MINUTES OF THE

SENATE Committee on Judiciary

 

Seventy-second Session

March 13, 2003

 

 

The Senate Committee on Judiciary was called to order by Chairman Mark E. Amodei, at 8:00 a.m., on Thursday, March 13, 2003, in Room 4100 of the Legislative Building, Carson City, Nevada. Exhibit A is the Agenda. Exhibit B is the Attendance Roster. All exhibits are available and on file at the Research Library of the Legislative Counsel Bureau.

 

COMMITTEE MEMBERS PRESENT:

 

Senator Mark E. Amodei, Chairman

Senator Maurice E. Washington, Vice Chairman

Senator Terry Care

Senator Mike McGinness

Senator Dennis Nolan

Senator Dina Titus

Senator Valerie Wiener

 

STAFF MEMBERS PRESENT:

 

Nicolas Anthony, Committee Policy Analyst

Bradley Wilkinson, Committee Counsel

Jo Greenslate, Committee Secretary

 

OTHERS PRESENT:

 

John L. Wagner, Lobbyist, Nevada Republican Assembly

David Horton, Lobbyist, Committee to Restore the Constitution

Ivan R. “Renny” Ashleman, Lobbyist, Nevada Health Care Association

Charles C. Perry, Lobbyist, Nevada Health Care Association

Bobbie Gang, Lobbyist, Nevada Women’s Lobby and National Association of Social Workers – Nevada

Rudy Manthei, D.O., Lobbyist, Keep Our Doctors In Nevada

Bill Bradley, Lobbyist, Nevada Trial Lawyers Association

Kerry Earley, Attorney, Keep Our Doctors In Nevada

 

Chairman Amodei:

We will open the hearing on Senate Bill (S.B.) 97.

 

SENATE BILL 97:  Makes various changes relating to certain actions against providers of health care. (BDR 1-248)

 

John L. Wagner, Lobbyist, Nevada Republican Assembly:

I represent a volunteer group known as Nevada Republican Assembly, not to be confused with the Assembly that meets downstairs. I have mixed emotions on S.B. 97. I did sign in as for the bill, but as a senior citizen, my position is at the bottom of the food chain. Every year I get a raise in my social security benefit, but every year, Medicare Part B goes up. To make it worse, the supplemental insurance also goes up. I am paying as much now for my wife and myself as I was when I was working full-time. Plus, when working full-time, I had dental coverage and better coverage overall. I have no problem with lawyers getting a fair fee. The people involved in malpractice are due compensation as well. It seems insurance companies may be the culprits. If attorneys’ rates go down and awards go down, I would think insurance rates should also go down. Nothing seems to ever go down, and as a consumer, I am quite concerned. I know Initiative Petition (I.P.) 1 is going to be on the ballot no matter what happens. I am hoping the committee, since you make the big dollars, can come up with the big solutions. I would like to see something positive come out of this committee, satisfactory to all parties.

 

INITIATIVE PETITION 1: Makes various changes relating to certain actions against providers of health care.

 

David Horton, Lobbyist, Committee to Restore the Constitution:

I represent Alternate Health Care Providers. The committee has been asked for legislation that will reduce medical malpractice. It may be possible to reduce medical malpractice in an indirect way. Two examples will illustrate (Exhibit C). When my family moved to Pioche in the early 1960s, our doctor was a naturopath who had run a clinic in Hurricane, Utah, and had delivered about 100 babies. All but two were normal deliveries. One of the two abnormal deliveries was a breech presentation; in the other, the birth canal was too small for the baby. Two percent caesarian delivery was extremely low. Low complications equaled low liability premiums.

 

The other example was from a naturopath licensed in Oregon where naturopathic licensure covers general practice and obstetrics. I asked the doctor what his malpractice rates were. He said they were low, less than what he paid for car insurance.

 

Naturopaths are uniquely well suited to meet rural Nevada’s needs. Their treatments are less expensive and involve patients participating in looking after their own health. This leads to better patient compliance and better results for the dollar. The same results would benefit the poor and the elderly.

 

Dr. Dan Labriola, author of the book, Complementary Cancer Therapies, is a graduate of the John Bastyr College of Naturopathy. He has committed to provide six trained graduates to take Nevada’s examination if we can get naturopathy licensed here. That would bring an alternative therapy to fill an important gap in Nevada’s medical capabilities. A draft bill is attached (Exhibit C) which could serve as an amendment to S.B. 97.

 

I have further experience dealing with malpractice rates. When I was in Lander County, the insurance company increased malpractice rates on our physicians to $12,000. I asked a physician the amount of loss experience for all Nevada practitioners for the previous year. The physician said $500. I suggested perhaps he should talk to his medical board and have them increase the fee for practicing for a year by $500 and self-insure. It is automatically regulated to get rid of the bad apples. I did not hear anything about that for a while, but when I checked back with him, I learned he had purchased malpractice insurance for $2000. Even though this would be a small group, it could have a much larger effect on overall malpractice rates. If you decide to introduce this alternative medicine, Dr. Labriola would be agreeable to addressing the committee.

 

Chairman Amodei:

If we decided to introduce this, Dr. Labriola would probably have to agree to talk with Senator Townsend, since the Senate Committee on Commerce and Labor would cover the licensure process.

 

Ivan R. “Renny” Ashleman, Lobbyist, Nevada Health Care Association (NHCA):

With me is Charles Perry, who is the Executive Director of NHCA. We are here this morning because the organizers of the 18th Special Legislative Session told us due to the chapter covering long-term care facilities, it would not be possible to participate. Long-term care hospitals have essentially the same problems faced by other hospitals and medical providers. Mr. Perry will give you a little background and will be available to answer questions.

 

Charles C. Perry, Lobbyist, Nevada Health Care Association:

I am the Executive Director for the Nevada Health Care Association, and represent a majority of skilled and intermediate care nursing facilities in Nevada. The liability insurance crisis is receiving a great deal of publicity because of its increased cost of coverage to physicians and hospitals and other providers. The nursing homes in Nevada are having the same problems, if not to a greater extent than other providers. In our case, it does not seem to generate as much attention. We began having trouble finding available general and professional liability insurance coverage about 5 years ago. We could not find a correlation of availability of coverage to judgments or even to an increase in litigation. It seemed suddenly insurance companies were not interested in covering nursing homes.

 

Affordability seems to be driven by national trends. For example, nationally, costs today are ten times greater than in the 1990s. In 1990, it cost $290 per bed for liability insurance in nursing homes, and today that same coverage is $2880 per bed. Liability insurance costs in Nevada have kept pace with those around the nation. Right now, we have no admitted carriers writing new or renewal contracts for Nevada’s skilled and intermediate care facility owners. We have only two surplus lines, non-admitted carriers, that will even consider writing new or renewal contracts in Nevada. Admitted carriers and surplus lines, and so forth, are pretty much insurance parlance. I cannot say I am an authority on that, but essentially, these carriers are not required to file rates with our Division of Insurance, they are not required to give notice of non-renewal of coverage, nor are they required to give notice of conditional rate increases.

 

Nursing homes across the nation have become targets of the litigation system. Nevada is no exception. Nationwide from 1990 through 2001, the number of claims per 1000 nursing home beds increased from 3.6 claims to 11. From 1991 to 2002, the average claim cost increased from $64,000 to $200,000, and from 1995 to 2002, claims costs absorbed 21 percent of all the Medicaid increase dollars. I have left national studies for your committee and staff (Exhibit D. Original is on file in the Research Library.). Additionally, I submitted a copy of a U.S. Department of Health and Human Services report published recently that speaks to this subject.

 

In the early part of this decade, an aggressive firm of trial attorneys set up shop in Las Vegas to bring suit against nursing homes. They advertised extensively on television, in movie theaters, in print medium, and they speak at meetings of various seniors’ organizations. This type of legal activity specifically targeting nursing homes has its origins in Florida and has rapidly spread across the nation. The number of claims filed locally against nursing homes has increased dramatically since this firm’s arrival in our community. We believe in the right of the individual to seek redress in the courts. We also know and believe frivolous lawsuits and claims filed without merit are driving the cost of liability insurance beyond affordability. That is why I am here today asking that providers of skilled and intermediate nursing care be included in whatever final tort reform legislation may pass this session.

 

Senator Care:

Mr. Perry, as I understand your testimony, the problem began roughly 5 years ago. There did not appear to be a correlation of availability to judgments or an increase in litigation, just a reluctance to write coverage for nursing homes. It has all changed in the last 5 years, primarily because of this one firm you are talking about. I gather that is the thrust of your testimony?

 

Mr. Perry:

Senator, what I am trying to say is that up until 5 years ago, there were a lot of insurance carriers, giving us a wide variety of choices. Suddenly, without rational reason, it became harder to find carriers interested in either writing policies or renewing them. I believe the situation in Nevada became exacerbated for nursing homes, like other providers, when The St. Paul Companies, Incorporated, decided they were no longer going to provide insurance coverage in the State of Nevada and left. A number of our facilities were covered by St. Paul, and when they began looking for replacement insurance companies, they could not find any interested companies. Previous to that, nursing homes had not had much litigation. There was no claim history, no million- or multi‑million-dollar judgments. There was not even that much activity. It seemed that as insurance companies began looking at profitability, we were not as attractive as other segments of the profession.

 

Senator Care:

It sounds to me like as a consequence of what had happened, mostly with obstetricians and gynecologists (OB-GYNs) and others, you had trouble finding coverage. Has the American International Group, Incorporated (AIG) or American Empire Insurance Company ever discussed with you their reasons for the lack of availability? Did they mention it was due to other carriers being gone? Has anyone actually said to you, “It is because of these other lawsuits filed against doctors that we have to make up the difference, in part, with nursing homes,” or words to that effect?

