New Jersey Healthcare ADR Lawyer & Attorney : Healthcare Neutral : Richard Webb : New York Metropolitan Area

          The current issue of in Re: Magazine, the special supplement to the weekly newspaper, New Jersey Lawyer, is dedicated to healthcare law and is online now.

          In addition to an article by yours truly entitled Alternative Dispute Resolution In The Healthcare Industry, topics covered include:

- Nuances Of Purchasing  A Medical Practice, by Peter A. Greenbaum;

- The Next Wave Of Healthcare Fraud Enforcement In New Jersey, by Mark S. Olinsky and Gary W. Herschman;

- Answering Malpractice Insurance Questionnaires, by Christopher R. Barbrack;

- Medicaid Beneficiaries' Rights Not To be Evicted From Nursing Homes, by William P. Isele; and,

- New IRS Form 990 And Transparency For Nonprofit Boards, by Todd C. Brower and Isai Senthil.

[Image: Newspaper Rock, by Jon Sullivan, February 15, 2004]

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          The American Health Lawyers Association's ADR Service will hold a one day Arbitration Training Session on June 29, 2008 at the San Francisco Marriott Hotel in San Francisco, California.  The session will be held on the day prior to commencement of  the AHLA's Annual Meeting & In-House Counsel Program, although registration for that meeting is not required to attend the Arbitration Training Session.
         
          This training session will be taught by Jerry P. Roscoe, who always does a fine job in covering a lot of ground in an engaging way.  I started my ADR training with AHLA sessions, and found them to be well worth the cost.  For those interested in joining the AHLA's Roster of Dispute Resolvers, this is a great place to begin.

          For a detailed schedule of the training session and to register online, access the AHLA's website.

[Image: San Francisco Cable Car by Thomas Bachmann, July 15, 2004]

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         [Image: View of downtown Seattle from Kerry Park, with Mt. Rainier in the background, by U.S. Geological Survey, October 16, 2005]

         Two weeks ago, I attended the 10th Annual ABA Section of Dispute Resolution Spring Conference in Seattle.  Having dug out from the tasks accumulated during my time away, and with the benefit of some time for reflection, I now turn to writing about a few of the topics covered in some of the break-out sessions I attended at the conference.  On the whole, the conference was excellent, and I have already touched upon some topics (Hall Street, med-arb) that were addressed there is great detail.  In posts to follow, I will share what I learned about:

- mediating cases in which the only issue is money;

- the use of apologies in helping to resolve disputes arising from adverse healthcare outcomes; and,

- what frequent consumers of ADR want and consider to be quality when selecting their neutrals.

          Aside from the sessions discussing these topics and others, the conference offered an opportunity to meet and talk with interesting people from around the country (and beyond) who share a belief in the value of alternative dispute resolution, and who seek to improve the way in which they advance the cause.  For anyone who is serious about ADR, I highly recommend it.

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          [Image: Top view of the two-headed Boa Island Janus figure, County Fermanagh, Northern Ireland, by Kenneth Allen, May 22, 2006]

          Last night I attended a joint meeting of the New Jersey State Bar Association's Dispute Resolution Section and the New Jersey Association of Professional Mediators, at which a presentation and discussion took place concerning the dispute resolution process in which the neutral serves as both a mediator and an arbitrator in the same case - commonly referred to as "med-arb" or "arb-med," depending on the primary process for which the neutral is engaged.  The speakers, Patrick Westerkamp and Sally Steinberg-Brent, entitled their presentation "Mediation and Arbitration, Like Oil and Water?"  They approached the topic in the context of labor arbitrations, including an interesting historical review, and offered examples of how an experienced and trusted labor arbitrator could utilize mediation techniques to settle certain cases with the parties' consent.

