Chapter 24 Tort Reform © 2014 Jones and Bartlett Publishers LEARNING OBJECTIVES • Describe the meaning of defensive medicine. • Describe various programs designed to lower the cost of malpractice insurance. • Describe the various ways to manage and reduce the number of negligence claims. © 2014 Jones and Bartlett Publishers Reducing Costs & Risks – I • Arbitration & Mediation • Structured Awards • Pretrial Screening Panels • Collateral Source Rule © 2014 Jones and Bartlett Publishers Reducing Costs & Risks – II • Contingency Fee Limitations • Countersuits & Frivolous Claims • Joint & Several Liability • Malpractice Liability CAPS © 2014 Jones and Bartlett Publishers Reducing Costs & Risks – III • No-Fault System • Regulation of Insurance Practices • Physician Participation in Tort Reform © 2014 Jones and Bartlett Publishers The Answer - I • Malpractice Crisis Continues • Many Approaches – No “One” Proven Resolution • Will Require Variety of Reforms © 2014 Jones and Bartlett Publishers The Answer - II • Need to Include all in the Solution – Caregivers – Providers – Insurers – Private Industry – Regulatory Bodies © 2014 Jones and Bartlett Publishers Review Questions 1. Describe the various ways to reduce high malpractice awards. 2. Should there be limits placed on malpractice awards? Support your opinion. 2. How does a structured award work? 3. Which of the schemes for tort reform discussed previously do you consider most helpful in addressing the malpractice insurance crisis? © 2014 Jones and Bartlett Publishers Chapter 23 Employee Rights and Responsibilities LEARNING OBJECTIVES • Describe and understand the rights of employees. • Describe and understand the responsibilities of employees. • Explain what professionals can do to improve professional relationships between one another, as well as between caregivers and patients. Employee Rights - I • Equal Pay for Equal Work • Refuse to participate in care vs. Patient Rights – pharmacist refusal to fill a prescriptions • Question patient care – Suggest Changing Physicians • Freedom from sexual harassment • Treated with dignity and respect Employee Rights - II • Privacy and confidentiality • Whistle-blowing • Freedom from intimidation • Privacy Rights Employee Responsibilities - I • Compassion • Patient advocacy • Honor patient wishes • Maintain confidentiality • Adhere to Safe Practice – Comply with sterile technique protocols Employee Responsibilities - II • Adhere to Professional Standards • Protect Patients from Harm • Maintain Professional Relationships • Maintain employee privacy and confidentiality • Report unethical behavior • Participate in Continuing Education Helpful Advice - I • Do not blame others for your mistakes. • Do not say: “We are short staffed” • Do not say that the physician is not present when he or she is. • Do not say the physician will soon be h.

1. Chapter 24
Tort Reform
© 2014 Jones and Bartlett Publishers
LEARNING OBJECTIVES
• Describe the meaning of defensive medicine.
• Describe various programs designed to lower
the cost of malpractice insurance.
• Describe the various ways to manage and
reduce the number of negligence claims.
© 2014 Jones and Bartlett Publishers
Reducing Costs & Risks – I
• Arbitration & Mediation
• Structured Awards
• Pretrial Screening Panels

2. • Collateral Source Rule
© 2014 Jones and Bartlett Publishers
Reducing Costs & Risks – II
• Contingency Fee Limitations
• Countersuits & Frivolous Claims
• Joint & Several Liability
• Malpractice Liability CAPS
© 2014 Jones and Bartlett Publishers
Reducing Costs & Risks – III
• No-Fault System
• Regulation of Insurance Practices
• Physician Participation in Tort Reform
© 2014 Jones and Bartlett Publishers
The Answer - I
• Malpractice Crisis Continues

3. • Many Approaches – No “One” Proven
Resolution
• Will Require Variety of Reforms
© 2014 Jones and Bartlett Publishers
The Answer - II
• Need to Include all in the
Solution
– Caregivers
– Providers
– Insurers
– Private Industry
– Regulatory Bodies
© 2014 Jones and Bartlett Publishers