 

Mr. Perry:

You cannot get them to come out and say that, but we are subject, it appears, to many of the same things physicians and other providers are. In fact, Nevada seems to have been targeted as a hostile environment. The amount of money you are willing to pay does not seem to affect them. Essentially, insurers have raised their prices so high that nursing homes can deduce insurers do not want their business.

 

Senator Care:

What is the name of the aggressive trial attorneys group that has set up shop for suing nursing homes?

 

Mr. Perry:

It calls itself the Nursing Home Justice Center.

 

Senator Care:

I have not seen the advertisements. Do you know where they are based?

 

Mr. Perry:

They have an office in Las Vegas. Most of them came from Tampa, Florida. Florida was the breeding ground of the genesis of the trend across the country to target the nursing home industry. They have a presence in Alabama, Texas, and Arkansas and have set up shop in California. They are moving around the country.

 

Senator Care:

Do you know whether the Florida attorneys are also in Nevada or do they have an arrangement with a Las Vegas firm?

 

Mr. Perry:

I believe they are licensed in the State of Nevada. I really did not come here to beat up on lawyers. I am basically here to talk about the fact the facilities I represent are required to have liability insurance as a condition of licensure.

Senator Care:

I understand that. The reason I am asking is, since we had the 18th Special Legislative Session, this session I am asking for names.

 

Mr. Perry:

I am almost positive they are licensed in the State of Nevada. I have had the opportunity to participate in a couple of meetings in which the managing partner of the firm was present, and they made it obvious they are licensed here.

 

Senator Wiener:

Could you provide the committee the number of nursing homes we had in Nevada 10 years ago, when this trend started, 5 years ago, when the Nursing Home Justice Center came into Nevada, the primary causes of action since the Nursing Home Justice Center was created, and what it had been prior? That would give us a sense of the type of court actions being brought, and an idea of the type of claims, to give us a snapshot of what is going on in the State of Nevada. The senior population in southern Nevada is one of the fastest-growing populations in the world. As we lose nursing home access, I would like to see what is cutting into the opportunities there. Do you have any of that off the top of your head, or do you need to provide that information later?

 

Mr. Perry:

I have a little of that information. Regarding the number of nursing homes in Nevada, we have two kinds of nursing homes. We have freestanding, generally speaking, privately operated facilities. In the rural areas of the State, there are a number of facilities that are part and parcel of the license component of the rural hospital in that area. We have approximately 44 total facilities in the State, encompassing freestanding and rural hospitals.

 

Senator Wiener:

Do you have a sense of how many beds that is?

 

Mr. Perry:

I would say they would average between 100 and 125 beds, roughly between 4500 and 5000. There are a number of facilities whose licensed capacity is not being utilized because of nurse staffing problems. For example, there may be a facility licensed for 100 beds, but only has 80 in service at any given time due to a nursing shortage. That is another problem we are facing along with the rest of the provider community. We have had a small flurry of growth. In 1983 and 1984, we had growth in the nursing home profession, and then again in the mid- to late-1990s, a few facilities came on-line. The number of facilities has remained fairly static, because in 2001, five facilities in Nevada went out of business. Senator McGinness is aware of that, because the facility that had been operating in Fallon since approximately 1971 was one that closed its doors.

 

Senator Wiener:

I sit on a commission on aging, and am not unaware of what you are saying. Our commission is trying to deal with some of these problems as well. Again, if you could provide some of the causes of action, reasons of record that those facilities closed, and any data that could help us follow trends occurring in the past 5 and 10 years, that would be helpful.

 

Mr. Perry:

I would be delighted to do that. The numbers I brought with me essentially come from national sources because we do not have a repository for that type of information in Nevada. I believe I can solicit the type of information you are requesting and come up with good examples for you.

 

Ivan R. “Renny” Ashleman, Lobbyist, Nevada Health Care Association (NHCA):

The State of Nevada had 1,346,698 nursing home days total last year. Interestingly, to Senate finance, if not this committee, 878,731 of those were Medicaid days and were paid for by the State of Nevada. Our financial problem is the State of Nevada’s financial problem with reimbursement costs. Some of the quotes we are getting now approximate as the annual premium, the amount of the coverage. We are being charged numbers around $1 million, and in some cases, more that $1 million for $1.3 million coverage. It is an acute problem. I do not know if we can statistically develop a tremendous amount of information to help this committee. We will do what we can. I think, that as a matter of simple fairness, if this bill covers other health care providers, we should be given a chance to be included. That is our central message.

 

Senator McGinness:

Are assisted-living facilities facing much the same crisis?

 

Mr. Perry:

It is our understanding they are. I had a meeting yesterday with a representative of the Bureau of Licensure and Certification (BLC) who asked if nursing homes were going to have to go the same route as some assisted living facilities. That is, to operate the facility under a licensure waiver because of the inability to obtain liability insurance. They do not have the same issues as nursing homes because they are different, but they are running into the same problems with availability and affordability.

 

Chairman Amodei:

Do either of you know whether your industry has the protection offered under the Medical Injury Compensation Reform Act (MICRA) in California?

 

Mr. Perry:

I understand it does. In the conversation I had yesterday with the representative of the BLC, I learned California has essentially dropped the licensure requirement for insurance coverage because it has become such a problem for facilities in California to obtain coverage. California’s regulatory agency has taken the position they cannot require facilities to have what they cannot get.

 

Chairman Amodei:

That is an interesting statement, because in the materials you provided (Exhibit D), I am looking at the Long Term Care General Liability and Professional Liability Actuarial Analysis, dated March 3. On page 22, which talks about California Loss Cost per Occupied Bed, and at the bottom of the page it states: “Long Term Care operators in California do not appear to be benefiting from the $250,000 cap on noneconomic damages provided to California hospitals and physicians under the provisions of MICRA.”

 

It is on the page that indicates your loss cost per bed experienced in that state. I only bring that up in the context of, be careful what you ask for because it might not do any good.

 

Mr. Perry:

The point is well taken.

 

Bobbie Gang, Lobbyist, Nevada Women’s Lobby and National Association of Social Workers – Nevada:

We are concerned about this issue from a consumer point of view. At the last hearing you held on I.P. 1 and S.B. 97, I did not speak, but asked that a cartoon be distributed to you that gave our message, which is, “Where is the patient in this picture?” We have observed this has been a battle between lawyers and doctors. We know you are concerned about the consumer, the patient, and we want to remind you to keep that in mind. The consumer should be protected with access to affordable and reliable health care. The consumer should also be provided access to the court system and alternative dispute resolution programs for all legitimate claims in medical malpractice.

 

When the 18th Special Legislative Session convened, it cut off the work of the legislative committee studying medical malpractice. We believe that was unfortunate. This is a complex problem, and solely limiting awards and consumers’ abilities to seek redress in instances of medical malpractice will not solve it. We believe the Legislature did a good job in the 18th Special Session, and hope you will give that law a chance to work. Initiative Petition 1 will be going on the ballot if you do not pass S.B. 97. I know you are still considering S.B. 97. We think, at the very least, we should have the extra 1½ years, 2 years from the effective date, to see if there is any effect from the tort reform you passed during the 18th Special Session. We hope you will not pass S.B. 97. I know it is not the concern of this committee, but we believe other issues need review, such as medical errors. The 18th Special Session addressed those issues. The prevention of errors would go a long way in limiting the number of resulting lawsuits.

 

The other issue of concern is putting the spotlight on insurance companies. I attended a hearing the other day in the Senate Committee on Commerce and Labor, and believe there are many underlying factors that need to come to light indicating why malpractice rates skyrocketed so quickly and so suddenly in December 2001 and January and February 2002. A lot of it has to do with the way insurance rates are set. A good deal of it has to do with The St. Paul Companies pulling out of our State and nationally, as well, and leaving doctors without insurance having to find insurance in a hurry. What I learned the other day is St. Paul was discounting their rates by a considerable amount, 15 percent on top of 10 percent. I do not fully understand it, but when St. Paul pulled out and left doctors seeking insurance without the discount, the rates jumped up considerably.

 

It is a problem. Doctors are having trouble finding malpractice insurance at a reasonable rate, resulting in some doctors closing their offices, and resulting in a health care crisis. The crisis really is a malpractice insurance crisis, and I think it has to be addressed from many points of view. We hope the Legislature will address insurance rate setting, reforms with the insurance industry, and the medical errors issue. We would also like to see possible programs for alternative dispute resolution and a further study of insurance reforms for other than medical malpractice. We believe this is symptomatic of future trends throughout the insurance industry. We urge you not to pass S.B. 97, and to give I.P. 1 a chance to work, while continuing to work on other possible solutions.

 

Senator Washington:

For clarification, as we contemplate S.B. 97 and whether we should fashion a bill after MICRA or continue to support A.B. No. 1 of the 18th Special Session, does your group support MICRA in its entirety or should we proceed with what is currently on the books?