          Against this backdrop, the diverse audience of ADR providers in attendance jumped in with spirited discussion of how and why med-arb could (or could never) work in their practices.  Among the strongest objections to the concept were voiced by the family law mediators in attendance, who saw the judgmental role of arbitrator as antithetical to their mediation practices.  Others focused on some practical problems with med-arb: How does the arbitrator maintain objectivity and neutrality after hearing confidential information from the parties in mediation?  What happens if mediation settles some but not all of the issues, and the remaining issues cannot be fairly arbitrated without reopening the settlement?  Are med-arb and arb-med permitted by applicable statutes, codes of ethics and rules of practice?  Time ran out before these issues could be fully explored, but a consensus seemed to emerge that med-arb can be a very helpful tool if used carefully and in appropriate circumstances. 

          In my view, for purposes of resolving common business disputes arising in the healthcare industry, the greatest utility exists in a process that might more accurately be described by the oxymoronic term "binding mediation."  Specifically, after making considerable progress but reaching an impasse, a mediator can, at the request of the parties, offer a "mediator's proposal."  The object of such a proposal is to state the mediator's sense of a fair allocation of the remaining ground between the parties, and not an opinion of how the entire conflict would be resolved in court.  The parties are then presented with this proposal in separate sessions and asked to accept or reject it.  Only if both parties accept it does the mediator reveal their decisions and settle the case.  Otherwise, the mediation is concluded without settlement.

          "Binding mediation" takes this process one step further.  At the point where the parties request a "mediator's proposal,"  they also may agree that they will accept the mediator's proposal as a binding decision.  Again, the mediator does not then offer an arbitral award in the traditional sense, but a solution that equitably resolves the remaining issues in the case, taking into account the prior course of negotiation and scope of available solutions at the time of impasse.  This is, I think, the kind of "med-arb" that  parties at impasse may want from a mediator in whom they have confidence when they cannot bear to leave the mediation without settlement.

          Among other things I learned from many of the courses and discussions I participated in at last week's annual meeting of the ABA Dispute Resolution Section in Seattle, the future of ADR lies in tailoring the process to suit the needs of the parties.  Call it "med-arb," "binding mediation" or something else, it is here to stay.

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 [Image:  A supreme pizza with pepperoni, peppers, olives and mushrooms, by Scott Bauer, USDA]

          Last week, the U. S. Supreme Court decided the much anticipated arbitration case, Hall Street Associates, L.L.C. v. Mattel, Inc., which I first wrote about when it was argued last November.  The question faced by the Court in Hall Street was whether the parties to a dispute governed by the Federal Arbitration Act ("FAA") could, by agreement, provide for more expansive judicial review of the arbitrator's award than the narrow grounds stated in the FAA.  In particular, the case involved an agreement that the federal district court could vacate, modify or correct the arbitrator's award to correct legal or factual error.  The FAA permits an award to be vacated or modified only when it is in excess of the arbitrator's authority, or when it results from fraud or arbitrator misconduct.

          By a 6-3 vote, the Court held that the statutory grounds for vacating or modifying an arbitration award under the FAA are exclusive, and not subject to expansion by agreement of the parties.  The Court thereby resolved a conflict among the circuit courts, and upheld the more "traditional" view of arbitration argued by many, including the American Arbitration Association ("AAA").  This was a good result.  It preserved the essence of the arbitration process under the FAA that makes it an attractive alternative to courtroom litigation.

          But the Court did not slam the lid on all future use of  "enhanced arbitration."  Arbitrations not governed by the FAA may or may not permit the parties to agree upon heightened judicial review, depending on the arbitration statute or rule involved.  Even under the FAA, as noted by the National Arbitration Forum ("NAF"), the possibility remains that parties could expressly agree to require the arbitrator to apply the substantive law governing their underlying dispute.  Thus, the losing party could attempt to challenge the arbitrator's award in court on the grounds that the arbitrator failed to "follow the law," and thereby acted "in excess of the arbitrator's authority."  The distinction between the parties' agreement that (a) the arbitrator's award will be subject to "enhanced judicial review" (a result not allowed under Hall Street) and (b) the arbitrator's award can be vacated for "exceeding the arbitrator's authority" if the arbitrator did not follow the law, is a subtle one, to say the least.  For  a fuller explanation of this theory, see Judge Posner's opinion in a case cited by the NAF, Edstrom Industries, Inc. v. Companion Life Insurance Co., 516 F.3d 546, 550 (7th Cir. 2008).