4. Review Questions
1. Describe the various ways to reduce high
malpractice awards.
2. Should there be limits placed on malpractice
awards? Support your opinion.
2. How does a structured award work?
3. Which of the schemes for tort reform
discussed previously do you consider most
helpful in addressing the malpractice
insurance crisis?
© 2014 Jones and Bartlett Publishers
Chapter 23

5. Employee Rights and
Responsibilities
LEARNING OBJECTIVES
• Describe and understand the rights of
employees.
• Describe and understand the responsibilities
of employees.
• Explain what professionals can do to improve
professional relationships between one
another, as well as between caregivers and
patients.
Employee Rights - I
• Equal Pay for Equal Work

6. • Refuse to participate in care vs. Patient Rights
– pharmacist refusal to fill a prescriptions
• Question patient care
– Suggest Changing Physicians
• Freedom from sexual harassment
• Treated with dignity and respect
Employee Rights - II
• Privacy and confidentiality
• Whistle-blowing
• Freedom from intimidation
• Privacy Rights

7. Employee Responsibilities - I
• Compassion
• Patient advocacy
• Honor patient wishes
• Maintain confidentiality
• Adhere to Safe Practice
– Comply with sterile technique protocols
Employee Responsibilities - II
• Adhere to Professional Standards
• Protect Patients from Harm
• Maintain Professional Relationships

8. • Maintain employee privacy and confidentiality
• Report unethical behavior
• Participate in Continuing Education
Helpful Advice - I
• Do not blame others for your mistakes.
• Do not say: “We are short staffed”
• Do not say that the physician is not present when he
or she is.
• Do not say the physician will soon be here when he
or she has already left the building.
• Do not say that this will not hurt, when you know it
will.
• Do not say that you are busy when you are not

9. • Take responsibility for caring and communicating.
Helpful Advice - II
• Include the patient in the decision-making process.
• Take the time to explain to patients the risks,
benefits, & alternatives to each course of treatment.
• Avoid the paternalistic approach to medical care
• Be careful not to get anxious, for example, because
of time constraints and thus push the patient into
making hasty and sometimes regretted decisions.
• Show respect and sensitivity to a patient’s needs.
• Show that you value the patient’s decisions.
Helpful Advice - III

10. • Accept and honor the fact that the patient has his or
own needs and desires.
• Assure the patient that you will honor his or her care
decisions in compliance with law.
• Listen to what the patient is saying without
interruption.
• Do not make fun of a patient’s decision-making
capacity. Patients are human and have the frailties
that we all must someday endure.
• Concentrate on the patient’s wishes and instructions.
Helpful Advice – IV
• Be firm but polite when others attempt to speak for
the patient.
• Honor the patient’s wishes.
• Prohibit those who would demean and criticize a

11. patient’s wishes because of his or her frail condition.
• Remember that your feelings & those of the family
may be different than the feelings of the patient.
However, it is the patient who faces the
consequences of his or her decisions. Protect the
patient’s wishes.
Helpful Advice - VI
• Avoid the pitfalls of prejudice and bias.
• Ensure that medical information is only
accessed as required for treatment and
facilitating payment claim.
THE CAREGIVER’S PLEDGE – I
• I will be compassionate.
• I will not neglect my duties and responsibilities.

12. • I will read instructions and follow protocols.
• I will seek verification of questionable orders.
• I will report concerns for patient safety.
• I will not assume responsibility beyond my capability.
• I will call for help when a patient’s medical needs
suddenly change.
• I will continuously improve my skills and participate in
continuing education opportunities.
Review Questions
1. Describe the rights of employees.
2. Describe the responsibilities of employees.
3. Describe what advice you would give new
employees.