 

Ms. Gang:

We are not experts on MICRA. We do believe there are other things operating in other states where a malpractice crisis has not occurred as quickly as in Nevada and other states, California in particular. I believe we have to look at the structure of insurance companies in the states not experiencing a crisis. We are concerned about what else might be in California to keep their rates low. Our message is that we would like to see A.B. No. 1 of the 18th Special Session given a chance to work. We do not believe it necessary to put further reforms in place. In October, when we realized this issue was coming back to the Legislature and affecting a lot of women due to its impact on the field of gynecology and obstetrics, we decided to bring a group of people representing consumer advocate organizations together to see what we could come up with to protect our constituencies. In early January we had a workshop. The participants included groups who had worked together before and those who had not. None of the participants had discussed the issue outside their own group. Yet every organization participating in the workshop concluded the same things: the consumer’s voice has not been heard, consumers need protection of their rights to go to court when they have been harmed, and the law, as passed, should be given a chance to work.

 

Senator Washington:

I am confused as to whether you are going to protect the consumer, and if OB‑GYNs are leaving Clark County and Nevada, it puts the consumer in jeopardy. On the other hand, I hear you saying you want to the keep the caveat open for litigation if there is malpractice. I am not sure which side the consumer is on, at this point. Are you on the side of the doctors who are leaving or are you on the side of leaving the door open?

Bobbie Gang:

I should have said in the beginning we are being careful not to side with doctors or lawyers. We are looking at this as an overall access issue. We realize services are being limited because some doctors are closing their offices. We do not believe the solution to bringing medical malpractice rates down solely lies with limiting awards and attorney fees, which we believe stymies access to the courts. At the present time, it is difficult to bring a case to court, especially small value cases. We do not want people who are injured prevented from seeking redress.

 

Senator Washington:

Are you suggesting we cap premiums?

 

Ms. Gang:

I do not believe it is legal to cap premiums. I hope I am being clear, we do not want S.B. 97 passed; we want you to give the law that did pass a chance to work because the attorneys and doctors worked on it. As far as what can be done about insurance rates, it is a big problem. The Senate Committee on Commerce and Labor is just starting to look at it. We also believe the complexity of the problem merits additional study. Regardless of what reforms are implemented, we hope either the malpractice study committee will be reinstituted, or perhaps a study on insurance rates in Nevada in general will be undertaken.

 

Senator Washington:

Did your group consider the possibility of reinstituting the screening panel?

 

Ms. Gang:

That was not part of what we looked at, but I do recall some discussion. We did not come to a conclusion, but I recall comments to the effect, taking the medical screening panel out seemed to be a mistake because it was there to screen out lawsuits that might not be of value before getting to the court system. We would have no objection to seeing that reinstituted, but we recognized it possibly needed revision.

 

Senator Nolan:

Could you tell me again when your group determined it did not want to support S.B. 97?

 

Ms. Gang:

It was early January. As I said, it was October when the Nevada Women’s Lobby realized this was probably coming back to this session. Until all the signatures passed on the petition, we were not certain. At that point, we started to look at bringing a group together to discuss S.B. 97 and look for allies in whatever venue we thought we could bring before the Legislature from advocacy groups representing consumers. The group that met was comprised of: American Association of Retired Persons (AARP), the social justice committee of Unitarian Universalists, the Lutheran Advocacy Ministries, Nevada Women’s Lobby, social workers, and at least one other group, a group that had not worked on this before.

 

Senator Nolan:

Thank you for that information. As you know, we have a number of representatives who come from groups and offer testimony on behalf of constituencies unknown to us, and we do not know how many people they truly represent or how many people were involved in the discussion. As we go through this process, I believe it important to know how many people are represented.

 

Ms. Gang:

Senator, I have to say I am representing the Nevada Women’s Lobby and the National Association of Social Workers (NASW). The others were present at that meeting and they will speak on their behalf. I am not speaking on their behalf, I am just saying this is the group that was there and came to this conclusion after meeting for 6 hours. We have had two additional meetings to determine what we would do during the current session, and we decided not to form a coalition.

 

Senator Nolan:

In January, the session had not yet convened. We had not had a chance to look at S.B. 97, and as a body are still debating this issue to try to formulate what will be done in the best interest of the citizens of Nevada. If you were told the provisions in A.B. No. 1 of the 18th Special Session would not have the results and consequences we were hoping they would, in fact, it was determined they were not going to bring down premium rates to physicians, physicians would continue to exodus, and costs would rise, would your organization stick steadfast to its opposition to S.B. 97 if this Legislature determined it to be the best vehicle to turn this problem around?

Ms. Gang:

My answer is yes, and I would like to tell you why. Senate Bill 97 is almost identical to I.P. 1. We did know what was in I.P. 1, and we understood the reasons a group of doctors wanted to bring I.P. 1. We did not believe it was right to go ahead with S.B. 97. We do not believe it is solely in limiting noneconomic damages and attorneys’ fees that will bring down malpractice rates. We strongly believe A.B. No. 1 of the 18th Special Session needs to be given time, and along with it, the other factors we believe important to bringing down malpractice rates. We believe S.B. 97 will further limit an individual’s right to seek redress and to be properly reimbursed if harmed in a medical malpractice case.

 

Senator Nolan:

The only other reply I would like to make is there are a number of us who believe I.P. 1 may go through anyway, and if it does, there is a promise of court challenges almost immediately which may hold up the provisions in I.P. 1 from ever being enacted. There are questions about constitutionality with certain provisions in I.P. 1. If S.B. 97 passes also, it might address some of those issues and would give us a backup to I.P. 1. I agree this is not the only answer. The Senate Committee on Commerce and Labor is also addressing insurance issues.

 

Senator Care:

If we pass out S.B. 97, in my judgment, the most significant provision is no longer having the ability to redress no cap on noneconomic damages where the court finds for unusual or special circumstances. It seems to me if you are going to take that away from the consumer, the consumer should be entitled to additional disclosures about the doctor, the hospital, and all others involved. In your role as advocate for the Women’s Lobby concentrating on the consumer’s prospective, do you have any thoughts along those lines?

 

Ms. Gang:

I am not clear about what information consumers are not getting.

 

Senator Care:

I do not know. I am simply saying we added a lot of disclosure language to A.B.  No. 1 of the 18th Special Session before we adjourned. I am saying perhaps one way to stay out of court is obviously never to have a malpractice or alleged malpractice accusation in the first place. Perhaps if patients knew more than they know now, or could know, about doctors and hospitals, the possibility of alleged negligence may be reduced. Maybe they do get enough information. If your lobby has thoughts along those lines, I would like to hear them.

 

Ms. Gang:

I will be happy to take it back to them, and we will discuss those issues. I think each of us operates from our own sphere when we have had to go to the hospital or had a family member who did. We can certainly discuss it to determine if there is more that should be disclosed.

 

Rudy Manthei, D.O., Lobbyist, Keep Our Doctors In Nevada:

I am a practicing ophthalmologist from Henderson and have been practicing since finishing training approximately 16 years ago. I also have other qualifications of which you should be aware. I am the chairperson for Keep Our Doctors in Nevada, and the chairperson for the Osteopathic Board of Medical Examiners, as well as the board secretary for the American Osteopathic College of Ophthalmology.

 

First, I would like to give you an update about what is happening in Henderson. I am here more as a resident and practicing physician of Henderson, and would like to address some of the issues discussed at the hearing on Wednesday, at which Dr. Juarez testified, as far as what is affecting the Deseret Women’s Care center. I have been in communication with the group, and am concerned, especially since they provide a substantial percentage of the health care and obstetrics to St. Rose Dominican Hospital. It was inevitable. They have already started negotiations with a group in Tempe, Arizona, that has a new hospital and unfortunately it appears at least two of the three doctors will be leaving in March. The one remaining doctor is going to try to join another group. I hope what is occurring is not inevitable but can be avoided. We are in the middle of the malpractice crisis, rather than toward the end of it.

 

Another concern is, with Henderson’s population base, we should have approximately 40.6 obstetricians. At this time we have 26, and we are about to lose 2 more. Additionally, the sheet I distributed (Exhibit E) shows the number of licensed obstetricians that will have policies come up on certain dates. Notice that in March 2003, I show three doctors; that was Deseret. What concerns me is all the other obstetricians whose policies will be up for renewal this year are going to have the same consequences to deal with. In April 2003, there are 13 more; in May, 7; in June, 10. October is another large month, at 15. We have a problem with access in this area of health care, which will get worse.

 

I applaud the efforts of Senator Titus as far as working with the short-term solution to financially help keep doctors in the State. I think that has to be addressed. Everything we are currently looking at is a long-term solution. You will find A.B. No. 1 of the 18th Special Session does not change things in the next couple of years. You will also find MICRA is not going to change things in the next couple of years. All we are asking as far as S.B. 97 and I.P. 1 is, if we are going to wait a number of years, is it not better to go with a more comprehensive plan that has been tested in additional states? The Medical Injury Compensation Reform Act has, and I believe insurance companies will come up and make that same statement.

 

What is happening and is affecting me in Henderson is a critical shortage of provider service to the people of the State. It is also affecting the quality of care in hospitals. Physicians are no longer providing emergency care to hospitals due to the risk. Doctors are avoiding high-risk procedures. One of the most prominent Reno cardiac surgeons is now sending his most difficult cases to Sacramento. That same individual told me he has been looking for an additional surgeon to join his group for over a year, and he is concerned that he cannot get a good, quality surgeon to join the group. Getting physicians to come to Nevada may not be difficult, but attracting quality physicians is. The Board of Medical Examiners indicates the number of physicians being licensed in Nevada is decreasing, population is increasing. In my position on the Osteopathic Board of Medical Examiners, I see even more cause for concern. We had a 20 percent decrease in the number of physicians licensed last year. Even more alarming was a 40 percent increase in physician’s assistants. Allowing ancillary individuals to replace physicians in providing care is going to create more problems.