          What does this mean for the healthcare lawyer and client considering the use of an arbitration agreement?  If you like the idea of "traditional" arbitration, with the scope of discretion, speed and finality that it offers, make your case subject to the FAA and select an arbitrator using rules that are consistent with your expectations.

          If you are not comfortable with that scope of arbitral authority, you could attempt to get your case outside the FAA, expressly require the arbitrator to strictly adhere to the applicable substantive law, and require the arbitrator to issue a reasoned award (including findings of fact and conclusions of law).  Procedural rule 20 D of the NAF provides that an arbitrator "shall follow the applicable substantive law."  This approach may or may not get you the judicial review you want, but it maintains that possibility, and holds the arbitrator to a tighter standard.  It also may slow the process and undercut the finality that traditional arbitration offers.

          Finally, if you can't live without absolute certainty that your case will be reviewed on the merits by a sitting judge, just skip arbitration and go directly to court.  You really didn't want to arbitrate anyway.
 
          The beauty of the Hall Street decision is that it leaves parties with this choice.  You just can't have them all.

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          [Image: World Wrestling Entertainment (WWE) superstar Rikishi performs for the troops at Camp Victory, Baghdad, Iraq, December 20, 2003, by TSGT Lias M. Zunzanyika, USAF]

          Until very recently, I viewed the annual announcement of New Jersey's Super Lawyers with considerable skepticism.  Having practiced law for nearly 30 years with my fair share of success and professional achievement, it seemed to me that any such list that didn't include my name had to be faulty.  All of that changed this week when I was named a New Jersey Super Lawyer in the Health Care category (also published in the April print edition of New Jersey Monthly magazine).  Clearly, the folks over at Super Lawyers have finally gotten the kinks out of the selection process. 

          I don't know what made me a Super Lawyer this year, or why some terrific healthcare lawyers I know have yet to make the list.  But I confess that I'd rather be on the list than not.  I wish I could say that I didn't care, but I do, if only a little.  I also admit that I will buy the plaque commemorating this event.  After all, the selection process may never again be as well-conceived, fairly applied and thorough as it was this year - I will let you know.

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          [Image: The center third of "Education" (1890), a stained glass window by Charles Louis Tiffany and Tiffany Studios, located in Linsley-Chittenden Hall at Yale University.  It depicts Science (personified by Devotion, Labor, Truth, Research and Intuition).]

          Writing in the online ABA Journal, Debra Cassens Weiss picks up on a fascinating story from the Legal Blog Watch by Robert J. Ambrogi on an upcoming Cornell Law Review article called "Blinking on the Bench: How Judges Decide Cases."  The article, written by Chris Guthrie of Vanderbilt Law School, Jeffrey J. Rachlinski of Cornell Law School and U.S. Magistrate Judge Andrew J. Wistrich of the Central District of California, analyzes how trial judges make decisions.
  
          Their thesis rests on the dichotomy between  "deliberative" and "intuitive"  decision-making  processes.  Their conclusion? As quoted by Robert Ambrogi, trial judges "are predominantly intuitive decision makers, and intuitive judgments are often flawed," with the result that "millions of litigants each year might be adversely affected by judicial overreliance on intuition."

          The complete article thoroughly describes the characteristics, advantages and disadvantages of deliberative decision making and intuitive decision making, and then explains the testing done by the authors on 295 Florida trial court judges that forms the basis for their conclusions.  Among those tests were the following questions (try all three before checking the answers at the end of this post, below):

          1- A bat and a ball cost $1.10 in total. The bat costs $1.00 more than the ball. How much does the ball cost?

          2- If it takes five machines five minutes to make five widgets, how long would it take 100 machines to make 100 widgets?

