Quality Control,Enterprise Liability,and Disintermediation in Managed Care

Kohn L.T. Corrigan J.M. Donaldson M.S. , eds., Committee on Quality of Health Care in America, Institute of Medicine, To Err Is Human: Building a Safer Health System (Washington, D.C.: National Academy Press, 1999), available at <http://books.nap.edu/books/0309068371/html/R1.html#pagetop> [hereafter cited as IOM Report].

Harvard Medical Practice Study Group, Patients, Doctors, and Lawyers: Medical Injury, Malpractice Litigation, and Patient Compensation in New York (Cambridge, Massachusetts: Harvard University, 1990);.

Weiler P. , Medical Malpractice on Trial (Cambridge, Massachusetts: Harvard University Press, 1991).

IOM Report, supra note 1, at 95–96.

Danzon P. , Medical Malpractice: Theory, Evidence and Public Policy (Cambridge, Massachusetts: Harvard University Press, 1985): at 187–95;.

Weiler P. , A Measure of Malpractice: Medical Injury, Malpractice Litigation, and Patient Compensation (Cambridge, Massachusetts: Harvard University Press, 1993): at 141–42.

Landes W. Posner R. , The Economic Structure of Tort Law (Cambridge, Massachusetts: Harvard University Press, 1987): at 9–14.

The Harvard Medical Practice Study, published in 1990, examined the rate of negligent and non-negligent medical injury and the relationship between the tort system and medical injury in the context of New York hospitals. See Weiler , supra note 4, at viii.

See generally Harvard Medical Practice Study Group, supra note 2;.

Brennan T. ,“Incidence of Adverse Events and Negligence in Hospitalized Patients: Results of the Harvard Medical Practice Study I,” N. Engl. J. Med., 324 (1991): 370–76;.

Leape L. , “The Nature of Adverse Events in Hospitalized Patients: Results of the Harvard Medical Practice Study II,” N. Engl. J. Med., 324 (1991): 377–84. The researchers found that use of the medical malpractice system correlated very poorly with receipt of a negligent medical injury. Most negligently injured patients never filed claims for compensation, and only about half of the patients who did file suffered a negligent injury.

See Weiler , supra note 4, at 69–72.

Weiler , supra note 4, at 139–40.

See Weiler , supra note 2, at 134–39;.

Studdert D. Brennan T. , “No-Fault Compensation for Medical Injuries: Making It Happen,” JAMA, 286 (2001): 217–26.

See Landes Posner , supra note 5, at 57–58;.

Shavell S. , Economic Analysis of Accident Law (Cambridge, Massachusetts: Harvard University Press, 1987): at 8;.

Keeton W.P. , Prosser and Keeton on Torts, 5th ed. (St. Paul, Minnesota: West Publishing, 1984): at 25–26;.

Schwartz G. , “Reality in the Economic Analysis of Tort Law: Does Tort Law Really Deter?,” UCLA Law Review, 42 (1994): 377–444, at 443.

Danzon , supra note 4, at 222.

Id.

Id.; Weiler , supra note 4, at 112.

Shuman D. , “The Psychology of Deterrence in Tort Law,” Kansas Law Review, 42 (1993): 115–68, at 121.

See Landes Posner , supra note 5, at 57–58;.

Shavell , supra note 9, at 8;.

Keeton , supra note 9, at 25–26;.

Schwartz , supra note 9, at 443.

Patricia Danzon, a perceptive critic of the current system, argues that “the malpractice system departs significantly from [the] theoretical ideal [of general deterrence], but the most extreme criticisms are unfounded. Danzon, supra note 4, at 222.

She further argues that the deterrence value of the system justifies its high cost, even taking into account its many flaws, although she strenuously argues for numerous modifications to the current structure of malpractice law. Id. at 226–27.

See Shuman , supra note 13, at 152–53.

See Weiler , supra note 4, at 112.

