff’s attorney, says Rovito. Dent voted for Act 13, but publicly declared that it was only a first step and that it was unrealistic to think that it will fix the state’s medical liability problem, Rovito notes.

Orloski did not respond to a request to be interviewed for this story.

Rovito is also organizing a campaign to send letters supporting Sen. Lisa Boscola (D-18th District) to over 200 physicians in Lehigh, Northampton and Monroe counties, indicating that Boscola has voted with physicians on every tort reform bill. Boscola is publicly outspoken about demanding accountability from private health insurers and from the state Insurance Dept., says Rovito and, although Boscola has no official stated position of noneconomic damage caps, she does not rule them out as part of a group of solutions. PaMPAC has also voted to contribute to Boscola’s campaign.

Members of the Lehigh County Medical Society Alliance also attended a golf tournament this summer at which Rovito says they played badly but raised money for Boscola.

Boscola’s challenger, Nicholas Sabatine, an attorney in Northampton Co. and member of the County Council, says that he did support the elimination of joint and several liability, that he understands that venue shopping occurs and would take a look at what could be done to prevent it, and that he would like plaintiff attorneys to pay defense fees if a case is found to be frivolous. He is not familiar with the tort reform issues or specifics of Act 13, but says he would like to see physicians with good claim histories receive further discounts on their malpractice insurance premiums.

Sabatine supports caps on punitive damages, but not on noneconomic damages, maintaining that the system already has safeguards in place, i.e., judges who can and do reduce awards.

Sabatine supports pre-trial review of malpractice cases, according to Evan Reese, M.D., an orthopedic surgeon in Easton and Sabatine supporter, adding that neither candidate can fix the tort reform problem. Reese believes that Sabatine is more knowledgeable than Boscola about property taxes, the issue that is guiding Reese’s vote.

Friends of Dan Naylor is a group of physicians privately organized by Ken Rudolph, M.D., who is president of the Lackawanna County Medical Society and was actively involved in privately campaigning for Mike Eakin last year—an effort he says garnered 10 percent of Eakin’s vote total. Daniel Naylor is trying to unseat Rep. Jim Wansacz (D-114th District) and, according to Rudolph, is concerned about rural health care reimbursement being low and supports stronger tort reform legislation such as malpractice insurance reform to entice new companies to enter the state, caps on noneconomic damages and limits on frivolous lawsuits.

Rudolph says he has collected contributions for Naylor’s campaign from some 100 physicians so far and is encouraging the candidate to send a letter to physicians in Lackawanna Co. indicating his stand on issues and asking them to speak with their patients and medical staff colleagues about these issues, as they did during the Eakin campaign. Rudolph says that PaMPAC is not supporting Naylor for fear of antagonizing an incumbent who might get reelected, but may reconsider if the race tightens.

Wansacz says he supported tort reform provisions of HB 1802, which became part of Act 13, and he believes that organized physician support for his opponent is partisan politics. He says he voted for legislation to reduce frivolous lawsuits, to strengthen expert witness rules and to roll back private malpractice insurance rates by 20 percent, while he also supports preventing venue shopping.

An effort to cap noneconomic damages, however, would entail a two-year ballot process and would not provide immediate financial relief that Wansacz says he supports and physicians need. Instead, Wansacz says he is meeting with physicians and hospitals to come up with solutions that will provide an immediate fix. Wansacz notes that most proposed solutions leave out malpractice insurers, which he says are part of the problem, and he is looking at the Tangretti bill and other options that might make physicians’ liability insurance more affordable.

Stephen Vale, M.D., an ophthalmologist in Carbondale and co-chair of the Maimonides Society in northeastern Pa., says that Wansacz has actively sought physician input and has voted with physicians on tort reform legislation. Vale plans to discuss his support of Wansacz to some 50 physicians expected to attend the society’s meeting in mid-Oct., as well as put a Wansacz poster in his office and tell patients who ask that Wansacz is pro-physician. Ironically, redistricting will prevent Vale himself from voting for Wansacz because he lives in South Abington Township, which is no longer in Wansacz’s district.