 

I agree tort reform is not the only answer. The medical boards need to be brought on-line to be more responsive to supervising physicians in Nevada. However, those are physicians appointed by the Executive Branch, and many physicians are not there for the right reasons. Speaking as chairman of the State Board of Osteopathic Medicine, our position is we are there to protect the people of Nevada, not the physicians. We must have the ability to do that and be involved in the regulatory process. Reforms also need to occur in the supervision of hospitals and health care facilities, and in dealing with both insurance liability and insurance claims payment. I see everyone blaming the insurance companies. Insurance companies are at fault, the doctors are at fault, and we are all at fault.

 

Take a look at the other sheet I showed you (Exhibit E, page 2), titled “Clark County Medical Malpractice Cases.” Why did our premiums go up in 2002? Clark County malpractice jury awards in 2000 were $5 million total. In 2001 awards topped $21 million, a huge increase. Obviously, insurance companies are going to increase premiums based on the increase. What concerns me is the number of cases that were filed in 2002, and now going into 2003 the filings are going to create even more of a crisis to deal with over the next couple of years, regardless of what we do. I think other options need to be considered. I believe physicians can be part of the solution. Senator O’Connell has a bill addressing the issue also. Her bill deals with the Board of Medical Examiners, which has a fairly large surplus. Legally, the surplus could be used to help physicians unable to pay their malpractice premiums stay in the State.

 

I volunteer my services to the Ernest F. Lied Clinic at University Medical Center (UMC), which is a clinic that works with noninsured individuals. Lied Clinic had 60,000 patient visits last year, and is increasing by 1500 patient visits per month so far this year. We have a huge access problem for the noninsured. Health care has become so unaffordable the private sector and seniors cannot afford it. Even if seniors have Medicare, their secondary insurance is unaffordable. Also, physicians are forced to practice defensively, which makes them uncomfortable, and causes them to overutilize prescriptions. If Nevada had a plan such as MICRA, A.B. No. 1 of the 18th Special Session, or S.B. 97, it could provide a savings of between $340 and $360 million in Nevada. That savings could create a senior prescription plan or tax credits for the noninsured. If we could lower health insurance costs, employers would be able to provide health care benefits. Across the board, everyone is saying, “I cannot afford health care. I am having a difficult time providing access to health care for my employees.” The problem is not simple, but I ask that you look at it as comprehensive. I ask that you look at A.B. No. 1 of the 18th Special Session as a start. I believe it is mandatory to reevaluate the issue now, but it needs to be done in a fashion that will create reform that will work. The doctors need to have hope that what is created will work, and will make them want to stay in Nevada. We do not want to leave, but we want to practice medicine, not defensive medicine.

 

We want to go back to developing bonds with our patients. When you have those bonds, even if you do make mistakes, they are tolerated. Right now, doctors’ offices are zoos. Doctors’ offices see 1 million patients going through, they are turning into mills and losing the personal touch. Physicians do not like it, patients do not like it, and it is causing a lot of the current problems. It is not just tort or hospitals, not just insurance companies or frivolous lawsuits; it is all of these things. It all needs to be addressed. I appreciate the amount of time you are spending on this, and the fact you are not looking for a quick fix. We do need something short-term and long-term as far as trying to keep qualified physicians in the State of Nevada.

 

Senator Care:

Dr. Manthei, your name is synonymous with I.P. 1. The argument of caps aside, do you think there are ever cases where the plaintiff, as a result of negligence, is entitled to a pain and suffering award above $350,000?

 

Dr. Manthei:

I would say yes. Overall, I believe what doctors assume for malpractice is not malpractice. However, I believe if you are dealing with an impaired physician or one that performs an unapproved procedure and is showing intent, at that point, the doctor’s license should be taken away. The problem should be solved. I believe economic damages are important and should not be taken away. I am concerned with the current situation in Nevada, wherein 57 percent of awards are going to attorneys and administrative fees. As far as I am concerned, 100 percent of economic damages should go to the injured individual. I do believe when you can show intent and you have gross negligence or gross malpractice there should be no limit. We are not asking for that. All we are saying is presently the number of cases and the amount of the awards is making health care unaffordable. If health care is unaffordable to a large percentage of people, the rest of the population is denied access. I believe the number of uninsured in Nevada is 600,000, or one-third of the population of the State. That concerns me because individuals who do not have health insurance are not visiting doctors when necessary due to the high cost of health care. The later you deal with a problem, the more difficult it becomes to treat. That is the nature of what is happening.

 

Senator Care:

The policy argument would be if you cap it at $50,000, that is just the price of having doctors available when you need a doctor. You have to say to the person who has suffered in excess of $350,000, tough luck. Let us say a person loses his eyesight due to an honest mistake. What do we say to that person if we cap at $350,000, and we do not have availability for something higher? I would call those unusual circumstances.

 

Dr. Manthei:

I will tell you why that particular individual lost his vision. The area to the visual cortex has end vessels; there is no collateral circulation. If that circulation is blocked, it is like having a stroke to that very small area of the brain. During cardiac procedures, you have low profusion, and if you have arterial disease, those end arteries can be closed off, in which case, the individual can lose sight shortly after surgery. You say the same thing to that individual that the federal government said. That is, in order for us to exist, this is what we have found necessary in order to provide services to the whole. Is it fair? No, but that is the way things are. You have to have an understanding that not everything is necessarily fair. Money is not the answer here. The quality of care when you have health problems is most important. If we get away from what constitutes quality of life, education and health care, two of the most important things in my opinion, what is money?

 

Senator Care:

Because you have gathered enough signatures, I.P.1 will be on the ballot in 2004. If we enact S.B. 97, in a form less comprehensive than what is contained in the petition, is it still possible we could do something less than S.B. 97 that would satisfy the doctors to the extent they would ask the voters to ignore the ballot question? I want to ensure we do something during session that will be productive. I just want to know we can come up with something less than the entire petition that would keep the medical community happy enough when 2004 gets here, they will not have to continue to worry about voters enacting I.P. 1.

 

Dr. Manthei:

I believe the physicians are willing to work in any capacity to create comprehensive reforms to stabilize the situation. I, as an individual, am also concerned the people of Nevada are represented. Obviously, we are willing to look at any recommendation. We want to be part of the solution.

 

Senator McGinness:

You talked about the Board of Medical Examiners protecting doctors. Are you talking about protecting doctors’ practices or protecting the marketplace?

 

Dr. Manthei:

As far as physicians being on the board of medical examiners for reasons other than to be a part of providing services to Nevadans and protecting Nevadans, it is my understanding that has occurred in the past.

 

Senator McGinness:

There were times when Nevada had the toughest doctor-licensing requirements in the United States, and on one hand, you think that is a good thing. On the other hand, they are keeping a lot of doctors out. Is this true?

 

Dr. Manthei:

No, our board just increased our licensure requirement in order to go to 3 years post-doctorate training concurrent. Doctors of ophthalmology are usually primary care physicians, which, as many of us did, went to medical school, did 1-year internship and went out to practice. Times have changed. You are not seeing doctors coming out of medical school anymore because medical schools are not providing enough hands-on training due to litigation concerns. The standard of care has changed, so doctors coming out of medical school need 3 years of concurrent post-doctorate training even to go into primary care. The other board has been criticized for requiring a “specs” exam, which is an all‑encompassing medical exam for an ophthalmologist who has been in practice 20 years, as being a hindrance to access. I would agree. I agree we have brought the level of entrance into Nevada to the highest level in the country. I believed it was necessary, based on some things that occurred in the past, especially in North Las Vegas and other communities where the quality of physicians was less than stellar.

 

One of the things the boards need to do now is competency testing. It is ridiculous to believe you can get a license and 20 years from now, not be reevaluated periodically to ensure you are maintaining a certain level of competency. I believe physicians are now aware of this and taking it more seriously. I believe it important to aggressively deal with this issue to maintain the desired quality of care.

 

Senator McGinness:

In rural Nevada, it is difficult to recruit doctors. Often rural communities are happy to get doctors who received their medical licenses outside the United States. I have often been asked to intervene in helping doctors get licensed when they come from out of the country. I do not want to see a double standard for doctors practicing in rural Nevada.

 

Dr. Manthei:

I agree, and have had a similar problem getting physician assistants (PAs). My personal feeling is that PAs are to work with physicians, not to replace them. Placing PAs in a small area where there are no doctors to work with indicates a willingness to allow a lower standard of care than would be required in a major city.

 

Senator Washington:

In A.B. No. 1 of the 18th Special Session, we eliminated the medical screening panel, and there is currently an idea to reinstate that panel. From the doctors’ perspective, do you think the medical screening panel was inept in dealing with medical malpractice issues? How can we make the panel more efficient?

 

Dr. Manthei:

I believe the medical/dental screening panel should be reinstituted. I will admit it was not working. Part of the problem was we were not providing due process in a timely manner. Taking years to resolve cases is not fair to anybody. I believe the physicians were just as much at fault as attorneys. I also believe people are too busy and unwilling to put an adequate amount of time into getting things done. There were unnecessary delays. I believe it was wrong to do away with the screening panel rather than trying to fix it. I would like to see a requirement to spend a certain amount of time serving on the screening panel be a mandatory part of licensing in Nevada. It would open many doctors' eyes to existing problems.

 

Senator Washington:

In rereading S.B. 97, something keeps recurring in section 1, subsection 1, dealing with contracting with attorneys and collecting contingency fees. The argument has been in certain cases, the attorney will not handle a case if unable to collect contingency fees. The consumer in a malpractice case should not be hampered in his ability to obtain an attorney due to contingency fees. What is your thought on placing constraints on contingency fees?