See Danzon , supra note 4, at 29 (filed claims represent small percentage of negligent injuries);.

Weiler , supra note 2, at 12–13 (same).

See IOM Report, supra note 1, at 36–37 (fear of malpractice liability results in nondisclosure of errors to patients);.

Weiler , supra note 4, at 139–40 (patients resort to initiating litigation in order to obtain information about medical errors);.

Sage W.M. Hastings K.E. Berenson R.A. , “Enterprise Liability for Medical Malpractice and Health Care Quality Improvement,” American Journal of Law & Medicine, 20 (1994):1–28, at 4 (“many physicians and other health care providers are unlikely to admit their negligent behavior to themselves, much less to their patients”).

See Danzon supra note 4, at 197–98;.

Shuman , supra note 13, at 120.

See Shuman , supra note 13, at 123 (arguing that tort decisions reflect uncertainty over the rule of law).

But see Danzon , supra note 4, at 42. Danzon undertook an empirical examination of a large number of litigated malpractice cases in order to examine, among other things, the charge that “decisions by juries and judges typically do not follow the precepts of the law”; “the conclusion of this analysis, based on almost 6,000 claims resolved nationwide in two different time periods, is that the courts are far from arbitrary and the law makes a substantial difference.”

Id.

See Danzon , supra note 4, at 42 (“More than 90 percent of claims are settled out of court.”).

See Weiler , supra note 4, at 131;.

Danzon , supra note 4, at 226.

See also Posner R. , Economic Analysis of the Law, 5th ed. (New York: Aspen Law & Business, 1998): at 222–24 (tort law in general, and medical malpractice law specifically, deters harmful conduct);.

Schwartz , supra note 9, at 443 (tort law provides “something significant” in terms of deterrence).

See generally Calabresi G. , The Cost of Accidents (New Haven: Yale University, 1970);.

Priest G. , “The Invention of Enterprise Liability: A Critical History of the Intellectual Foundations of Modern Tort Law,” Journal of Legal Studies, 14 (1985): 461;.

Rabin R. , “Some Thoughts on the Ideology of Enterprise Liability,” Maryland Law Review, 55 (1996) 1190–209.

See McDonald v. Hampton Training School for Nurses, 486 S.E.2d 299 (Va. 1997).

Gilbert v. Sycamore Municipal Hospital, 622 N.E.2d 788 (Ill. 1993).

Kashishian v. Port, 481 N.W.2d 277 (Wis. 1992).

See also Abraham K. Weiler P. , “Enterprise Medical Liability and the Evolution of the American Health Care System,” Harvard Law Review, 108 (1994), 381–436, at 386–89.

See Darling v. Charleston Community Memorial Hospital, 211 N.E.2d 253 (Ill. 1965), cert. denied, 383 U.S. 946 (1966).

See generally Abraham Weiler , supra note 25, at 388–90.

See Thompson v. Nason Hospital, 591 A.2d 703 (Pa. 1991).

Furrow B. , “Enterprise Liability and Managed Care Reform: Managing Care and Managing Risk,” Saint Louis University Law Review, 39 (1994): 77–132, at 110–11.

The American Law Institute, Reporters' Study: Enterprise Responsibility for Personal Injury, vol. 2, Approaches to Legal and Institutional Change (Philadelphia: American Law Institute, 1991): At 114 [hereafter cited as ALI Study].

Id. at 114–15.

Id. at 114–15.

Professor Paul Weiler was the reporter for the ALI study and he, along with Professor Kenneth Abraham, has written extensively and trenchantly on hospital-based enterprise liability.

See Weiler , supra note 2.

Abraham Weiler , supra note 25;.

Abraham K. Weiler P. , “Enterprise Liability and the Choice of the Responsible Enterprise,” American Journal of Law & Medicine, 20 (1994): 29–39.