13. Chapter 22
Employment-At-Will
& Discharge
LEARNING OBJECTIVES – I
• Discuss the “Employment at Will” doctrine.
• Explain public policies that protect employees from
unlawful discharge.
• Describe what is meant by retaliatory discharge and
how to defend a claim for unfair discharge.
• Describe under what circumstances employers often

14. discharge an employee.
• Describe effective hiring practices and the
importance of clear communications.
Employment-at-Will
• Doctrine
– Employment is at will of employer or
employee
• Employment may be terminated
– at any time
– for any or no reason
• unless a contract in place specifying
terms & duration of employment

15. An at will prerogative without limits could be
suffered only in an anarchy, and there not for long; it
certainly cannot be suffered in a society such as ours
without weakening the bond of counter balancing
rights and obligations that holds such societies
together.
−Sides v. Duke Hospital
Employment-at-Will – II
• Historically
– termination of for any reason widely accepted.
• Growing trend toward a restricted application
of the at-will employment rule whereby right
of an employer to discharge at-will employee
without cause
– limited by either public policy considerations
– or implied covenant of good faith & fair dealing.

16. Employment-at-Will – III
• Fairly balancing rights of employee & needs of
organization complex objective
• Chapter provides direction in balancing act
rights
Employment-at-Will – IV
• Embroiled in combination of legislative
enactments & judicial decisions.
• Some states more employer oriented.
– e.g., New York
• Other states in harmony with constitutional
rights of employee.

17. – e.g., California
A Civilized State
“obvious and indisputable fact that in a civilized state
where reciprocal legal rights & duties abound, the words
"at will" can never mean "without limit or qualification,"
as so much of the discussion and the briefs of the
defendants imply; for in such a state the rights of each
person are necessarily & inherently limited by the rights
of others & the interests of the public. An at will
prerogative without limits could be suffered only in an
anarchy . . . .
−Sides v. Duke Hosp.
Public Policy Issues – I
• Public policy originates with legislative
enactments.

18. • Public policy exceptions to the employment-
at-will doctrine
– employees may not be terminated for
reasons contrary to public policy (see next
two slides)
Public Policy Issues – II
• Disability
• Age
• Race
• Color
• Religion
• Sex
• National origin
• Pregnancy
Public Policy Issues – III
• Union Membership

19. • Filing of safety violation complaints
– e.g., OSHA
• Whistle-blowing
– Whistle-Blower Suit Untimely
– Text Case: Paving Her Way to Heaven
• Reporting patient abuse
– Elder abuse
– Child abuse
Public Policy Issues – VI
“It can be said that public policy concerns what
is right and just and what affects the citizens
of the state collectively. It is to be found in the
states constitution and statutes and, when

20. they are silent, in its judicial decisions.”
−Palmateer v. International Harvester Co.
Employment Issues
• Retaliatory Discharge
– Cannot be used as a means of oppression
– employer does not enjoy an absolute or
totally unfettered right to discharge even an
at-will employee.
• Fairness the Ultimate Test
– Defending a Claim of Unfair Discharge
Termination – I
• Employment Disclaimers

21. – denial of a right that is imputed to a person or
that is alleged to belong to him or her
• Termination for Cause
• Termination and Financial Necessity
• Hostile Attitude
• Poor Work Performance
• Alcoholism
• Insubordinate Behavior
Defending
Wrongful Termination Case – I
• Meeting minutes
• Written reports, typed or handwritten
• Personnel file
• Tapes

22. • Letters, cards, and handwritten notes
• Personnel handbook
• Personnel and departmental policies and procedures
books
• Oral testimony from fellow employees and
supervisors
Constructive Discharge
• Work environment where an employee is
pushed to quit a job
– employer has made working conditions
intolerable
• Employee must prove
1.working conditions were constructively made
intolerable
2.continuous pattern of employer misconduct

23. 3.any reasonable person would or did resign
Termination Questions to Ask – I
• Was there a violation of public policy?
• Was discharge being retaliatory in nature?
• Was there a refusal to perform an illegal act?
• Was the employee questioning a management
practice?
• Was termination arbitrary and capricious
decision?
Termination Questions to Ask – II
• Was there a violation of any contract, oral or
written?