          3- In a lake, there is a patch of lily pads. Every day, the patch doubles in size. If it takes 48 days for the patch to cover the entire lake, how long would it take for the patch to cover half of the lake?

          According to the authors, nearly one-third of the judges failed to answer a single question correctly; nearly one-third of them answered only one question correctly; about one-quarter of them answered  two questions correctly; and roughly one in seven answered all three questions correctly.  How did you do?

          Although the judges' scores were comparable to those of other well educated adults, they illustrate the authors' point: while intuition is quicker and often "feels right," it cannot substitute for a careful deliberative process in reaching just and accurate decisions.

          So what does all this have to do with alternative dispute resolution?  A few things occur to me:

        - The parties to a dispute heading towards litigation need to be realistic about what they an expect from the courts at the end of their case.  They typically cannot select their judge, and their judge probably has far more cases to handle than there are hours in the day - the primary reason the article's authors found for most judges' reliance on an intuitive approach.

        - Alternative dispute resolution processes, whether adjudicative (arbitration, evaluation) or facilitative (mediation, negotiation), inherently permit and encourage a more deliberative approach than a trial court's decision.  Time, attention (and sometimes expertise) are brought to bear on the dispute as needed. 

        - The process of "reality testing" that is a major part of most mediations results in the parties and counsel having to confront the intuitive but unsound aspects of their case, and then reshape it accordingly, while there is still time for a fair settlement.

          Of course, some parties may want an "intuitive" decision-maker, and may be convinced that the prospect of a favorable result in that forum far outweighs the risk of a less than perfect decision.  They may even be correct.  But that is just another factor in the mix of issues and interests to be sorted out.

Answers to the questions above:
1- The correct answer is 5 cents, not 10 cents.
2- The correct answer is five minutes, not 100 minutes.
3- The correct answer is 47 days, not 24 days.

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            [Image: The Turnstiles of Taipei in Xindien Station, by Shack,  June 28, 2007]

          An article posted in Sunday's philly.com by Inquirer Staff Writer Stacey Burling described arbitration as "a growing trend in health care."  In particular, the article focused on the practice of some physicians and other health care providers to condition their willingness to provide services on the patient's signature of an agreement to arbitrate all disputes (including malpractice claims) arising out of the physician-patient relationship.  Sometimes the agreement will place limits on the nature and amount of damages that can be recovered in a malpractice action.
          One patient interviewed for the article said she could never use a physician who required such an agreement because that physician had "already set the tone" of their relationship to be one of "adversaries before we even know each other."  I suspect this feeling may be widespread, although that says more about most people's assumptions concerning litigation and alternatives to litigation than anything else. 
          How would patients feel about entering a doctor's office for the first time and having to ask that doctor to sign a form that said something like this: "I [physician] agree that you [patient] reserve the right to hire a lawyer on a contingent fee basis to sue me in court for unlimited damages in the event you are in any way unhappy with my services, and that your claim will be decided by a small group of strangers who have no training in the law or medicine and will be final and binding upon me."  Sets a nice tone, doesn't it?
          As one doctor interviewed for the article said, he started requiring an arbitration agreement as a precondition to taking on new patients to "somehow create malpractice reform for myself since it wasn't coming from the courts and it wasn't coming from the legislature."
          If you assume that the creation of the doctor-patient relationship is a free choice for both parties, why shouldn't those parties be free to decide how disputes that arise in the course of their relationship will be resolved?  To be sure, there is potential for overreaching and abuse here, but nothing that can't be overcome.  Such agreements can't be forced upon patients who are in the middle of an emergent or life threatening condition; they can't require unreasonable venue, costs or other procedural rules; they can't be unclear, ambiguous or unduly complicated; they must be reciprocal;  and they must not so diminish the patient's substantive rights to relief as to be "unconscionable". 
          The idea that such agreements are so inherently unfair and inconsistent with our society's values that they must be judicially stricken, or legislatively outlawed, rests on a  fundamental mistrust  of appropriate alternatives to courtroom litigation that has long been debunked.
          I don't know how I would react to my doctor requiring me to sign an arbitration agreement.  I'd like to think I would listen to his explanation of why he wants it, I would read it, and I would make my decision as to what it says about him and our relationship.  But that would be between us.