The ALI study estimated that its recommended form of enterprise liability (in which the hospital becomes the sole defendant only for “physician malpractice that injures patients who are treated within that hospital”) would apply to “roughly 90 percent of the incidents now giving rise to malpractice claims and payments.” ALI Study, supra note 29, at 114 (footnote omitted).

The study used 1984 data, however the more recent trends move surgery and other major procedures out of hospitals and into outpatient settings. See Sage W. , “Enterprise Liability and the Emerging Managed Health Care System,” Law and Contemporary Problems, 60 (1997): 159–210, at 163.

See Study ALI , supra note 29, at 119;.

Abraham Weiler , supra note 25, at 406.

See Danzon , supra note 4, at 225–26;.

Schwartz , supra note 9, at 401–02.

See Becher E. Chassin M. , “Improving Quality, Minimizing Error: Making It Happen,” Health Affairs, 20, no. 3 (2001):68–81, at 71.

See Dobbs D. , The Law of Torts (St. Paul, Minnesota: West, 2000): at 631 (causation of injury an element of a medical malpractice action);.

Weiler , supra note 4, at 112.

Danzon , supra note 4, at 29;.

Weiler , supra note 2, at 12–13.

See Weiler , supra note 2, at 14.

See Shuman , supra note 13, at 121–23.

See Abraham Weiler , supra note 25, at 408 (“Malpractice liability insurers, not physicians, actually pay the awards to malpractice claimants—thus diluting the direct incentives that physicians might otherwise have to enhance their quality of care in order to avoid paying jury verdicts to injured patients.”).

Danzon , supra note 4, at 86–87 (“In principle, … liability insurance need not interfere with deterrence if insurance premiums adjust to reflect the insured's quality of care. As a theoretical proposition, if the price of insurance coverage accurately reflects the insured's probability of loss — perfect experience rating — insurance does not interfere with incentives for care.”).

See Abraham Weiler , supra note 25, at 409–10;.

Danzon , supra note 4, at 87.

See Danzon , supra note 4, at 87.

Abraham Weiler , supra note 25, at 408.

See Danzon , supra note 4, at 95 (“Although [malpractice insurance] rating structure is extremely rigid, to some extent it reflects the fact that the small pool of policyholders and the instability of loss experience over time preclude drawing finer classifications with actuarial credibility.”);.

Weiler , supra note 2, at 76–79 (discussing barriers to experience rating for physicians' malpractice experience). Abraham and Weiler explain the absence of experience rating in physicians' malpractice insurance in the following terms:.

Abraham K. Weiler P. , supra note 25, at 410 (footnotes omitted).

See Weiler , supra note 2, at 76.

See Abraham Weiler , supra note 25, at 410–11.

Id. at 411.

Physicians' non-economic incentives to avoid malpractice claims, such as the time required to respond to claims and the emotional toll exacted by claims of negligence, ought not be overlooked. See Shuman , supra note 13, at 130–31 (“[I]n the case of malpractice actions against physicians, … the time demands of defending a claim on the physician's practice, the potential impact of the claim on patient demand, and the emotional distress of an unresolved claim are significant uninsurable costs for physicians.”) (footnote omitted). But the malpractice system's attempts to transmit economic signals to minimize error are gravely compromised by the structure of physician liability insurance.

See Abraham Weiler , supra note 25, at 414.

Id. Some physicians' malpractice carriers apparently perform this role to some limited degree.

Id Emerging common law theories of corporate negligence and ostensible agency have moved hospitals in the direction of assuming such a role; a shift to enterprise liability would heighten their interest in such oversight.

Id.

IOM Report, supra note 1, at 4 (“Preventing errors means designing the health system at all levels to make it safer. Building safety into processes of care is a more effective way to reduce errors than blaming individuals. …”).

Id.

Study ALI , supra note 29, at 124.

Id. at 123. Compare the following analysis from the IOM report:.

IOM Report, supra note 1, at 42.

