1. PATIENTS’ COMPENSATION SYSTEM A P ROPOSAL T HAT W ORKS FOR G EORGIANS Presentation to: Joanna M. Shepherd-Bailey, Ph.D. Professor, Emory University School of Law Wayne W. Oliver Executive Director, Patients for Fair Compensation 2655 Northwinds Parkway Alpharetta, GA 30009 877 248 1689 www.patientsforfaircompensation.org © Copyright 2013

2. CURRENT TORT SYSTEM DOES NOT MEETS ITS GOALS 5/15/132655 Northwinds Parkway Alpharetta, GA 30009 877 248 1689 www.patientsforfaircompensation.org © Copyright 2013 2 Three main goals of medical tort system: 1.Deterrence of unsafe practices; 2.Compensation for injured patients; and 3.Corrective justice The current tort system is not accomplishing these goals. If we were designing a new system, it would look nothing like what we have today.

3. CURRENT TORT SYSTEM BROKEN  Prevents Access to Justice Less than 20% of injured patients receive compensation Less than 1% receive Jury Award  Hurdle for Patient Safety Unable to significantly improve under a “Blame & Shame” system…  Promotes Defensive Medicine GALLUP - 26% of overall healthcare costs Cost $14 billion annually to People of Georgia ➔ State Savings: $6.9 billion in Medicaid & SHBP 7/8/132655 Northwinds Parkway Alpharetta, GA 30009 877 248 1689 www.patientsforfaircompensation.org © Copyright 2013 3

4. PHYSICIANS PRACTICING DEFENSIVE MEDICINE (%) U.S. physicians are only ones personally financially liable for malpractice; and the only ones practicing defensive medicine. Source: Pacific Research Survey June 24, 2011 92% 0% 2655 Northwinds Parkway Alpharetta, GA 30009 877 248 1689 www.patientsforfaircompensation.org © Copyright 2013 4

5. PATIENTS’ COMPENSATION SYSTEM HOW DOES IT WORK? 2655 Northwinds Parkway Alpharetta, GA 30009 877 248 1689 www.patientsforfaircompensation.org © Copyright 2013 5 Patient Advocate Medical Review Department Compensation Department Administrative Law Judge Quality Improvement Department Independent Medical Review Panel 1 2 3 4 5 6

6. MORE EFFICIENT USE OF EXISTING FUNDS 3-5 years Patient Compensation System Current System 20% Injured Patients 17.5% Malpractice Costs 180 days 80% Malpractice Costs 100% Injured Patients Source: PIAA, 2011 Report Towers Watson Study, 2011 2655 Northwinds Parkway Alpharetta, GA 30009 877 248 1689 www.patientsforfaircompensation.org © Copyright 2013 6

7. (in millions) Revenue$120 Payments to Patients$24 Paid to Defense Attorneys$25 Other Expenses$25 Investment Income($24) Profit$70 ECONOMIC SCALE OF JUSTICE 4/29/132655 Northwinds Parkway Alpharetta, GA 30009 877 248 1689 www.patientsforfaircompensation.org © Copyright 2013 7 MAG Mutual Average of 5 years ending 2012

8. ECONOMIC SCALE OF JUSTICE (in millions) Revenue$120 Payments to Patients$24 Paid to Defense Attorneys$25 Other Expenses$25 Investment Income($24) Profit$70 Patients: $12M Plaintiff Attorneys: $12M 4/29/132655 Northwinds Parkway Alpharetta, GA 30009 877 248 1689 www.patientsforfaircompensation.org © Copyright 2013 8 MAG Mutual Average of 5 years ending 2012

9. (in millions) Revenue$120 Payments to Patients$24 Paid to Defense Attorneys$25 Other Expenses$25 Investment Income($24) Profit$70 ECONOMIC SCALE OF JUSTICE Patients: $12M Plaintiff Attorneys: $12M Defense Attorneys: $25M 4/29/132655 Northwinds Parkway Alpharetta, GA 30009 877 248 1689 www.patientsforfaircompensation.org © Copyright 2013 9 MAG Mutual Average of 5 years ending 2012

10. (in millions) Revenue$120 Payments to Patients$24 Paid to Defense Attorneys$25 Other Expenses$25 Investment Income($24) Profit$70 ECONOMIC SCALE OF JUSTICE Patients: $12M Plaintiff Attorneys: $12M Defense Attorneys: $25M Insurance Carriers: $70M 4/29/132655 Northwinds Parkway Alpharetta, GA 30009 877 248 1689 www.patientsforfaircompensation.org © Copyright 2013 10 MAG Mutual Average of 5 years ending 2012

11. (in millions) Revenue$120 Payments to Patients$24 Paid to Defense Attorneys$25 Other Expenses$25 Investment Income($24) Profit$70 ECONOMIC SCALE OF JUSTICE Patients: $12M Plaintiff Attorneys: $12M Defense Attorneys: $25M Insurance Carriers: $70M PATIENTS $12 Million 10% MedMal Carriers Trial Attorneys $107 Million 89% 4/29/132655 Northwinds Parkway Alpharetta, GA 30009 877 248 1689 www.patientsforfaircompensation.org © Copyright 2013 11 MAG Mutual Average of 5 years ending 2012

12.  82% of Georgia physicians practice defensive medicine  74% of Georgia physicians believe that defensive medicine negatively impacts patient care  95% of Georgia physicians support PCS Proposal  96% Georgia physicians agree that a PCS solution would reduce healthcare costs WHAT HAVE GEORGIA PHYSICIANS TOLD US? Source: Oppenheim Research January 12, 2012 7/8/132655 Northwinds Parkway Alpharetta, GA 30009 877 248 1689 www.patientsforfaircompensation.org © Copyright 2013 12

13.  Physicians will never get sued again  No personal financial risk  Does NOT assign blame  Safe to admit mistakes  Stress of litigation  Malpractice premiums will decrease … PHYSICIAN BENEFITS 2655 Northwinds Parkway Alpharetta, GA 30009 877 248 1689 www.patientsforfaircompensation.org © Copyright 2013 13

14.  All complaints are reviewed Increases Access to Justice  Faster payment of claims – months vs. years  Eliminates stress of litigation  Reduces exposure to unnecessary tests & copays  Guaranteed award for avoidable medical injury  Increases patient safety efforts  MORE compensation to MORE patients… PATIENT BENEFITS 2655 Northwinds Parkway Alpharetta, GA 30009 877 248 1689 www.patientsforfaircompensation.org © Copyright 2013 14

15. ACTUARIES :: AON and BioScience Valuation with peer review by David Frisvold (Assistant Professor, Department of Economics, Emory University) determined the following  Significant decrease in malpractice & healthcare expenses  Savings to State of Georgia › $3.1 BillionMedicaid › $3.8 BillionState Employee Healthcare Costs $6.9 BillionTotal Savings in First 10 years IMPACT ON GEORGIA 2655 Northwinds Parkway Alpharetta, GA 30009 877 248 1689 www.patientsforfaircompensation.org © Copyright 2013 15

16.  PCS is a Solution to Completely Replace, not Just Reform the Current Tort System No more medical malpractice lawsuits … against doctors, hospitals, nursing homes, pharmacists, nurses, etc. Strong legal precedent Slashes defensive medicine costs Enhances patient safety More efficient use of existing funds At no cost to the taxpayers or the State of Georgia SUMMARY… 2655 Northwinds Parkway Alpharetta, GA 30009 877 248 1689 www.patientsforfaircompensation.org © Copyright 2013 16