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             [Image: A view of Inner Temple Gardens, London, The Lud, 10-03-2006]

            Two months ago, I posted on the then pending oral argument in Hall Street Associates, L.L.C. v. Mattel, Inc.,  calling it "the most important ADR case of the year."  The case raises the question of whether parties can, by agreement, expand the scope of judicial review of an arbitration award beyond the grounds stated in the Federal Arbitration Act. Last week, I was able to attend the monthly meeting of the Justice Marie Garibaldi Inn of Court for Alternative Dispute Resolution, at which there was a wonderful presentation on the case and the oral argument before the Supreme Court.  The Garibaldi Inn of Court, named in honor of retired New Jersey Supreme Court Justice Marie Garibaldi, is one of the American Inns of Court, and may be the only one devoted to alternative dispute resolution. 
            The American Inns of Court are loosely modeled after the traditional English Inns of Court (Gray's Inn, Lincoln's Inn, Inner Temple and Middle Temple), and are "designed to improve the skills, professionalism and ethics of the bench and bar.  An American Inn of Court is an amalgam of judges, lawyers, and in some cases, law professors and law students. Each Inn meets approximately once a month both to 'break bread' and to hold programs and discussions on matters of ethics, skills and professionalism."
            At last week's program, New Jersey attorney and neutral John R. Holsinger provided an excellent procedural history of Hall Street and framed the issues now before the Supreme Court.  The Inn then heard from Eric P. Tuchmann, General Counsel of the American Arbitration Association, who submitted a brief on behalf of the AAA as amicus curiae, and who attended the oral argument.  It was fascinating to hear not only which Justices asked questions, but what each of them appeared to be thinking about how the resolution of Hall Street should be approached.  The consensus of opinion?  As other commentators have said, this one is tough to predict.  There is room for the Court to rule for either party, or to avoid the main issue entirely. 
           It was a rare evening.  In the company of active and retired New Jersey jurists of note and leading ADR practitioners, I was listening to a discussion of a Supreme Court case I had covered, being led by someone involved in that case.  It was everything that the Inns of Court are supposed to be, and I was grateful to be a part of it.  A special note of gratitude goes out to Robert E. Margulies, an officer of the Inn and New Jersey attorney and neutral, for inviting me into the Inn's membership last year.  Membership in an Inn of Court can restore one's faith in the professionalism that should be fundamental to the practice of law.  I highly recommend it.

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             [Image: "Happy New Year To You", a 1908 postcard with artwork showing a frog holding a bottle of champagne with the cork popping.]

            Happy New Year!  I return to blogging after some time off for the holidays and to get my new business life in order.
            Thank you to Christina Doucet, Communications Specialist at the National Arbitration Forum, for bringing to my attention that four of the eighteen ADR cases identified as "most significant" by the Forum's 2007 ADR Law & Policy Year in Review are healthcare arbitration cases.  Significantly, all four of these decisions affirm the enforceability of arbitration agreements in cases of alleged medical malpractice or mistreatment of patients by a healthcare facility.  The cases are Reigelsperger v. Siller, 150 P.3d 764 (Cal. 2007), Covenant Health Rehab of Picayune, L.P. v. Brown, 949 So. 2d 732 (Miss. 2007), Hogan v. Country Villa Health Services, 55 Cal. Rptr. 3d 450 (Cal. Ct. App. 2007), and Owens v. National Health Corp., No. M2005-01272-SC-R11-CV, 2007 WL 3284669 (Tenn. Nov. 8, 2007).
            It will be interesting to see if cases decided in 2008 follow this pattern.  Even more interesting will be the success of certain legislative efforts (such as the "Arbitration Fairness Act of 2007") now being directed at protecting consumers from pre-dispute arbitration contracts - and which no doubt will be applied to patient/resident complaints such as those in the cases cited by the Forum.  Stay tuned.