This is not to paper over the glaring difference between the IOM'S approach and that advocated by enterprise liability theorists. The IOM repeatedly cautions against the “blame game,” arguing that “blaming an individual does little to make the system safer and prevent someone else from committing the same error.” Id. at 4.

The IOM does, however, recognize that accountability is appropriate, thereby suggesting at least that compensation is a proper role for a negligence system. Id. (“People must still be vigilant and held responsible for their actions.”). The ALI study, due to its focus on modification of the current tort system, approaches the topic of error reduction from the deterrence perspective.

See ALI Study, supra note 29, at 123.

Id.

See Abraham Weiler , supra note 25, at 416–17.

Id. at 416.

Id. at 396–97.

Id. at 416–17.

See Sage Hastings Berenson , supra note 19, at 2.

Sage Hastings Berenson worked with the “medical malpractice working group of the White House Task Force on Health Care Reform,” among other capacities, in the health reform effort. Id. at 1.

See also Health Security Act, H.R. 3600, 103d Cong., 1st Sess. § 5311 (1993).

See Sage Hastings Berenson , supra note 19, at 1–2 (the authors “agree that accountability in health care must be redefined if true quality is to be achieved,” and therefore advocate a shift to enterprise liability).

See Health Security Act, supra note 61, § 5311 (a) (authorizing the creation of state-based demonstration projects to test “whether substituting liability for medical malpractice on the part of the health plan in which a physician participates for the personal liability of the physician will result in improvements in the quality of care provided under the plan. …”).

See Sage Hastings Berenson , supra note 19, at 2–5.

Bernstein A. , “Trend Data on Medical Encounters: Tracking a Moving Target,” Health Affairs, 20, no. 2 (2001): 58–72, at 65–66.

See also Danzon P. , “Tort Liability: A Minefield for Managed Care?,” Journal of Legal Studies, 26 (1997): 491–519, at 515.

Cal. Bus. & Prof. Code § 2216.2(a) (West 1990 & Supp. 2001), added by Stat. 1999, c. 944, § 3.

See also Kuelthau R. , “Ambulatory Surgery Centers — Medical Clinics and the National Practitioner Data Bank,” Marquette Law Review, 79 (1996): 819–31, at 819 (noting, in the context of mandatory reporting to the National Practitioner Data Bank, the increase in outpatient procedures).

Sage Hastings Berenson , supra note 19, at 11.

Furrow , supra note 28, at 125.

Id.; Havighurst C. , “Vicarious Liability: Relocating Responsibility for the Quality of Medical Care,” American Journal of Law & Medicine, 26, no. 1 (2000): 7–29, at 8.

Sage Hastings Berenson , supra note 19, at 9–10.

Sage Hastings Berenson , supra note 19, at 9.

Id. at 11–12.

Id. at 13–14.

Id. at 14.

See also Furrow , supra note 28, at 99–100 (discussing information systems).

The Clinton plan, after all, included plan-based enterprise liability only on a demonstration basis. See Health Security Act, supra note 61, § 5311(a).

See also Sage Hastings Berenson , supra note 19, at 10–13 (arguments for plan-based enterprise liability couched in conditional terms, assuming the adoption of the other broad reforms proposed in the Health Security Act).

Havighurst , supra note 69, at 10–14 (describing the tendency of MCOs to distance themselves from the delivery of health care and their failure to undertake efforts to encourage their contracting providers to improve the quality of care).

See Sage Hastings Berenson , supra note 19, at 10–15.

Id. at 14.

Id. at 23–24.

See Gable J. , “Ten Ways HMOs Have Changed During the 1990s,” Health Affairs, 16, no. 3 (1997): 134–145, at 136.

Sage W. , “Regulating Through Information Disclosure Laws and American Health Care,” Columbia Law Review, 99 (1999): 1701–829, at 1776.

See Fossett J. Thompson F. , “Back-off not Backlash in Medicaid Managed Care,” Journal of Health Politics, Policy and Law, 24, no. 5 (1999): 1159–72, at 1167.