Dr. Manthei:

Legal fees and costs are as out of control as medical fees, litigation, and liability fees. States that have MICRA have no problem with access. The number of per‑population malpractice cases in California is almost double that of Nevada. More importantly, the individual gets approximately 18 percent higher net awards from legal decisions. I would like to see attorneys control their costs. It is nice to be able to charge what you want and create bills, but those costs are being relayed back to the consumer. Legal costs are exorbitant. We need to find a way of controlling costs and access. In this area and almost every area of business, as well as in government, the fee structure and cost of litigation is out of control.

 

Senator Washington:

I would not disagree with you. Our job as policy makers is to create some boundaries within which the market can operate without restricting the market. I believe artificial caps are like setting rent control. In my opinion, the client should have the ability to negotiate with doctors for services provided and attorneys for their services, and work within the negotiated boundaries. I am concerned about contingency fees. I agree there are some lawyers who milk the system, and that industry should do a better job of policing itself.

 

Dr. Manthei:

I do not disagree. That section of the bill is specifically for the people of Nevada. If the consumer can get what he needs from S.B. 97 without being taken advantage of, I believe it would be fair and appropriate. For the most part, however, physicians are capped; we do not have flexibility in our fees. We understand things have changed due to past abuses.

 

Senator Nolan:

In your experience, when making assessments against a doctor’s license, do you believe a recommendation should be made at the screening panel level, or if we were to reinstitute the panel, what do you see as the panel’s role in making recommendations or taking actions on a physician’s license? Do you believe that should strictly be a board function?

 

Dr. Manthei:

I think members of the screening panel need to communicate. It is not part of the board’s responsibility to go out and look for bad doctors. If, in fact, that is what they want the board to do, the board needs to be informed. We would like to be fair, and we want to address the issue, but our guidelines, as board members are very narrow.

 

Senator Nolan:

I appreciate that. There has been a lot of discussion about reinstituting a screening panel and trying to take care of some of the problems that made it an ineffective body. I would like to see it done because I believe it is part of the solution to bringing insurers back into Nevada. I also would appreciate recommendations from the physicians you represent about how to make the screening panel more effective. I know the Trial Lawyers Association would have to be involved. I would like to see this debate happen early in this session, so it does not end up being a trigger or leverage at the end of session to make something else happen. We need a deliberate debate between the trial lawyers and physicians on this issue and to construct something that will be effective.

 

Dr. Manthei:

I agree, and I would like to see fast-tracking. It should take no longer than 1 year, and I believe the physicians should make themselves available. From my understanding, some of the time constraints have been judicial. As far as the medical/dental screening panel, to give it 1 year, no exceptions, is a better way to deal with it.

 

Senator Nolan:

Regarding contingency fees, it falls under another question, but I need an answer to this question first: In an award, do the contingency fees also come from the pain and suffering settlement, as well as punitive damages?

 

Dr. Manthei:

Contingency fees come from both the pain and suffering portion of the settlement and the punitive damages portion.

 

Senator Nolan:

Right now there seems to be a threshold amount of $250,000 that MICRA instituted, and that is currently floating around Congress. The difference between what went through in A.B. No. 1 of the 18th Special Session with the $350,000 cap, and what is being proposed of $250,000, leaves $100,000 per case for which the insurance company would be on line. As I understand it, insurance companies, unless there is overage insurance, do not pay punitive assessments. Is that correct?

Dr. Manthei:

I cannot answer that question.

 

Senator Nolan:

My question then is, if we are hung up on the difference of $100,000, which is the amount an insurance company would have to pay for pain and suffering, that is the amount truly being distributed amongst the additional insured that any insurance company would have? I am wondering why that $100,000 is truly a threshold.

 

Dr. Manthei:

It is not the amount. Another part of A.B. No. 1 of the 18th Special Session that is ineffective is not the difference between $250,000 and $350,000 or $400,000. It is a matter that in MICRA is stated “per event,” so there is one cap. In A.B. No. 1 of the 18th Special Session it is “per defendant,” so there are a number of caps. It is not defined. The exceptional circumstances create ambiguity as far as interpretation. In my understanding of the actuarial from insurance companies, if you create these openings, it will be a period of time before you can figure out how long and what is going to happen to the loss ratio. That is what we are trying to get away from. We want it to be concrete. You have a cap and it is per event. The exceptions of gross negligence or gross malpractice are no problem. The other things make it too porous.

 

Senator Care:

I asked earlier if we could perhaps tamper with S.B. 97 and come up with language agreeable to everybody, but I forgot to ask if you were testifying on behalf of yourself or on behalf of Keep Our Doctors In Nevada. In the 18th Special Session, we had Physicians Task Force and Concerned Physicians of Nevada. We are talking about three different entities. The other two are gone; they were established for the purposes of leading up to the 18th Special Session and through it. What is the distinction between Keep Our Doctors in Nevada and Physicians Task Force? There is a tendency in Carson City to say “the doctors,” but there are doctors and hospitals all over Nevada. Even if we come up with something that satisfies you, that may not be case with the rest

of the medical community. Could you give us an idea of who Keep Our Doctors In Nevada (KODIN) is and whom that organization represents?

 

Dr. Manthei:

The task force is actually still in existence and was a small, select group, by the members’ own decision. The osteopaths, of which I am a D.O., and many other groups, asked to be part of it and were not included. The group I am working with now is sponsored by the Nevada State Medical Association, Clark County, osteopaths, physical therapists, occupational therapists, optometrists, dentists, all the medical groups, and their societies. There is no way to be able to say everyone supports you, but we have all the medical societies, and that is whom we are representing. I do not pretend to be making all of the decisions, and I do not want to make all of the decisions, because I do not want to be blamed for what happened during the 18th Special Session. Unfortunately, I do not agree with a lot of the things that occurred. My purpose is, if we can improve things, to do that and move on. I believe that same group is supporting us. I do not want to represent KODIN as just being physicians; it is not. Physicians are a major part of it. We are the most likely and knowledgeable in this area. However, it is access to health care, it is the people in Nevada, it is taxpayers, it is businesses, it is all of us who want adequate access and affordable health care. I do not want to make it a doctor/lawyer issue. If it is that narrow a scope, it will not fix the problem.

 

Chairman Amodei:

I appreciate your global view. We have in S.B. 97 some proposals aimed directly at the litigation system. We have had a discussion about the board of medical examiners and so forth. I have looked through the tab in our book in terms of other provisions either on the bill draft request list or that have been introduced. There is something dealing with the medical screening panel, and I think members of this committee and members of the other House also have concerns. What I am not aware of, and what makes our discussion problematic at this time, is a piece that says here is what we need to make a change in the medical errors area, and here is what we need to change in terms of physician discipline, and if we are going to have a global discussion, some of this is not in the jurisdiction of this committee. I submit to you, as we sit here at day 39 of 120, if we are going to have a global discussion, we need global proposals. Right now there is no tune-up of errors, which we also attempted to deal with in A.B. No. 1 of the 18th Special Session. If there is more work needed there, we certainly need to hear about it. The reason I am directing these comments to you is due to my naïve belief those who work in the system every day are probably better equipped to come up with ideas than those who do not. I am unaware of a piece that talks about some of the areas you brought up.

It would certainly help facilitate the discussions of everyone in the Legislature to have something that could say, for example:

 

Look at what happened in A.B. No. 1 of the 18th Special Session, here is what we think the facts support. When we look at what we need to do in terms of risk management and those areas for physicians and health care providers, whether they be nursing homes or not, here is the piece of that.

 

Senator O’Connell has a piece in terms of short-term potential solutions. I know Senator Titus has a proposal. If there were something like that out there now, it would help us in terms of trying to grasp in a global sense all of this in a regular session as opposed to a special session context. Hopefully you can help us out.

 

Dr. Manthei:

As far as technology, medical errors, and hospitals, actually UMC is a beta test site, and I have been talking to Dr. John Paul Christen, Chief Financial Officer, Valley Health System, about the outcomes of that system. I believe one of the other hospital groups is looking at that also. That technology is coming of age, and I think is about ready to become available. Even if you mandated its availability, it is right around the corner. I can make that information available to you.

 

As far as dealing with the medical boards, I am sincere about creating changes. I am part of a little board, but the physicians also believe there needs to be changes at the board level, and they want to be part of that. I will be available to do whatever I can to be part of the solution.

 

Bill Bradley, Lobbyist, Nevada Trial Lawyers Association:

I came here this morning with the intent of making one presentation, and based on a lot of things I have heard, there are a lot of questions I would like to answer from the legal and consumer prospective. Chairman Amodei originally asked me to speak about trends in filings. That is why I have produced for you another package (Exhibit F. Original is on file in the Research Library.). I would like to spend a little time talking about trends. Certainly the big policy pictures you people face are very important, but I believe it important to look back at the facts. To be candid with you, before the 18th Special Session, I believe we had a good system. We are learning in Senator Townsend’s Senate Committee on Commerce and Labor that what precipitated a lot of this was a horrible series of events involving St. Paul. The committee meeting CD-ROM is available, and I am going to get a copy. I know you do not have much free time, but the discussion that occurred in the Senate Committee on Commerce and Labor on Tuesday was fascinating and insightful on what caused this problem.