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         [Image: Omaha jazz great Lewis "Luigi" Waites plays the vibraphone during a tribute to Duke Ellington, July 29, 1999, Photo by Jim Williams, for "Joselyn Art Museum: Jazz on the Green," a Nebraska Local Legacies project]

         I just heard from Debra Gerardi, Chair of the Program on Healthcare Collaboration and Conflict Resolution at the Werner Institute for Negotiation and Dispute Resolution at Creighton University.  Debra alerted me to an upcoming program at the Werner Institute that should be considered by anyone interested in healthcare dispute resolution.  Creating Cultures of Engagement in Health Care - International Conference and Dialogue: New Models for Addressing Conflict, Disruption and Avoidance in Health Care, will be held at Creighton in Omaha on June 3-5, 2008.

        As stated in the program description on the Werner Institute's website, the purpose of the conference is to provide participants with an opportunity to:

1. Learn how to apply principles and practices from the field of dispute resolution to upcoming mandates for change including the new 2009 JCAHO leadership standards related to disruptive behavior and conflict management;
2. Learn the principles guiding conflict resolution practice in health care including the essential components for conflict management training programs;
3. Working with experts in health care mediation, negotiation and collaborative law, create an action plan for advancing the outcomes of the conference dialogues and create an ongoing community of experts.

       Thanks again, Debra! 

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           [Image: Photo of Justices of the U, S, Supreme Court, March, 2006]

          Today, the U.S. Supreme Court will hear oral argument in the most important ADR case of the year, and one that could have a major impact on healthcare dispute resolution for years to come.  Hall Street Associates, L.L.C. v. Mattel, Inc., 196 F. App’x 476 (9th Cir. 2006), cert. granted, 127 S. Ct. 2875 (May 29, 2007), is not a healthcare case, but one arising from a commercial transaction in which the parties entered into a post-dispute agreement to arbitrate. In particular, their arbitration agreement provided that the federal district court could vacate, modify or correct the arbitrator’s award to correct legal or factual error, grounds not expressly stated in the Federal Arbitration Act   
(“FAA”).  The legal issue presented for decision, on which the Circuit Courts of Appeal are divided, is whether the FAA precludes parties from providing for more expansive judicial review of an arbitration award than the narrow scope of review specified in the FAA (under which awards can be vacated only when obtained by fraud or arbitrator misconduct, or if in excess of the arbitrator’s authority). 
          The legal arguments on both sides of this case are well crafted and quite interesting.  Ross Runkel, in his Law Memo, provides a summary, instant access to all of the briefs, and other sources. Sarah Cole, writing in Indisputably, handicaps the outcome and favors the argument for parties’ expansion of judicial review of arbitration awards.  On the law she may be right, but I hope her pick is wrong. 
          There are enough arguments based on legislative intent, case law and statutory construction to support an outcome on either side of this case.  My view is a simpler and more practical one.  If the Supreme Court, in effect, tells all of the lawyers in America that they can assure that their clients’ interests can be “fully protected” in arbitration by drafting an expanded provision for judicial review, that is what America’s lawyers will do.  Indeed, some  might consider it malpractice to do otherwise.
          In an industry like healthcare, which is just starting to understand and realize the benefits of alternatives to traditional litigation, the widespread expectation of “enhanced arbitration” would make it even harder to get conflicts resolved quickly and efficiently.  That is a change I would rather not see.    

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          On Thursday, November 8, 2007, the American Health Lawyers Association will present A "How To"  Teleconference: Arbitrating Healthcare Cases.  The one hour program to begin at  2:00 p.m. Eastern Time, is sponsored by the AHLA's ADR Task Force.  It will focus on the use of ADR in the healthcare industry, and how healthcare lawyers can introduce the use of ADR to their clients.

 [Image: Alexander Graham Bell on the telephone in New York (calling Chicago) in 1892.  Gilbert H.   Grosvenor Collection, Prints and Photographs Division, Library of Congress.]