Berenson R. , “Beyond Competition,” Health Affairs, 16, no. 2 (1997): 171–80, at 172–73.

Danzon , supra note 65, at 515–16.

See Sage , supra note 79, at 1776–77.

Id. at 1777.

See Frankford D. , “Regulating Managed Care: Pulling Tails to Wag the Dogs,” Journal of Health Politics, Policy and Law, 24, no. 5 (1999): 1191–200, at 1198 (“Overall, then, now and in the foreseeable future, the dream of getting plans to compete over quality remains just that, a dream. The dominant form of competition among managed care plans is likely to remain price competition. …”).

U.S. Department of Health and Human Services, Office of Inspector General, Managed Care Organization Nonreporting to the National Practitioner Data Bank: A Signal for Broader Concern, OEI-01-99-00690 (Washington, D.C.: Department of Health and Human Services, May 2001).

Id. at 4.

Id. at 6.

Id. at 6–7.

See Enthoven A. Schauffler H. McMenamin S. , “Consumer Choice and the Managed Care Backlash,” American Journal of Law & Medicine, 27 (2001): 1–15, at 3 (as consumers have perceived reductions in choice as providing little benefit, they have insisted on broader choice).

Hacker J. Marmor T. , “How Not To Think About ‘Managed Care,’” University of Michigan Journal of Law Reform, 32 (1999): 661–84.

Id. at 675–79.

Havighurst , supra note 69, at 10–11 (footnotes omitted). Abraham and Weiler anticipated that plans (“financed-based enterprises”), as opposed to hospitals or other “delivery-based enterprises,” would run into such difficulties if relied upon as agents of quality control in enterprise liability:.

Abraham Weiler , supra note 25, at 418 (footnotes omitted).

See Fronstin P. , “Defined Contribution Health Benefits,” EBRI Issue Brief, no. 231 (March 2001): 1–30, at 3;.

Crutcher C. , “The ‘Tipping Point’ for Employer-Sponsored Health Insurance?,” Health Care Purchaser (April 2001): 1, 3–4, at 1.

See Heffler S. , “Health Spending Growth Up in 1999; Faster Growth Expected in Future,” Health Affairs, 20, no. 2 (2001): 193–203, at 196 (“Insurance premiums grew faster in 1999 (6.5 percent) than in the 1993–1998 period (5.0 percent annual average growth). … We anticipate continued near-term acceleration in health insurance premiums — 9.3 percent in 2000 and 10.5 percent in 2001.”) (footnote omitted).

See Fronstin , supra note 91, at 5–6.

See Jacobi J. , “Medicaid Expansion, Crowd-Out, and Limits of Incremental Expansion,” Saint Louis University Law Journal, 45 (2001): 79–116, at 86.

See Fronstin , supra note 93, at 3–4

Crutcher , supra note 91, at 1.

It may be that employees would have a broader range of choice of health plans under some defined-contribution plans. See Fronstin , supra note 93, at 11–12. Employers may well wish to leave plan selection more clearly to employees in order to avoid the risk of new common law or statutory causes of action for negligence in selection of a health plan.

Id. at 11.

See Fronstin , supra note 93, at 15–17 (“Under an individual market, or non-group market, employees would be responsible for choosing their own health insurance, and could choose any health plan available in the market.”);.

Trude S. Ginsberg P. , Are Defined Contributions a New Direction for Employer-Sponsored Coverage?, Issue Brief No. 32 (Washington, D.C.: Center for Studying Health System Change, October 2000): at 3 (describing plan by which employers would provide vouchers for employees to purchase coverage on the individual insurance market).

See Pauly M. Percy A. , “Cost and Performance: A Comparison of the Individual and Group Health Insurance Markets,” Journal of Health Politics, Policy and Law, 25 (2000): 9–26, at 24 (“individual insurance is expensive for what the buyer gets”);.