24. – consistent with the reasons for discharge?
• Was there discrimination against the employee
for filing a lawsuit?
• Was there interference with an employee’s rights
as secured by the laws or Constitution of the
United States (e.g., right to freedom of speech)?
Termination Questions to Ask – III
• Was termination fixed?
– don’t confuse me with the facts
• “I’ve made up my mind!”
– foregone conclusion
– before any appeal actions can be taken

25. Effective Hiring Practices – I
• Clear Policies & Procedures
– hiring
– disciplining
– terminating
• P & Ps & Handbooks
– reserve right to add, delete, revise
• Application
• Background checks
Effective Hiring Practices – II
• Familiarity with state laws
• Interviews

26. – human resources
– Supervisor
• References
– follow up with a telephone reference
• Employee handbook & job description
– document employee read, & understood
handbook & job description
Effective Hiring Practices – III
• Constructive performance evaluations
• Progressive disciplinary action policy
• In-service education programs
– interviewing techniques
– performance evaluations

27. – disciplinary actions
• Contract language
CLEAR COMMUNICATIONS
• Communicate clearly to prospective
employees
– employment is at will
– employment can be terminated at any time
• Handbooks & personnel manuals
– fair & unambiguous standards
REVIEW QUESTIONS – I
1. Discuss the employment at-will doctrine.

28. 2. Is employment-at-will doctrine appropriate in
today's society? Discuss your answer.
3. What are public policy exceptions to
employment-at-will doctrine?
REVIEW QUESTIONS – II
4. Discuss questions employer should ask prior
to discharging an employee.
5. What approach might you take in defending a
case for wrongful discharge?
6. Discuss what hiring practices an employer
can put into action to help reduce necessity
for discharging an employee.

29. Chapter 21
Labor Relations
LEARNING OBJECTIVES
• Explain the various federal and state labor acts.
• Discuss the rights and responsibilities of unions
and management.
• Describe the purpose of an “Affirmative Action
Plan.”
• Describe a patient’s rights during labor disputes.
• Discuss the types of discrimination that occur in
the workplace.
Federal & State Labor Laws

30. • Relationships between employees &
employers are regulated by state & federal
laws.
• Federal laws generally take precedence over
state laws when there is conflict between
state & federal laws.
• State laws generally applicable when more
rigid than federal laws.
U.S. Department of Labor
• Cabinet level department
• Functions
– promote welfare of wage earners
– improve working conditions
– advance opportunities for profitable

31. employment
National Labor Relations Act – I
• Enacted 1935 to govern labor-management
relations of business firms engaged in
interstate commerce.
• Act defines certain conduct of employers &
employees as unfair labor practices
– provides for hearings on complaints that
such practices have occurred.
National Labor Relations Act – II
• Act modified by
– Taft-Hartley amendments of 1947
– Landrum-Griffin amendments of 1959

32. National Labor Relations Board – I
• NLRB enforces & administers the NLRA
– has jurisdiction over matters involving
proprietary & not-for-profit health care
organizations.
– agency independent of department of
labor, that is responsible for preventing &
remedying unfair labor practices by
employers & labor organizations.
National Labor Relations Board – II
• Unions & Healthcare Orgs
– Through mid-1930s, little union organizational
• slow growth until late 1950s.

33. – Union activity successful in geographic areas in
which unions have been active in other industries
– Limitations on # of bargaining units
• employees can form up to 8 bargaining units
• upheld by U.S. Supreme Ct.
National Labor Relations Board – III
• Elections
– NLRA sets out procedures by which
employees may select a union as their
collective bargaining representative to
negotiate employment and contract matters.
• Unfair Labor Practices
– Unlawful Interrogation

34. – Failure to Discharge Non-Dues Paying Nurses
Norris-LaGuardia Act
• Aimed at reducing number of injunctions to
restrain strikes & picketing.
• Sets procedures for handling labor disputes.
• Creates board of inquiry if a dispute threatens
to interrupt health care.
• Board’s findings provide framework for
arbitrators’ decisions.
Labor-Management
Reporting & Disclosure Act
• Places controls on labor unions &
relationships between unions & membership.

