Secret Memo Found in Hotel Bar

With the current effort to help health care providers avoid full responsibility for their actions gaining steam in our state legislature, it seems appropriate to re-print this post from five years ago, with slight modifications.

I found this memo at an empty corner table in the bar in the basement of the Hermitage Hotel in downtown Nashville, sitting on table next to an empty bottle of Opus and two wine glasses.

To: Tennessee Medical Association  Director for Tort Reform

From: AMA Vice President for Tort Reform

Date February 24, 2011


As we discussed on the telephone, our MFA (Moving for Access) plan will be in full force and effect on July 1, 2011. This memo will give you an overview of MFA; complete details will come in a notebook that has been shipped to you.

Since 1975 we have tried to convince state legislatures around the country that caps on damages will reduce medical malpractice insurance premiums. Some legislators bought this without proof that it would occur, and given what has happened in states that adopted caps we are having some credibility problems. We were afraid that sooner or later legislators will begin to figure out that our members own many of the insurance companies that insure doctors and that the reason for the recent significant increases in malpractice premiums was the failure to have reasonable rate increases during the 1990s, based on the mistaken assumption that our companies would continue to earn high levels of investment income. We were also concerned that sooner or later someone will figure out that as long as medical expenses run over twice the rate of inflation the cost of insuring doctors for malpractice will always increase at a rate above the rate of inflation.  

As you well know,  we now have bigger problems.  Malpractice insurance rates are down and doctor-owned companies like State Volunteer Mutual are making money hand-over-fist.    Indeed, medical malpractice insurance rates for many doctors are less than they were in 1995, after adjusting for ordinary (non-medical) inflation

Therefore, we determined that we needed to develop a new plan to get blood-sucking trial lawyers off our backs. We have done nationwide polling and focus groups in sixteen different states. As a result of those efforts, we have embarked upon to a new plan to motivate state legislatures to enact caps on damages and limit the fees of greedy lawyers (which will make it economically unfeasible to bring cases against our members). The new plan is this: the reason we need caps on damages is because doctors are leaving states without caps on damages and people are being denied access to health care, particularly in rural areas. This resonates with many legislators and with the general public; people are afraid of not having a doctor there when they need one, even if they moved to an area without a doctor. Therefore, this new plan greatly increases our chance of success in the remaining non-cap states, including Tennessee, and our likelihood of preserving caps in states that already have them. Of course, we will continue to depict lawyers as the demons they are – our efforts (and those of the Chamber of Commerce, etc.) over the last 25 years have got that impression firmly imbedded in the minds of the public.

Here is the problem: when asked, we are having difficulty documenting that doctors are actually leaving the practice of medicine or moving to a state with caps. In fact, the number of doctors in states like Tennessee is actually increasing and the only evidence we have that some doctors are leaving is anecdotal. While this will fool some legislators, clearly anyone who approaches the issue with a shred of objectivity will want to see some actual evidence that physicians are leaving a given state, that they are leaving because of the risk of liability in a state without damage caps, and that patients are at risk for harm.

We have encouraged each member state to do a poll of the members to document physician attitudes toward and concerns about litigation, etc. and your state has done one. However, if anyone who understands polling looks at the questions asked and the framework in which the questions were posed they will recognize the effort for what it was: push-polling, plain and simple. Therefore, while we will continue to use our polls, we have determined that more aggressive action is necessary.

So, to get some hard data, we developed "Moving For Access." MFA is a plan to move doctors out of Tennessee and the other forty-nine states. The basic plan is this: a total of 17.9% of the AMA members in Tennessee will have to move to another state. To have doctor flight consistent with our public position, 5.1% of urban doctors must leave and 29.5% of rural doctors must leave (which will result in a total shift of 17.9% of doctors).

In other parts of the country, doctors are being shifted to other states with similar populations. (The exact percentage will differ from state to state to avoid the appearance of concerted effort.) For example, California doctors are going to New York and New York doctors are going to California. Doctors in Montana are moving to North Dakota, and vice versa. However, this will not work in Tennessee. Why? Well, in 1975 we convinced a majority of legislators that Tennessee had a different standard of care that was known only to doctors in contiguous states. If anyone ever figures out that we were shipping Tennessee doctors to Wisconsin and Cheesehead doctors to Tennessee we are at risk of losing not only the caps we hope to get but also all of the restrictions on malpractice suits we won in 1975. (We will also be denied the opportunity to export the "contiguous state rule" to other states.) Therefore, we have adjusted our nationwide plan to accommodate the unique environment in Tennessee; Tennessee doctors will be moved to contiguous states and an equal number of doctors from those states will move to Tennessee.

This plan protects patients, because every doctor will be replaced by another doctor of the same specialty in the same locale. To be sure, some patients will complain about getting a new doctor, but we can blame that on greedy trial lawyers.

Everything will be administered here in Chicago, but undoubtedly you will get calls from your members who have questions about MFA. We have prepared a list of FAQs and responses thereto for your use.

This memo is HIGHLY CONFIDENTIAL. It is for your eyes only. Direct your office to refer all calls from doctors concerning this plan to you.

MFA – Frequently Asked Questions

Q.How was I selected to move?

A.The initial basis for your selection was your location. If there were multiple doctors in your specialty in your location your name was drawn at random thorough a computer program developed with funding received from a federal grant.

Q.When will I be moving?

A.Your actual move date will be July 1, 2011. However, your move will be announced to your local newspaper(s) and your local radio and television station(s) on appropriate dates in advance of your actual move, as determined by the MFA HQ. MFA’s Office of Media Relations will draft the press releases about your move and you will be given a briefing on what to say if you are contacted by the press. (Your briefing will count as Continuing Medical Education credit.) The announcements will start after March 1 to maximize the effect on local legislators in this legislative session.