Trude Ginsberg , supra note 97, at 3 (citing EBRI data in support of claim that “premiums to purchase comparable insurance on the individual market would cost 32 percent more for employees of companies with more than 1,000 workers, and 24 percent more in medium-size companies”) (footnote omitted);.

Steinhauer J. , “Managing Benefits: Let Workers Do It,” New York Times, December 3, 2000, Money and Business section (“talk to anyone who has bought an individual health insurance policy in the last decade and he or she will tell you that there aren't many affordable offerings out there”).

See Pauly Percy , supra note 98, at 20–21 (describing risk-rating of individual insurance);.

Trude Ginsberg , supra note 97, at 3 (same).

See Defined Contributions: The Search for New Visions, Issue Brief No. 37 (Washington, D.C.: Center for Studying Health System Change, April 2001): at 3–4 (describing Internet company HealthSync's version of a consumer choice plan, where even though individual employees control their own plan choices, “the risk pool from the employer is maintained so that ‘the young subsidize the old and the healthy subsidize the sick, so that the social contract of insurance is maintained’”).

It could be argued that the shift from a regime in which the employer chooses one or a handful of plans for employees to one in which employees have unfettered access (cost aside) to every licensed plan will improve quality by encouraging competition among plans. In light of the well-understood information deficits standing in the way of an individual consumer's informed choice of a plan, advocates of quality improvement have emphasized the role of an informed sponsor in culling plans and organizing competition.

See Enthoven A. , “The History and Principles of Managed Competition,” Health Affairs (Supp. 1993): 24–48, at 30–32 (describing the role of the sponsor in managed competition model).

Without any sponsor to monitor or assist in consumer choice, and with plans clearly competing on the basis of price rather than quality (see Havighurst , supra note 69, at 13), the gains to be expected in quality would be slim to none. The steep price differential between group and individual health insurance is probably sufficiently high to discourage mass movement in this direction, however, and talk of the effects of employee choice on quality is therefore probably academic.

One firm offering Internet-based, patient-directed plans is Lumenos, which bills itself as “the antidote to managed care.” See <http://www.lumenos.com/corporate_info/overview> (last visited October 29, 2001).

Goldsmith J. , “The Internet and Managed Care: A New Wave of Innovation,” Health Affairs, 19, no. 6 (2000): 42–56, at 42.

O'Dell S. Franz M. Kelly P. , The Emerging Health Plan: Consumerized and Digitized (Long Beach, California: First Consulting Group, June 2000): at 1, available at <http://www.doghouse.com/pdfs/Emerging.pdf> (emphasis in original).

See Parente S. , “Beyond the Hype: A Taxonomy of E-Health Business Models,” Health Affairs, 19, no. 6 (2000): 89–102;.

Bates D. Gawande A. , “The Impact of the Internet on Quality Measurement,” Health Affairs, 19, no. 6 (2000): 104–14.

See Lumenos , supra note 102.

HealthMarket, Inc., “Self Directed Health Plans,” at <https://www.healthmarket.com/M/consumers/5027.shtml> (last visited October 29, 2001).

Vivius, Inc., “A Personalized Healthcare System,” at <http://www.vivius.com> (last visited October 29, 2001).

Definity Health, Inc., “Consumer Control,” at <http://www.definityhealth.com/marketing/advantage.html> (last visited October 29, 2001).

MyHealthBank, “Services,” at <http://www.myhealthbank.com/corp/homepage/services.jsp> (last visited October 29, 2001).

See Crutcher , supra note 91, at 3.

Id.

Goldsmith , supra note 103, at 50.

quoting Lathrop J.P. Carlebach D. , “HMOs'R'us: A Prescription for the Future,” Strategy + Business (Fourth Quarter 1998): 16–20.