35. • Requires employers to report payments to
representatives of labor orgs.
• Expenditures made to influence way
employees exercise rights.
• Disclosure of agreements with labor
consultants.
Fair Labor Standards Act
• Establishes
– minimum wages
– maximum hours of employment
– overtime pay provisions
– exempt employees provisions
– work week options

36. Civil Rights Act of 1964
• Prohibits private employers & state & local
governments from discrimination in
employment in any business on basis of:
– race,
– color,
– religion,
– sex, or
– national origin.
OSHA – I
• Sets & enforces safety standards
• Provides training, outreach, & education

37. • Establishes partnerships
• Encourages continual improvement in
workplace safety & health
OSHA – II
• Promulgation & Enforcement of OSHA
Standards
• Recordkeeping
• Education
• Infectious Body Fluids
• Employee Complaints
• State Regulation
• Legal Liability

38. Rehabilitation Act of 1973
• Protection for handicapped employees
• Applied to public & private orgs
• Requirement to perform self-evaluation of
compliance
• Jobs must not be designed to eliminate hiring
of disabled persons
Family and Medical Leave Act – I
• Enacted to grant employees temporary
medical leave under certain circumstances.
• Covered employers must grant eligible
employees up to a total of 12 workweeks of
unpaid leave during any 12-month period.

39. Family and Medical Leave Act – II
• Leave granted for:
– birth & care of employee’s child.
– placement of adopted or foster child with
employee.
– care of immediate family member (spouse,
child, or parent) with a serious health
condition.
– inability to work because of serious health
condition.
Family and Medical Leave Act – III
• Illegal to terminate health insurance coverage
for an employee on FMLA leave.

40. • Following FMLA leave, employee’s job—or an
equivalent job with equivalent pay, benefits, &
other terms & conditions of employment—
must be restored.
State Labor Laws – I
• Laws Vary State to State
– Union Security Contracts and Right-to-Work
Laws
– Wage and Hour Laws
State Labor Laws – Union Security
Contracts
• Closed shop contract
• Union shop contract

41. • Some state statutes forbid such contracts
• Right-to-work laws
• Wage & hour laws
State Labor Laws – III
• Child Labor Acts
– working papers
– forbids employment of minors at night
– prohibits minors from operating certain
machinery
• Workers’ Compensation
– physical injury
– job stress

42. – influenza Vaccination
Labor Rights
• Organize & bargain collectively
• Solicit & distribute union info
• Picket
• Strike
Management Rights
• Receive a strike notice
• Hire replacement workers
• Restrict union activity
• Prohibit union activity during working hrs

43. • Prohibit supervisors from participating union
activity
Patient Rights & labor Disputes
• Patient rights take precedence over labor-
management rights
• Patients have right to
– privacy
– well-being
Affirmative Action Plan – I
• Prohibits discrimination on basis of age, race,
color, religion, sex, national origin.
• Affirmative action program includes

44. – collection & analysis of data on the race and
sex of all applicants for employment.
– non-discrimination clause in manuals.
– use of data to show compliance with the
law.
Affirmative Action Plan – II
• Failure to comply can result in denial of
federal funds.
• Health care orgs should have equal
employment opportunity or affirmative action
plan in place.
Injunctions
• Court order directing that a certain act be

45. performed or not performed.
– Persons who fail to comply with court
orders are said to be in contempt of court.
• Earliest use of injunctions in labor relations
was by employers to stop strikes or picketing
by employees.
• Availability of injunctive relief limited.
Administering
Collective Bargaining Agreement
• Administered in “good faith”
• Supervisors should familiarize themselves with
the agreement
• Importance of recordkeeping
• Grievance procedures

46. • Arbitration
Workplace Discrimination – Age
• Discrimination in Employment Act
• Promotes employment of older persons
• Prima facie case
1.complainant is in a protected age group
2.complainant is qualified for his or her job
3.complainant was discharged
4.discharge occurred in circumstances that give rise
to inference of age discrimination
Workplace Discrimination – Disability
• Americans with Disabilities Act

47. – enacted by Congress to prohibit age
discrimination
• Tips for Employers
– train managers as to ADA requirements
– review & revise job descriptions for compliance
– bring physical environment into compliance
– post notice describing purpose of ADA
Workplace Discrimination – III
• National Origin
• Pay Discrimination
• Pregnancy Discrimination
• Race

48. • Religion
• Sex
Sexual Harassment
• Unwelcomed sexual advance
• Request for sexual favors
• Verbal or physical conduct of a sexual nature
• Creating an environment that is unreasonably
intimidating or offensive
Preventing Sexual Harassment
• Implement an anti-harassment policy.
• Prompt action to prevent & correct any

49. harassment.
• Encourage employees to promptly report
harassment.
REVIEW QUESTIONS – I
1. Provide a general overview of the NLRA.
2. Using the hospital as a setting, give two
examples of what would violate the NLRA.
3. How do patients' rights come into play during
a strike by nurses?
4. What is the purpose of OSHA?
REVIEW QUESTIONS – II
5. Why was the Norris-LaGuardia Act enacted by
Congress?