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[Image: New potato releases by Agriculture Research Service scientists give us even more choices of potatoes to eat.  Photo by Scott Bauer.]  

          If you are a party or legal counsel in a conflict or dispute in the healthcare field, and you believe that some form of alternative dispute resolution process may (or must) be utilized to solve it, you must persuade the other parties involved to share that conclusion and select a qualified ADR provider.  Often these tasks are related.  Opinions differ on how to select a neutral, but my view is that he or she should possess the following attributes:

1.  The neutral should be “neutral”.  Although obvious, the ADR provider you choose should be impartial, fair, open-minded and without conflicts of interest. 

2 . The neutral should be intelligent and creative.  Resolving disputes in the healthcare industry efficiently requires the ability to quickly grasp and understand complex facts and legal issues while simultaneously assessing and attending to the expectations of the parties. It often requires the ability to fashion creative alternatives that work both legally and practically.

3.  The neutral should understand your business.  Although many neutrals believe they can successfully resolve disputes in any industry, it is not reasonable to believe that they can do so efficiently.

4.  The neutral should understand the legal issues.  The web of legal constraints affecting most healthcare disputes is daunting. No amount of general legal experience at the bar or on the bench prepares a neutral to effectively assist the parties or their counsel in such cases.  Jerry Roscoe made this point persuasively in a particular context with his recent article: Resolving Allegations of Health Care Fraud – Does the Mediator Matter? (posted on the ABA Dispute Resolution Section’s Healthcare Committee website).

5.  The neutral should be committed to ADR.  In order to be consistently effective, a neutral must first and foremost believe that alternative dispute resolution principals actually work. Without that belief, the neutral brings no energy or additional value to the engagement, but merely serves as a technician in guiding the parties through a scripted process.

6.  The neutral should be cost effective.  A major justification for the use of alternative dispute resolution is that processes such as mediation and arbitration will be less costly than traditional litigation.  Although this is generally true, it is also true that some ADR services will cost more than others.  Generally, cost will be a function of the neutral’s hourly/daily rate and the parties’ commitment to work with that neutral.

7.  The neutral should be committed to good service.  As a party or counsel in a conflict subject to alternative dispute resolution, you are a prospective consumer of ADR services.  In evaluating a neutral, you should assess the extent to which he or she will provide the level of service that a professional service client paying significant fees should enjoy.  

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          Completing the thought addressed in the two previous posts, there is a third reason why ADR works well in resolving healthcare industry disputes.

[Image: "Smeden og bageren". Illustration by Theodor Kittelsen for Johan Herman Wessel's poem]

Reason #3. 

          Parties to a healthcare dispute can especially benefit from ADR because the unique and complex subject matter of their conflict can be readily accommodated.  By selecting an ADR process and a neutral best suited to the conflict at hand, the parties move immediately into an efficient and productive mode of dispute resolution.  Resorting to traditional courtroom litigation often requires that a judge be educated on the parties’ business model, the world of healthcare finance and reimbursement, and a variety of legal constraints unique to the healthcare field.  Experience indicates that this is a difficult, time consuming and expensive process.  Although most judges are highly intelligent and capable, there is only so much time that can be devoted to each case.  Moreover, most judges sit in courts that handle cases of all varieties, in which healthcare cases are a relatively infrequent occurrence.

          By selecting an ADR neutral with substantive knowledge of the healthcare business and healthcare law, the parties achieve not only efficiency, but a much greater likelihood that they will obtain a result that is fair and mindful of both parties’ real interests.  Although the precise role of the neutral varies within the ADR process selected, the neutral can often help the parties and counsel better identify their interests and how they might mesh with those of the other party.  Where common ground is difficult to find, the neutral can help each party better understand all consequences of the proposals on the table, as well as those of “walking away”.  Sometimes, the neutral’s best value comes from affirming something a party has already heard from counsel, but better accepts with the neutral’s concurrence.  The credibility of the neutral as someone who truly understands the conflict just as well as the parties and their counsel is critical to achieving this result.