Medical savings accounts, or MSAs, were created as a demonstration project in 1996 as part of the Health Insurance Portability and Accountability Act, Pub. L. No. 104-191. MSAs permit mid-sized employers to offer a tax-sheltered benefit to employees in the form of funds deposited in a savings account, for use in paying for health care. The employees are required to pay a deductible, and are protected from large expenses by catastrophic insurance coverage after they reach a high attachment point. The funds in their medical savings account, if unspent in the year deposited, roll over from year to year, and may be used by the employee in future years for medical expenses or retirement savings.

See generally Jefferson R. , “Medical Savings Accounts: Windfalls for the Healthy, Wealthy & Wise,” Catholic University Law Review, 48 (1999): 685–726. The number of MSA enrollees is capped at 750,000. Set by the terms of the statute to expire in 2000, the MSA experiment was extended two years, to 2002, and MSAs were renamed “Archer MSAs.” Legislation has been introduced to make MSAs permanendy available to all, a measure that has the support of the Bush administration. See H.R. 1524, 107th Congress, 1st Sess. Disintermediated plans are also akin to flexible spending accounts (FSAs), through which employees may dedicate pre-tax income to payment of medical expenses not covered by health insurance. The accounts are typically administered by a financial agent. Any funds not used in the course of a year are forfeited. See Internal Revenue Code § 105(b).

Crutcher , supra note 91, at 1. (footnotes omitted).

See websites identified in notes 102 and 106.

Id.

Id.

Definity Health, Inc., supra note 106.

Lumenos, Inc., supra note 102.

HealthMarket, Inc., supra note 106.

Vivius, Inc., has a slightly different model. Although members of Vivius may, as with the other disintermediated plans, choose their own provider and health care, they do not pay on a fee-for-service basis. As one commentator explains:.

Goldsmith , supra note 103, at 50.

See Vivius, Inc., supra note 106.

Fronstin , supra note 93, at 6.

Id.

See generally Jefferson , supra note 110;.

Scandlen G. , “Reply: MSAs Can Be a Windfall for the Rest of Us Too,” Catholic University Law Review, 49 (2000): 679–95.

See also Thorpe K. , “Managed Care as Victim or Villain?,” Journal of Health Politics, Policy and Law, 24 (1999) 949–56, at 954 (describing the costs and benefits of medical savings accounts).

See, e.g., Gomez P.A. , “Promises and Pitfalls: An Analysis of the Shifting Constitutional Interests Involved in the Context of Demanding a Right to Treatment in Health Care,” Albany Law Review, 64 (2000): 361–396, at 385–86.

See “Investment Banker Predicts New Era of ‘Virtual Hospitals,’” California Health Law Monitor, 6, no. 8 (April 20, 1998) (even in 1998, there were predictions that HMOs would be “disintermediated” and bypassed by networks being formed around hospitals and physicians).

See Havighurst , supra note 69.

See Studdert Brennan , supra note 8.

See Becher Chassin , supra note 35, at 68–71.

IOM Report, supra note 1, at 3.

See also Reason J. , “Human Error: Models and Management,” British Medical Journal, 320 (2000): 768–70;.

Leape L. , “Promoting Patient Safety by Preventing Medical Error,” JAMA, 280 (1998): 1444–47;.

Reason J. , Human Error (Cambridge, England: Cambridge University, 1990).

Becher Chassin , supra note 35, at 69.

Id. at 71.

Abraham Weiler , supra note 25, at 418.

See Danzon , supra note 4, at 95;.

Weiler , supra note 2, at 76–79.

IOM Report, supra note 1, at 4.

See Leape , supra note 126, at 1445.

Reason , “Human Error: Models and Management,” supra note 126, at 768.

See IOM Report, supra note 1, at 31.

Id. at 34.

See Bradley E. , “A Qualitative Study of Increasing b-Blocker Use After Myocardial Infarction,” JAMA, 285 (2001): 2604–11. Similarly, anesthesia errors often can be traced to a slip or lapse by a human, but systemic review can “prescribe new procedures and technologies” capable of screening for human error.