50. 6. Discuss various ways in which discrimination
can occur in the workplace.
7. What steps can an organization take to
prevent successful lawsuit brought forward on
the basis of sexual harassment.
Chapter 20
Professional Liability Insurance
LEARNING OBJECTIVES
• Describe the purpose of an insurance policy
including risk categories and the importance
of professionals to carry professional liability
insurance.

51. • Explain the elements and conditions of an
insurance policy.
• Describe the investigation and settlement of
claims.
Insurance Policy
• Insurance is a contract that creates legal
obligations on the part of both the insured
and insurer.
– Insurer agrees to assume certain risks of the
insured for consideration or payment of a
premium.
• Insurer promises to pay specific amount of
money if specified event takes place.
Liability Insurance

52. • Purpose of liability insurance is to spread risk
of economic loss among members of a group
who share common risks.
• As risks increase, premiums increase to cover
associated risks.
• Premiums are placed in shared risk fund
– funds are drawn to cover costs of lawsuits.
Elements of Insurance Policy
1. Identification of Risk Covered
2. Specific Amount Payable
3. Specified Occurrence
Risk Categories

53. 1. Property loss or damage
2. Personal injury
1. illness
2. accident
3. Liability
1. professional
Insurance: Policy Types
1. Occurrence
2. Claims-made
3. Tail coverage
4. Umbrella

54. Uninsured Claims
• Intentional Torts
• Criminal Acts
– Child Abuse
– Senior Abuse
– Sexual Assaults
• Fraud
Review Case:
Sexual Assault
1. Does sexual assault generally constitute
rendering professional services within the
coverage provisions of a physician's insurance
policy?

55. 2. Should a malpractice insurer be required to
indemnify a physician for liability resulting
from the sexual assault of a minor?
NO!!!
• Sexual assault does not constitute rendering
professional services within coverage
provisions of a physician's insurance policy.
• The Supreme Court of Nebraska in R.W. v.
Schrein held that sexual assault does not
constitute rendering professional service.
– Five patients claimed they were sexually
assaulted during examination & treatment.
Insurance Policy Conditions
• Notice of Occurrence

56. • Notice of Claim
• Cooperation of the insured
• Co-insurance
• Assignment
• Subrogation
• Cancellation
Liability of the Professional - I
• Need for Insurance: All professionals
– allied health professionals
• insurance relatively inexpensive
• Protect yourself

57. – Don’t practice without insurance
– Prepare for the worst scenario; have no regrets
– Seldom occurrence, but employer could seek
recovery of losses from negligent employee
Liability of the Professional - II
• Volunteer at a clinic or health fair not
sponsored by his or her employer
• Independent contractor providing a service in
a patient’s home
• Worker for an independent agency or registry
Medical Liability Insurance
• Coverage

58. – Malpractice
– Acts or omissions in care
– Coverage varies company to company
Self- Insurance
• Against malpractice risks
– due to high costs of primary coverage
– actuary to determine the proper level of funding
• Purchase excess coverage
Protecting the Organization
• Self-insurance
• Trustee coverage

59. • Mandated medical staff insurance coverage
• Investigation & settlement of claims
Investigation and Settlement
• Duty of insurer to defend insured
• Insurer can settle claims
• Plaintiff/s sign a general release upon
settlement
REVIEW QUESTIONS – I
1. Describe the elements of an insurance policy
2. Describe the conditions of an insurance policy as
described in this chapter.
3. Under what circumstances do you think a health

60. care professional be self-insured?
4. Why do insurance carriers require “timely”
notice of a claim?
5. Describe what occurrences an insurance policy
does not cover.