Career: Attorney | Bingham, Sakai Mimura Aizwaya – Foreign Law Joint Enterprises | Tokyo, Japan
Towards a No-Fault Compensation System for Medical Accidents in Japan
How the legal system handles the seemingly ever-increasing number of medical malpractice lawsuits is a growing concern in Japan as well as America. Though doctors have argued that Japan has reached a “crisis of medicine” on this front similar to the United States, reaction from the legal establishment in the two countries has been strikingly different.
First, it is important to understand the nature of the medical experience itself. Medical interventions such as surgical operations inherently involve risk to the human body, and some unfortunate outcomes are unavoidable or unforeseeable at the time of operation. However, these unfortunate results might be more avoidable if the causes of the accidents were investigated, analyzed and made known to the wider medical community, particularly the relevant doctors, rather than being legally hushed up in fear of further exposure to liability. Unfortunately, as the law currently stands, the pursuit of compensation through tort law takes a more reactive than preventative or preemptive approach.
In cases involving such patients, lawyers are rightly focused on their own clients, hoping that by financially punishing the doctors, the doctors will be motivated to improve their methods. However, the opposite has actually proven to be true. Lawsuits have had a chilling effect on surgery, and doctors’ liability insurance has predictably skyrocketed to cover the endless parade of lawsuits. This increases costs for everyone. But
without a more public disclosure of the issues, doctors are condemned to repeat the same errors, and patients are condemned to be exposed to the same risk of unhappy outcomes.
The motivation behind an approach that analyzes and seeks to improve medical procedures for future patients is particularly relevant for patients whose medical accidents were the product of no-fault claims. Under the current regime, these victims cannot even be compensated even though their injuries may be as serious as injuries caused under non-no-fault claims.
America attempted to address this problem with its Tort Reform Bill in the 1970s. Many states introduced limits for damages and limits for lawyers’ contingency fees, or they instituted mandatory panel screening before the filing of individual lawsuits. The problem of preventing future medical accidents was left to be solved by individual hospitals under various programs such as a peer review system.
Japan, however, has taken another approach to deal with the problem of skyrocketing medical costs. Recognizing that the threat of lawsuits against doctors may have caused a decrease in the number of doctors, especially obstetricians, the Ministry of Health, Labor and Welfare launched a no-fault compensation system in 2009 for severe cerebral palsy caused during childbirth delivery accidents. This compensation system is mandatory for obstetric institutions and the budget comes from national medical insurance rather than the coffers of the hospital itself. Whether cerebral palsy of newborn babies results from the fault of the doctor or not, this system provides a maximum of $375,000 per child until that child reaches 20 years of age.
While it is a good beginning, this only addresses half the problem. As stated earlier, the problem is not simply skyrocketing costs, but also improving medical practice over time. Compensating only the damage of those children who have cerebral palsy due to delivery error doesn’t solve the larger general issue of incentivizing doctors to learn from their errors. On the contrary, this system almost incentivizes a doctor’s indifference, by minimizing their legal exposure for error.
I would argue that what is required is a new approach that analyzes the causes of medical accidents, gives feedback in analytical reports to medical institutions in which the children with cerebral palsy were born and accumulates and distributes data for prevention of similar accidents moving forward. However, doctors have been resistant. During the course of discussion regarding such an approach, there was strong opposition from doctors who argued that the feedback of analytical reports to patients without immunizing doctors from lawsuits would simply lead to even more lawsuits. They argued that parents could potentially use analytical reports to prove doctors’ fault and that they could also use money they received as compensation for attorneys’ fees, obtaining yet more money through an additional lawsuit.
However, one of the primary hopes of parents of these children is to know what caused their children’s disability and to make sure that if it was due to an accident, it will not happen to others in the future. If they don’t get this feedback, this goal will never be realized. Ultimately, the parties to these negotiations agreed that parents of affected children should receive analytical reports without immunizing the physicians from lawsuits and that the independent committee making these reports would never be at fault in legal terms.
Since this system was launched in 2009, it seems that this compensation system has been working relatively well, although the number of children who have been compensated is still small. However, there are still issues at stake in the future, such as dealing with serious fault cases in which the larger operating institution must seek further reimbursement from the guilty medical institutions or doctors. This system currently applies only to children with severe cerebral palsy from childbirth delivery, and the Japanese government is now having discussions about establishing a broader no-fault compensation system for medical accidents in all areas of medicine. It will not be easy to establish such a system, especially when
one considers the financial burden, as well as the manpower for running the independent committees to provide analysis, as well as the vast array of possible medical accidents. Time will tell whether such an approach can bring down the rates of such medical errors and effectively control malpractice costs. However, it is at least an effort at address the problem, and if proven effective, countries with similar concerns, such as the United States, would do well to consider it more closely.