          Many examples of this advantage of ADR in healthcare can be imagined, but one may illustrate the point.  A hospital that has “exclusive” contracts with two medical groups to provide two different kinds of medical services at the hospital is faced with a dispute between the groups over which of them has the right to perform a new procedure, a dispute which quickly becomes a three way conflict involving the hospital.  Such “turf battles” are not unusual.  Aside from reviewing whatever the parties’ existing contracts say on the subject, the resolution of this conflict may require consideration of expert input on the impact of the outcome on patient care; the application of the hospital’s medical staff bylaws; provisions of existing managed care agreements;  Medicare reimbursement rules concerning permissible billing by the respective groups; state law and regulations governing hospital licensing and permitted scope of medical practice; and the resolution of other previous (or potential) “turf battles” at the same hospital.  Although the use of ADR in this case may not make all parties wildly happy, the neutral’s appropriate and timely attention to all of these factors will vastly improve the quality and fairness of the outcome.

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          Continuing the thread started in my last post, there are several reasons why ADR works especially well in the healthcare industry. 

[Image: Photo of Coins in the Trevi Fountain in Rome being collected at early morning, by Giovanni Dall'Orto, March 2005]

Reason #2. 

          The parties to a healthcare dispute often (although not always) have interests at stake other than money, or which cannot easily be reduced to a specific dollar demand.  Traditional courtroom litigation is designed primarily to determine which party to a dispute must pay the other party, and how much.  Although courts can grant “equitable relief”, essentially ordering one party to do or stop doing something, that option is limited in scope and driven by the form of the prevailing party’s plea for relief.  In contrast, ADR processes embrace the notion that flexible solutions, tailored to the parties’ unique interests, offer  the best outcome to any dispute.

          An example of this advantage of ADR would be a dispute between a hospital and a medical group over the interpretation of the group’s contract to provide certain medical services at the hospital.  The dispute could involve any number of issues important to both parties, but could easily place the parties in a situation where the contract seemingly must be terminated, and one side will then sue the other for breach of contract.  Neither party in such case really wants to sue the other for money damages, nor do they want the disruption to patient care and hospital services that would accompany protracted litigation.  Courtroom litigation in such case will ultimately assure that the parties’ legal rights are determined and enforced, but it will also create the negative collateral effects that come from using too dull and heavy a tool.  The use of ADR processes in such a case would provide the parties with options and alternatives from which to jointly reach a workable solution.

          Other examples of this advantage of ADR would be disputes over the medical staff privileges to be granted by a hospital to a physician or other practitioner; conflicts between a hospital and its medical staff concerning the interpretation or amendment of the medical staff’s bylaws; disputes within the board of trustees of a health system concerning the system’s mission, or the performance of management; and disputes among providers concerning quality of care or patient access issues.  Although financial considerations may be important in all these disputes, in none of them does either party seek a payment of money.  ADR processes, as determined by the parties, could be focused immediately upon what the parties in such cases really care about. 

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[Image: Musher Thomas Knolmayer at the Willow, Alaska start point of the 2005 Iditarod sled dog race, Photo by Tech. Sgt. Keith Brown]

          With this post, I start my first blog and what I think is the only blog site devoted to the topic of alternative dispute resolution in the healthcare industry.   As stated above on the masthead, I intend to blog at the intersection of ADR and healthcare law.  Both of these topics are well covered separately elsewhere (see links and blogs in sidebar), and I will try not to duplicate those efforts. 

          To make this site most useful, and to bring some order to my thoughts, I am dividing the world of ADR For The Healthcare Industry into topics that make sense to consider separately.  In alphabetical order, this blog will discuss alternative dispute resolution in the context of:

Commercial Healthcare Disputes

Medical Malpractice Claims

These topics will overlap, and undoubtedly will subdivide and recombine over time.  But this is where I will start.  Let me know what you think.

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