 

I would like you to turn to page 3 of the package I handed out to talk a little about trends. We attempted to accumulate for the committee a history of the screening panel filings in Clark County by year and compare it to the population increase in Clark County. Without going through all the numbers, you will see up through 2001, with little bumps, there is not a significant difference in the number of filings occurring at the Medical Legal Screening Panel and the growth population. In addition, the court filings show a consistent flow of cases, consistent with growth for the most part. The large increase that has happened since November, we all told the Legislature about when we passed A.B. No. 1 of the 18th Special Session. That was because, at the insistence of the insurance industry, the screening panel ended. It is important to address the screening panel, and I want to do that, but when the screening panel ended in October, the majority of the people in the panel elected to get out of it because it was too long and too expensive. That is why you see the big jump in filings.

 

My second chart is the bar graph. Since the conclusion of the screening panel as of October 1, filings jumped up in Clark County, temporarily reflecting the departure of many parties from the screening panel. As you can see as we get through February, the filings are coming back down to pre-panel dissolution status. An important thing to realize in this debate is, on the one hand we are talking about MICRA, and I.P. 1 and S.B. 97 go further than MICRA. In addition, in California, there is no medical screening panel. As a matter of fact, there is no requirement of an affidavit in California. The only thing required in California is a certificate of merit filed by an attorney saying the plaintiff has spoken to a physician, and the physician indicated this is a meritorious claim. It concerns me when I hear committee members talking about bringing the panel back, because A.B. No. 1 of the 18th Special Session instituted a different set of legal barriers to an injured victim. That is tort reform, and I am not aware of a state that has both tort reform and a screening panel. When it is too difficult to move through the system, and you compare that to our right to jury trial, I believe it is going to create significant constitutional problems. That is why I started off by saying if we knew a while ago what we now know about the insurance industry, we had a good system in Nevada.

 

Senator Washington:

I would like to propose an idea to you. Last session or a couple of sessions ago, we dealt with setting up a business court that would just deal with business issues, filing fees, and so forth. We went through the interim and finally put that court together. I know this session we are going to deal with intermediate court and appellate court. I am wondering, if we did not institute a screening panel, but took that appellate or intermediate court to fast-track cases, keep the expense down, use expert witnesses and testimonies, perhaps we could speed up the filing and obtain quicker decisions without the expense of setting up the screening panel again. What is your thought on that?

 

Mr. Bradley:

Senator Washington, you raise a good point, and believe it or not, we addressed it in A.B. No. 1 of the 18th Special Session. What I want to make clear before I directly answer your question is we worked with people who were then represented as the physicians representing physicians in Nevada. We worked with them for 8 to 10 months before the 18^th Special Session. Many of the concepts brought up by Dr. Manthei we tried to bring up in those meetings: board of medical examiners, medical errors. We could not get that discussion; it was a train going down the track for tort reform. In A.B. No. 1 of the 18th Special Session, we shortened the time frame for the courts to consider malpractice cases. Before A.B. No. 1 of the 18th Special Session, we had what was known as the 5-year rule in any case. When you file a case in the district court level, you must get it underway within 5 years of the date of filing. Otherwise, it is thrown out never to be heard of again. In the context of medical malpractice, A.B. No. 1 of the 18th Special Session shortened that to 3 years. That is the law right now.

 

I think after 2005, it actually gets shortened again to 2 years. There is not a flood of these cases in the courtrooms, and I do not think we could justify business court. More importantly, this Legislature, through careful consideration of A.B. No. 1 of the 18th Special Session, did a wonderful job of shortening the time frame. That is certainly a key component in reducing costs. If we reinstitute a panel, we incur a significant amount of costs on the front end again, and significant time delays. Then, after we have gone through that, we face barriers presented by tort reform beyond A.B. No. 1 of the 18th Special Session, which is contained in both the I.P. 1 and S.B. 97. Those are the things for which I fear constitutional issues. I do not want to see A.B. No. 1 of the 18th Special Session declared unconstitutional. I will go back to the testimony you all heard last week from the No. 1 man in insurance in Nevada, Bob Burt. He said if A.B. No. 1 of the 18th Special Session survives constitutional challenges, it is going to lower rates. That is a tremendous statement from an insurance person. I hate to say this, but S.B. 97 goes further than MICRA, the initiative petition goes further than MICRA, and it contains constitutional problems that were avoided by A.B. No. 1 of the 18th Special Session.

 

I think it is important to look at this (Exhibit F). These are the 21 jury verdicts that occurred in Clark County from 1995 to 2001. I want to use one as an example. Sample No. 3 is Burney v. Kramer. Unfortunately, Dr. Kramer was Dr. Jamison’s partner, the woman obstetrician who asked for hope. In that case, there was a tragic birth trauma to a baby, and as you can see, the screening panel determined Dr. Kramer’s care was negligent. That is a significant finding when three physicians agree there is negligence. If this were a perfect world, long before that case went to the screening panel, Dr. Kramer’s insurance company would have come to the Burney family and said, “We have had a terrible accident. Something bad happened, it was our fault, and we want to take care of your family.” Again, I will tell you that does not happen in this system. If it would, it would take the lawyers out of it, it would take the experts out of it, and it could work very well. Before the lawsuit was ever filed, I believe Dr. Kramer’s insurance company knew it had a big problem. Under the insurance policy we talked about before, whenever a physician commits an act that is probably negligent, that physician, pursuant to contract, is required to notify his insurance company. It is called a notice of potential problem, and it is contained in the insurance policy.

 

When that call goes to the insurance company, the insurance company says tell us what happened, and in some instances, get the records to us. Within a couple of weeks, a committee of physicians is convened within that insurance company, and they review the medical record and determine whether there is a problem. They start setting money aside in their reserves, for if and when that family brings an action. Instead of saying we have a problem; let us get out there and deal with it, now the family is struggling with the horrible effects of this birth traumatized baby. There is no help. Mom cannot work any more, Dad is struggling, and the bills keep building up. There is no relief, no one will give them any answers, and in desperation, they seek a lawyer. In Burney v. Kramer, nobody went to the Burneys for a long time, it went through the screening panel, both sides spent $25,000 to $30,000 accumulating expert testimony, and the screening panel decided negligence. That is a strong statement under our screening panel. Dr. Kramer has $1 million in coverage, and it is not difficult to understand that the long-term care of a birth-traumatized baby is going to be well in excess of $1 million. But that is his insurance policy, and that is really a de facto cap. If they offer the $1 million early on, the plaintiff has to take it. They can pursue the physician if they want, but it will mean many years of court, tremendous expenses, and it will mean risks. I do not know anyone who can look at a $1 million offer on behalf of a child early in the process and say, I am sorry, I cannot take that. The desperation, the hopelessness associated with that family mandates they take it and move on.

 

That did not happen in Burney v. Kramer even though the screening panel said, malpractice. The plaintiff in that case demanded the $1 million policy limit. Senator Washington, we talked about consent before, and it is interesting, we heard in Senator Townsend’s committee from an insurance company in Wisconsin, that in Wisconsin, they have banned the consent clause, wanting to take emotion out of these tough decisions. If the doctor, no matter whether the screening panel rules the doctor at fault, says he disagrees with the panel, the insurance company cannot begin negotiations. We know that did not happen in Burney v. Kramer though, because there was an offer made of $200,000. I do not know why that offer was made, but generally it is a war of attrition. The family is struggling, bills are adding up, things are tough, and it is a little carrot the insurance company offers. The family says, sorry, we have already spent $35,000 at the screening panel. They went to trial, and a verdict was returned for $5,350,000, $4,350,000 over Dr. Kramer’s policy. Dr. Kramer now has a verdict against him, his name has been dragged through the mud, he has had to go through a trial, and the case has been going on 4 years. His insurance company could have gotten out for $1 million and brought an end to litigation. There is now a huge verdict of $5 million, and the insurance company turns around, and based on their bad decision, incorporates that $4 million loss into the other physicians’ rates.

 

That is not all. The insurance company from then on looks at Dr. Kramer like he has a $5 million verdict, even though he was saying he wanted out. It was the insurance company that made the decision, but they hold it against Dr. Kramer. Secondly, the insurance company would only insure Dr. Kramer if he stopped practicing obstetrics. Since Dr. Kramer is a partner in a medical practice, his partners' rates will rise also. That is what happened to Dr. Jamison, just because she was the partner. You will see this over and over again, where the screening panel was functioning, and the judge was making a recommendation.

If you look at the next one, Pucket v. Valley Hospital, in that case there was a negligence finding, and the judge recommended the plaintiff take $100,000. The plaintiff was a little higher, $225,000, but there could have been some negotiation. There was no negotiation because the defense never made an offer, even through there was negligence, and there was a verdict of over $900,000. Our point is, Dr. Manthei is right; this is not a fight between doctors and lawyers. The insurers control a lot of this. If you look through this chart, you will see time and time again, the irresponsible decision of the insurance company led to a verdict. I do not think there is an excessive verdict here, or a frivolous lawsuit, but you will see these are the 21 verdicts in Clark County. What it tells is an insurance company is not listening to its screening panel or its own claims committees, and proceeding in cases, getting verdicts returned against them, and then blaming the jury system.

 

Senator Nolan:

Is it possible the physician, after going through a screening panel and being declared to have been negligent, absolutely disagrees with that verdict, and says, “I was not negligent?” In the case of Kramer, he felt it was worth his reputation to actually take this to a jury? Sometimes it is not just driven by the insurance companies, but may be driven by the physician in the case of being determined to be negligent.

 

Mr. Bradley:

If the physician is adamant he did nothing wrong, he is entitled to go to jury trial, and 75 to 85 percent of cases that go to trial are won. The other extreme, which we see in this chart, is where the physicians were found to be negligent by the screening panel, and every time you see there was a defense offer, it means the physician consented. Then it becomes an insurance issue, because, unfortunately, the physician has no input on the amount of the settlement. Once the physician gives his consent, it is totally up to the insurance company.