Q.Why I am moving?

A.You are moving because "you can’t stand the pressure of practicing medicine in a state without caps on non-economic losses and limitations on fees for greedy trial lawyers." You will be given help with this in your Media Relations Training Program, but for the time being you are to repeat this exact phrase to every reporter, legislator, and patient who asks you why you are leaving. Practice it on your spouse and your children until it sounds like you believe it.

Q.What are non-economic losses?

A.Don’t worry about that.

Q.Can I take my family with me?


Q.Do I have to pay my own moving expenses?

A No. Senator Paul sponsored and passed legislation that provides that doctors who move to rural areas during FY 2011 are fully reimbursed for their moving expenses by the federal government.

Q.But I’m been told I am moving to (Atlanta) (Louisville) (Charlotte) (Raleigh-Durham) (Birmingham)!!!!

A.Don’t worry about it – each of those cities is defined as "rural areas" in the Senator’s legislation.

Q.Will I have a job when I move?

A.Yes. You will be set up in medical practice and will have privileges as appropriate at the local hospital.

Q.Where will I live? How will I find a home?

A. The MFA Relocation Office has entered into an exclusive arrangement with a real estate company in each area. Mortgages will be available at prime minus one from a national bank; no qualification is necessary. All loans are guaranteed by the Department of Homeland Security (another component of the legislation described above). You will give MFA HQ a power-of-attorney to either rent or sell your home, as necessary. You will receive all proceeds of renting or selling the property.

Q.Will this move hurt my income?

A.No. Thanks to the generosity of Merck, the income of every doctor who participates in this plan is guaranteed not to drop below his or her 2010 income for the first three years in your new location.

Q.I live in Nashville and I have been told that I have to move to (Hammertoe, Mississippi) (Lizardlick, Arkansas) (Holeaboveground, Virginia)? That is not exactly the lifestyle my spouse and I envisioned when I took up the practice of medicine.

A.Everyone has to make some sacrifices to get greedy trial lawyers out of our lives. However, to make matters easier, Pfizer has agreed to sponsor one trip to the American city of your choice for you, your spouse and children each year to participate in cultural events of your choosing. Also, MFA’s Office of Excessive Consumption has worked out arrangements with all major stores in the nation to send goods to any MFA participant without shipping charges or sales tax. Goods may be viewed through a special Internet portal developed just for MFA members.

Q.I am not concerned about good shopping – I’m concerned about my employees and my patients. What about them?

A.A doctor from another state will be moving in and will take over your practice. That doctor will make sure that your employees continue to work and earn a good living.

Q.Now just a minute. I thought I was moving because I "can’t stand the pressure of practicing medicine in a state without caps on non-economic losses and limitations on fees for greedy trial lawyers." Now you are telling me that I have to move and that someone else will be coming into my office and taking over my practice. Doesn’t that mean that by the time the big shuffle is over there will be the same number of doctors in Tennessee as there was when the big shuffle started?

A.Yes. Actually, there will be more – we will have a bunch of folks coming out of residency programs at the end of June who will begin private practice in Tennessee.

Q.Won’t somebody figure that out?

A.No, not before damage caps are passed and greedy trial lawyers are under price controls. Think about  it – the Tennessee Legislature fell for the notion that the standard of care is different in Cleveland, Ohio than it is in Nashville. Believe us, pulling this off  will be easier than it might appear.

Q.But won’t it be obvious to some number of legislators that this is all a ruse?

A.Oh, some of the bleeding heart liberals under control of greedy trial lawyers will whimper about it. We will deny any wrongdoing. And, we will produce a report from an independent not-for-profit foundation; that report explains that doctors have moved from Tennessee for because it has not adopted necessary tort reform measures and that there is no credible evidence to suggest that it was as a result of a coordinated effort by any organization.

Q.You already have the report?

A.Yes. Hey, we weren’t born yesterday.

Q.Can I ever come back to my home in Tennessee?

A.Not until caps and fee restrictions are passed and the legislation is found to be constitutional. If that occurs, we will try to get you back if funding for this program is still available.

Q.You know, I really don’t like this idea. I think I’ll just stay here.

A.Sorry, you can’t. The last time you paid your dues you agreed to pay $250,000 in liquidated damages if you failed to follow "AMA rules as they are adopted from time to time." This is an AMA rule. You are moving.

Q.I didn’t see that in my dues statement.

A.It was there. On the back. In 4-point type.

Q.I’m not moving – I’ll sue.

A.You can’t. You agreed to binding arbitration. The arbitration will be held before 17 arbitrators, eight chosen by each side and the final arbitrator to be chosen by the 16 designated arbitrators. The arbitration will be held at the Clock Tower Inn in Rockford, Illinois. The loser pays all expenses of arbitration. Our arbitrators are busy; you can get a hearing in about 37 months.

Q.This is an outrage. I am going to the press with this. They will destroy your little plan.

A.No you won’t. You signed a Confidentiality Clause. The liquated damages penalty on it is $500,000. Your spouse signed the same thing on the Auxiliary Membership Renewal, so that tenants by-the-entirety thing does not protect your home. Any dispute over the terms of the Confidentiality Clause is also subject to arbitration, and our lawyer eats pit bulls for lunch. The loser pays and our lawyer charges $580 per hour. And, by the way, our lawyers have told us that a doctor who breaches a confidentiality clause may not be fit to practice medicine.

Q.For an organization that doesn’t like lawyers you sure seem to use them.

A.We like our lawyers.

Q.So, I guess I’m moving.

A.Your cooperation is much appreciated.

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