See Abraham Weiler , supra note 25, at 411–12;.

Raschke R. , “A Computer Alert System to Prevent Injury from Adverse Drug Events,” JAMA, 280 (1998): 1317–20 (drug errors).

IOM Report, supra note 1, at 51.

Studdert Brennan , supra note 8, at 217.

IOM Report, supra note 1, at 4.

Id. at 18.

Id. at 95–96.

Sage Hastings Berenson , supra note 19, at 13.

Id. at 14.

Abraham Weiler , supra note 25, at 410–11.

Rabin , supra note 24, at 1198;.

Sykes A. , “The Economics of Vicarious Liability,” Yale Law Journal, 93 (1984): 1231–80, at 1261.

See ALI Study, supra note 29, at 124.

Sage , supra note 32, at 164–65.

IOM Report, supra note 1, at 3.

Bradley , supra note 134, at 2609.

See Danzon , supra note 65, at 515–16;.

Abraham Weiler , supra note 31, at 33–34.

See Sage W. , “Principles, Pragmatism, and Medical Injury,” JAMA, 286 (2001): 226–28, 227.

Havighurst , supra note 69, at 10.

Dobbs , supra note 36, at 977–81.

See Tarasoff v. Regents of the University of California, 551 P.2d 334 (Cal. 1976);.

Rabin , supra note 24, at 1199–200.

See Davis v. Nevada National Bank, 737 P.2d 503 (Nev. 1987).

Connorv. Great Western Savings & Loan Association, 447 P.2d 609 (Cal. 1968).

See Sykes , supra note 143, at 1273–75.

IOM Report, supra note 1, at 60.

The Clinton administration added funding and reorganized a center in the Agency for Healthcare Research and Quality, naming it the Center for Quality Improvement and Patient Safety. See “Clinton-Gore Administration Announces New Actions to Improve Patient Safety and Assure Health Care Quality” (February 19, 2000), at <http://www.ahcpr.gov/wh21900.htm>.

The Bush administration created an interagency Patient Safety Task Force, avowedly for the purpose of pursuing the IOM's error-reduction agenda and specifically to pursue the IOM's goal of “reducing the number of medial errors by 50 percent over 5 years.” See Agency for Healthcare Research and Quality, “Patient Safety Task Force: Fact Sheet” (April 2001), at <http://www.ahcpr.gov/qual/taskforce/psfactst.htm>.

IOM Report, supra note 1, at 157–70.

See Bradley , supra note 134;.

Leape L. , “Systems Analysis of Adverse Drug Events,” JAMA, 274 (1995): 35–43;.

Raschke R. , supra note 134.

Abraham Weiler , supra note 25, at 411–14.

See Becher E. Chassin M. , “Improving the Quality of Health Care: Who Will Lead?,” Health Affairs, 20, no. 5 (2001): 164–79.

IOM Report, supra note 1, at 67.

For example, punitive damages would seem unavailable if the managed care organization took reasonable steps to encourage safety. This assumes, of course, that the enterprise liability system would include a punitive damages feature.

See e.g., OIG Compliance Program for Individual and Small Group Physician Practices, 65 Fed. Reg. 59,434 (October 5, 2000).

OIG Compliance Program for Nursing Facilities, 65 Fed. Reg. 14,289 (March 16, 2000).

OIG Compliance Program for Hospices, 64 Fed. Reg. 54,031 (October 5, 1999).

OIG Compliance Program Guidance for Hospitals, 63 Fed. Reg. 8,987 (February 23, 1998).

McGlynn E. Brook R. , “Keeping Quality on the Policy Agenda,” Health Affairs, 20, no. 3 (2001): 82–90, at 82.

Committee on Quality of Health Care in America, Institute of Medicine, Crossing the Quality Chasm: A New Health System for the 21st Century (Washington, D.C.: National Academy Press, 2001): at iii.