Tort Lawyers Driving Nursing Homes Into Bankruptcy

There are attorneys, lawyers, pettifoggers and ambulance chasers. Ken Lewis detests the latter and isn’t all that enamored of the other categories. He is not alone.

Lewis struggles with a problem facing many elderly couples. His wife is seriously ill and requires 24-hour care in South Port’s nursing facility. The cost exceeds $5,200 a month.

As a high-level retired engineer for the Defense Department, his pension is hefty enough to almost pay costs of his wife’s care. The extras, and his own living expenses, come steadily from dwindling savings.

No big complaint about care costs. Old age ain’t for sissies. He is grateful he has a pension large enough – so far – to provide good care for his helpmate of 58 years.

Nonetheless, he was dismayed to receive a notice from South Port in September that its liability insurance policy had been increased by $1.3 million annually – a sudden, 512 percent jump.

Consequently a “surcharge” of $17 per day was added to the monthly statement of each patient of the nursing center. In Lewis’s case, this was another big hit on personal savings.

South Port stated: “We believe the Florida Legislature will be forced to address the insurance crisis during the 2001 legislative session. We urge you to write or call your state legislator and the governor to ask for their help.”

A man of action, Lewis contacted State Rep. Lindsay Harrington, Gov. Jeb Bush and the Sun-Herald. Our Greg Martin explained the problem in a detailed front-page story of Oct. 8.

Harrington is deeply involved in trying to keep open the state’s G. Pierce Wood Memorial Hospital at Arcadia for mentally disturbed patients. Now he has added tort insurance reform to his agenda. However, he is pessimistic.

“We are on the verge of a healthcare catastrophe in Florida,” Harrington declares. “The state budget is nearly a billion dollars in the hole with federally mandated healthcare services. On top of this, we have lawyers loading the system with multi- million-dollar settlement suits.”

Harrington and Lewis suggest there should be an ability-to-pay test for catastrophic healthcare expenses so other members of a primary family can live without hardship.

Gov. Bush stated in a January 12 newsletter: “We are committed to responsible litigation reform. The high cost of Florida insurance premiums are eight times the national average. These are often passed along to our elders or force the closing of some nursing homes altogether.”

The Florida Medical Business trade letter pulls no punches in its October issue: “To many nursing home executives, Tampa attorney James L. Wilkes, Jr., is the devil incarnate. That’s because Wilkes has made a fortune – and spawned a booming trend – by successfully suing nursing homes.”

The publication points out that in addition to splitting settlements, Wilkes “picked up large fees allowed lawyers under Florida statutes.”

FMB contends that Wilkes “has created a sub- industry of lawyers, complete with television ads soliciting wronged, grieving families. The impact comes amid an industry in crises, with about 23 percent of nursing home beds in Florida run by companies that have filed for bankruptcy protection.”

Neither Lewis nor Harrington condem legal redress for damages. Certainly professional providers should be held accountable for neglect or careless mistakes.

At issue is the practice of contingency fees and class-action suits. If a suit fails, the lawyer gets nothing. If he wins he takes up to 40 percent of the awards – often including triple amounts as “punishment” for offenders. In addition, the lawyer gets his usual expenses at hourly fees only he records.

Former Florida Gov. Lawton Chiles and state attorney-general staffer Tim Howard are to blame for the explosion of tort litigation. They got a crew of private lawyers to launch a contingency-fee suit against tobacco companies. The claim was recompense for the state’s share of Federal Medicaid expenses treating patients disabled by smoking.

The court awarded $2.8 billion. The contingency fee was $233 million for each of the private lawyers solicited by Howard. A West Palm Beach judge ruled the fee was “patently ridiculous,” and the lawyers settled for lesser fees kept secret.

Congressman Scott McInnis (R-CO) introduced a bill after the Florida tobacco settlement to limit tort awards. However, the bill died in committee.

The race was on to climb aboard the tort train. Once the tobacco companies were milked dry, the ambulance chasers moved on to asbestos, breast implants and Firestone tires.

When private healthcare facilities have been destroyed, we can brace ourselves for the next victim of attorney greed – perhaps Ken Lewis.

PARTING SHOTS

A contingency fee means that if your lawyer loses, he gets nothing. If he wins, you get nothing.

* * *

In one of Bill Clinton’s farewell speeches, he declared, “I guarantee that no other president has had as much fun as me.” Thanks for the memories, Monica.

Lindsey Williams is a Sun-Herald columnist

Williams – lawyers

Sunday – jan. 21, 2001

6 col head and byline logo for editorial column