 

Senator Nolan:

I have just taken on a new perspective with respect to some of these cases. With the testimony you provided in the Kramer case, I am familiar with Dr. Kramer. He saved my son’s life by performing an emergency caesarian delivery. He was a physician who was available and was there when we needed him. He also delivered my other two children. I know of him as a physician with a fine reputation. When I see this case in which the jury determined he had committed some time of negligent act, and awarded against him, I can see where a physician with a good reputation would want to take the case to a jury if he or she was determined by a panel to be negligent.

 

Mr. Bradley:

The toughest thing about this is, that case does not in any way mean Dr. Kramer is a bad doctor. When you are dealing with humans, whether treating them or in a hospital context, and there is a miscommunication or a prescription error, such devastating consequences can occur. This chart was meant to reflect there are not jury verdicts out of touch in Clark County. There are not excessive verdicts or frivolous lawsuits because of the screening panel. Had the insurers followed the recommendations of the screening panel, there could have been a tremendous cost savings that could have been reflected in our premiums.

 

I would like to talk a little about damages, so the committee has a clear understanding of damages in one of these cases. In the context of damages awarded in a tort case, there are two categories: compensatory and exemplary or punitive. Compensatory damages are then broken into two types: economic and noneconomic. Remember these damages are designed to compensate the injured person for the economic damages they have incurred as well as the noneconomic damages incurred. Punitive damages are designed for a totally different reason; that is as the conscience of the community to punish that wrongdoer because the conduct was so bad and to deter that conduct from ever happening again. When we talk about medical malpractice; that does not exist. You can never prove a doctor went into a situation intending to hurt somebody. It just does not happen. It is in a state of mind. Whether we are talking about a state of mind intending to hurt somebody, punitive conduct, or gross negligent conduct, which is still a state of mind, it does not happen.

 

Although we have the exception in A.B. No. 1 of the 18th Special Session for gross negligence, the way gross negligence is defined is never going to enter the picture on a person’s damages in a medical malpractice case. It sounded good, because certain Legislators believed certain cases constituted gross malpractice when it is so clear there was a mistake. Products liability, cases against insurance companies, this is how you get their attention, but not in medical malpractice. These are the two kinds of damages, and this is where the cap comes out of $350,000 under A.B. No. 1 of the 18th Special Session. You asked the question: What is the difference between $250,000 and $350,000? The $250,000 cap was passed in California because in 1974, California legislators believed the $250,000 was a balance for the noneconomic damage component of an injured victim. That value in California, because there was no consumer price index figure, which I personally believe we need, is still $250,000 in 2003. When you compare the value of money over time, that is really $83,000, currently. I hope none of us is here in 20 years when some lawyer is saying please raise that $350,000 cap because it has not been raised in 20 years.

 

The reason we all agreed with the group we were led to believe was representing the doctors, on the $350,000, was because it more appropriately represented a number people could agree on. The figure of $250,000 was picked out of the air by legislators in 1974, but today it is worth $83,000, and it is tragedy and injustice in California. I disagree strongly with Dr. Manthei. It is unfortunate the senior citizens left the hearing, because trying to find a lawyer in California to represent a senior citizen on a wrongful death claim, because the legislature declared in 1974 a senior citizen’s life to the spouse was worth $250,000, is difficult because they do not have access to lawyers. Stay‑at‑home mothers, who are not wage earners, do not have access. The deaths of children are claims that are thrown out of the system in California. We do not believe they should be thrown out, but when you have a cap, and the only thing you can recover is noneconomic damages, and the costs of bringing that lawsuit are so high, you cannot justify bringing the case under a system with inflexible, hard, rigid caps. That is why we keep bringing up seniors, non‑wage earners, and children. It does not work because the insurance industry never comes to these people and offers to resolve the cases before they seek legal counsel; they make lawyers fight to the bone, and both sides incur high costs.

 

I talked a little about the de facto cap, and I want to ensure everyone understands that. When the physician has a $1 million policy, and the physician offers that $1 million, it has to be a tragic case. The family has two choices: to take the money and sign the release papers, or go to court and try to get an excess verdict, which will take the next 5 years perfecting at the Nevada Supreme Court. Once it is perfected, the family is forced to pursue that doctor, individually, for another 3 years to collect the judgment. Unfortunately, there may be bankruptcy proceedings, movement of assets offshore, all kinds of things no competent lawyer can look his client in the eye and say, “Let’s go forward and chase him down.” That does not happen. I believe there is one case in my summary where that did happen, but in 21 years I have never pursued a defendant individually for judgment. When the offer of $1 million under the policy is made, particularly early on, there is no choice. It may not be enough, but it will have to work. What happens, in cases such as Burney v. Kramer, when the $5 million verdict came back, the doctor became angry with the insurance company for putting him into that position? Many times, there is a second lawsuit brought by the physician against his insurance company for not treating him fairly in the litigation process. Physicians often recover significant damages, the amount of the excess verdict against the insurance company, because the insurance company did not fulfill its obligation of good faith and fair dealing in the settlement and negotiation process of the case.

 

Senator Washington:

In cases in which the insurance company refuses to settle and the awards are quite high, what is the percentage the lawyer retains from the verdicts?

 

Mr. Bradley:

The percentage is based on a contract. It is typically one-third; it may be 40 percent. In my opinion, any lawyer that charges above 40 percent is charging too much.

 

Senator Washington:

In your tenure, what type of law firms have you found usually handles these types of cases?

 

Mr. Bradley:

Incredibly specialized law firms. The area of medical malpractice is a difficult area, as it should be.

 

Senator Washington:

It is not the ambulance chasers?

 

Mr. Bradley:

No, that is the other fallacy about medical malpractice, that there are frivolous cases. Unfortunately, when an allegation of medical malpractice is made against a physician, the physician automatically says they are calling me a bad doctor. That is not true. To make the decision to file a claim takes a lot of thought, in my opinion. Additionally, we know we will be fighting the most aggressive insurance industry in the nation, the medical malpractice carriers, and we have to be prepared to spend $100,000, $200,000, $300,000 because they put you through the wringer. It is truly a war of attrition. If I have two qualified experts who say this is malpractice, the insurance company will bring in three experts saying it is not. Each of those experts has a deposition fee of $10,000. When we bring them into the courtroom, they have another fee. Unfortunately, we cannot get local physicians. Northern Nevada, where I practice, is still a small community. I have many physicians who will review cases privately for me and tell me whether, in their opinion, the cases have merit. However, they will not say publicly what their opinions are due to a fear of being ostracized. They are ruled by the “conspiracy of silence.” The screening panel was designed to resolve those meritorious cases earlier, but it failed miserably.

 

Senator Washington:

Why did it fail?

 

Mr. Bradley:

It failed for a number of reasons. Remember, I was a drafter of the screening panel, which was forced on physicians in the 1980s. You cannot forget the word “screening.” It was designed to screen, not to be the final judgment. For one thing, medical records are impossible to read. Although, you hope the story was told in the medical records, many times, according to the physician, it was not told. We started off with the idea of screening, just looking at medical records. Then the lawyers got a hold of it. Soon we had affidavits from the doctor that said, “I know this is what my record says, but this is not what I meant.” Next, we had all these affidavits going back and forth, and soon it became a big mess. The problem is there is nothing under oath. None of those people are subject to cross-examination. I can bring you evidence of false affidavits, probably on both sides. The lawyers ruined it, to be honest with you. It took forever, particularly in Clark County. It turned into a nightmare. It was a shame because, properly done, it could have worked as a screening process. You cannot add significance to the decision in the absence of cross‑examination.

 

Chairman Amodei:

While we are on that topic, I am looking through the tabbed section of the Work Session document, “Medical Malpractice Background Information” titled “State Caps on Damages” (Original submitted as Exhibit F in the Senate Committee on Judiciary Minutes, dated March 5, 2003, and is on file in the Research Library of the Legislative Counsel Bureau.). In terms of states that have caps and also have screening processes or mandatory arbitration, it looks to me like it is not uncommon, because of the prior statement about constitutional concerns. I am just going by the information under that tab, but I would like you to take a look at that. I do not think anybody is suggesting what is in play is a return to the screening panel pre-18th Special Session, but if you have any thoughts on a process to provide some timeliness in a meaningful sense, obviously we would like to have the benefit of those thoughts.

 

Mr. Bradley:

Fair enough. We have a videotape of a television news story that played on KVBC-TV/Las Vegas on March 11, 2003, titled “New Keep Our Doctors in Nevada Campaign Ads” (Exhibit G). I am not trying to criticize Dr. Manthei or KODIN. I do believe it is important for this committee to focus on the facts coming out of Las Vegas about this obstetrical issue to make sure we keep in context there is good medical coverage. I am not saying there is not a crisis in Nevada, because I believe there is, but I do not think it is attributable to our court system.

 

Senator Nolan:

One thing the reporter on the clip we viewed did not ask was whether she was looking for obstetrical or gynecological care. She said she was looking for an OB/GYN, and I believe that would make a difference in the report. If she was asking for gynecological care, perhaps there was a doctor who would take her. If she said she was pregnant and needed a doctor, is that what she was asking?

 

Mr. Bradley:

She did. That was the tape that ran on the 6 o’clock news. I think she said, “I am pregnant,” but I know it was on the 11 o’clock news that she called doctors’ offices saying, “I’m pregnant, I’m new to the area, and I’m looking for an obstetrician.”

