Amplified in OB
All of the concerns above apply to every aspect of healthcare. But nowhere are they as amplified as in obstetrics (OB), especially during labor and delivery (L&D). In most hospitals and health systems, OB is either the leading generator of medical malpractice liability issues and resulting premiums, or at least in the top three.

That is certainly the case at my organization, MedStar Health, which is headquartered in Maryland and has hospitals and clinics in Maryland, Virginia and Washington, DC. It makes sense when you think about it.

First, rather than dealing with a single patient, you have the mother-baby dyad, which given their reliance on each other, more than doubles the potential risk. A change in the status of one may have a downstream effect on the other, which can be easily missed in the often chaotic and data-intensive L&D environment.

Then there is the way the liability system is structured. As a strategy to inflate the costs of settlement and jury awards, the plaintiff bar routinely uses exaggerated “life care plans.” Life care plans purport to estimate the future cost of care for patients. These plans often run into tens of millions of dollars. Thanks to the many medical miracles we’ve developed, that care may now take place over many years, ratcheting up settlements and awards. As a result, cases that used to resolve for $2 million to $5 million now carry a penalty of $15 million to $20 million. Just one such case per year can impact the bottom line of any health system.

One other factor comes into play in many of these cases: Sympathy. Childbirth is supposed to be a happy time in a family’s life. But when it goes wrong, and an infant suffers a catastrophic injury that means he/she may not be able to eat, get dressed, or perform other routine daily tasks alone (not to mention get a job, get married or have children), it’s not difficult to understand why those sitting in judgment often side with the plaintiff.

With so much at stake, why offer OB services at all? In some cases, hospitals and health systems have no choice. Babies need to be born somewhere. Local or state government may dictate that a hospital maintain OB services to serve the needs of the community.

But OB is also a good loss leader. Mothers are typically the decision-makers for healthcare in their homes. A positive experience in L&D makes the mother more likely to continue using the hospital and its affiliated physicians, creating tremendous lifetime value across the entire family. The key, however, is doing all you can to ensure that first experience has a positive outcome.

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