 

Chairman Amodei:

Senate Bill 97 has some components and it is missing some components. I would submit to you, the same type of things I talked to Dr. Manthei about, which was in the 18th Special Session, we took a global look at this in terms of medical errors reporting and discipline, and so forth. To my knowledge we are not doing that right now. This committee is obviously focused on the tort aspects, and to the extent you are nervous about physicians trying to get into the legal system to change the rules, if I was a physician, I would be equally concerned about lawyers talking about our discipline and medical errors reporting. However, since it is America, if you have any suggestions, we would appreciate those in a timely manner, considering it is day 39, and April 11 is the deadline for out-of-House-of-origin. We are going to attempt to work session something in this area before April 11.

 

As I look down this list in terms of S.B. 97, there is nothing in the bill presently about alternative dispute resolution or screening, but we have had that discussion. We have joint and several issues, but periodic payments is an issue we have not heard much about. I understand from the insurance representatives it is from a cash-flow context and would make their lives easier. We have not heard a lot about the collateral source issues. We have heard about the exceptions, gross negligence, but not in terms of the other circumstances, as far as trying to define them in an operational sense. We are going to have another hearing on March 25.

 

Mr. Craigie, to the extent any of your representatives have specific thoughts on direct impacts on insurance premiums, either negatively or positively, we would be interested in those thoughts.

 

Mr. Bradley:

I would like to go back to the first chart regarding the trends in the 1995 to 2002 malpractice filings. The one part of that chart I did not mention to you, that I believe bears mentioning as part of an explanation for the filings, is the column on the far right. These are what we call the repeat offenders. You have heard us talk about one repeat offender named Dr. Francis D’Ambrosia. We have given you the data to back up our statistics showing it is generally a small percentage of the physician population causing the problem. You can see that in adding up those columns, there are significant repeat offenders who seem to keep coming back into the system and causing problems for all the good doctors.

 

I wanted to address the nursing homes. When we defined provider of medical care, it said licensed hospitals, and I think the content was that nursing homes would be included, and since nursing homes hire nurses and physicians, they are clearly covered by A.B. No. 1 of the 18th Special Session as well as anything contained in S.B. 97.

 

Senator Washington:

You mentioned earlier, the Senate Committee on Commerce and Labor hearing on the insurance aspect, and I know insurance matters are not a part of our jurisdiction, but I believe it would be helpful to this committee if you would keep us apprised of what is happening in that committee on the insurance part of this issue. Based on the charts you have submitted, the verdict that was awarded because the defense decided not to settle will have a significant influence on how we ultimately construct S.B. 97.

 

Mr. Bradley:

I will. I am happy to keep the committee apprised of what is happening in the Senate Committee on Commerce and Labor on this issue, because it is very important.

 

Kerry Earley, Attorney, Keep Our Doctors In Nevada:

I am a doctor, but I am a Juris Doctor. I am a defense attorney, and have specialized in medical malpractice for over 20 years. I have defended doctors, paramedics, nurses, and other health care providers. I want to bring a nuts‑and‑bolts mentality to this hearing, because I am the one who goes to the courtroom when Mr. Bradley and his colleagues bring cases to trial. I appear for catastrophic injury cases, brain injury cases, death of a child, and those types of cases. What I bring and would like to help with is the perspective of what the collateral source in tort reform actually means and how that can change or not change things. Also, what it means on the cap, what the exceptions can mean, having exceptions on gross negligence, and so forth. I have never in all my years seen a doctor, a nurse, a physical therapist come and say, “I want to intentionally hurt my patient today.”

 

Malpractice cases are about clinical judgment. The problem with the exceptional circumstances currently included in the caps is there are no criteria for the judges to follow when making their decisions. The issues I am interested in are periodic payments, the collateral source, the cap, which is not a true cap; it is per plaintiff and per defendant. In a wrongful death case, if there were six children and a wife, it would be seven times $350,000. I got a complaint yesterday with 18 people named. What I perceive as the problem is, each of those defendants has a $350,000 cap. As far as waiting to see if A.B. No. 1 of the 18th Special Session works, we are already waiting to see if it works. Assembly Bill No. 1 of the 18th Special Session, for all the provisions we need, only starts when the cause of action accrued October 1, 2002. For all the cases currently in the system, there is no tort reform. Those cases will play out in the next 2 years.

 

I have a labor and delivery case. What my experts say is this child had what is called thrombocytopenia, which is a bleeding condition. The child’s platelets were incompatible with the mother’s platelets. When the child was born, he had severe bleeding in his brain, which caused severe brain damage. The plaintiffs are seeking $27 million in future care and costs. That is all economic. It has nothing to do with a cap, but is straight economic costs that will go to a jury. I have experts at University of California, San Francisco, who say there is no way it has anything to do with something happening during labor and delivery. In that case, my doctor is terrified because if he is wrong, he is facing a $27 million economic verdict, not counting pain and suffering, which could be $8 million to $12 million. Doctors are afraid to defend themselves. They cannot afford to, even if they believe they did nothing wrong. In this case, experts said it was not the doctor’s fault. Rather than face trial and risk a huge financial award against them, doctors pay the $1 million of their policy limit. If doctors pay the $1 million policy limit time after time, the premiums go up, and it removes the doctors’ option to defend themselves.

 

I tried an emergency room case of a nurse in which the doctor believed the nurse did nothing wrong, but the doctor paid the $1 million to settle the case and move on. The nurse gave her consent, the insurance company paid the $1 million within a day, and she now works in an emergency room in Sacramento, California. She is no longer in Las Vegas. That is the flip side of what is happening. I know there is a reasonable middle ground, and that is where we need to go. I would like to be an advocate for the doctors. I see what it does to them. Experts come in from someplace else and say, “I would have done it differently.” They make judgment calls. I wanted to testify today to give balance to this issue, and I would like to help the committee work on S.B. 97.

 

Chairman Amodei:

To the extent the areas you have identified, and that I have requested Mr. Bradley to assist with, are areas that have the potential to impact medical malpractice insurance premium rates; that is information I believe important to the committee to decide what, if anything, to do in the context of in addition to what was done in the 18th Special Session, we would appreciate receiving information from you and Mr. Bradley the day before the committee hearing, to give committee members a chance to review it before the hearing.

Senator Washington:

Could you tell us, from your perspective, how the consent clause actually works and why it is not adhered to when the doctor consents?

 

Ms. Early:

As Mr. Bradley said, you as the attorney, when faced with exposure of $27 million, have to tell the doctor it is in his best interest to consent when his policy is $1 million. When the insurance company chooses not to pay the $1 million, it is then the doctor’s dollar when it goes to trial for anything above $1 million. The problem is that verdict is held against the doctor when he does privileges at any hospital, when he asks to get on any insurance company; it is a personal verdict.

 

Senator Washington:

Is there anything we can do as policymakers to ensure once that consent is given it is the insurance company’s responsibility, and the doctor’s reputation will remain intact?

 

Ms. Early:

I will give that some thought, because it is a problem for doctors.

 

Senator Titus

I have a question for staff. If we do all this, and we come with a new, amended S.B. 97, and we continue to work on this and Mr. Gobel’s bill, and we come out this session with something different from I.P. 1 that will be on the ballot, and it passes, will all we have done be for naught?

 

Chairman Amodei:

I am not staff, but speaking from a non-staff perspective, I think it will impact what I decide to do on this measure by what I see from the medical community and the legal community in terms of Supreme Court cases and ballot questions, and that sort of thing. If it looks like, regardless of what we do, this will be something very much in flux in terms of another branch of the government and elections, that is something we should take into consideration before we attempt to revisit this in a meaningful way. Under one of the tabs in the Work Session document, “Medical Malpractice Background Information (Original submitted as Exhibit F in the Senate Committee on Judiciary Minutes, dated March 5, 2003), there is a write-up on the procedure in terms of the initiative petition.

 

Mr. Anthony, if you will get together with Senator Titus and see if she has anything for which the committee needs more specific direction on the potential matrix of S.B. 97, I would appreciate it.

 

Senator Washington:

I appreciate the question from Senator Titus in your comments, but I am wondering if it is not prudent on our part to at least, as Legislators, fashion something that is going to be beneficial, policy-wise, not only to the consumer but to those parties of interest that we continue to proceed down this path, whether or not we get credit for it, and whether or not I.P. 1 is approved by the voters. In my opinion, we will have done what is right and responsible before the voters. When my tenure is done, I would like to believe we at least did something. We took the facts and fashioned something beneficial to the State of Nevada as a whole.

 

Senator Titus:

One of the things we have heard is the need for stability and consistency in being able to plan insurance rates based on experience. My concern is we have all the cases pending that were under the law prior to the 18th Special Session, and we will have pending cases under law enacted by the 18th Special Session. We will also have cases pending under some law we enact during this session. Then we will have cases pending under the law enacted by the I.P. 1, if the voters approve it. We will have four kinds of cases, and no experience on which to build a record of how to come up with rates. The whole goal was to lower insurance rates. I see that as being counterproductive.

 

Chairman Amodei:

I would submit your analysis is not unreasonable.

 

We will be in recess for purposes of S.B. 97 until March 25, and this meeting is adjourned at 11:08 a.m.

 

 

RESPECTFULLY SUBMITTED:

 

 

 

                                                           

Jo Greenslate,

Committee Secretary

 

 

APPROVED BY:

 

 

 

                                                                                         

Senator Mark E. Amodei, Chairman

 

 

DATE: