Doctors are usually held liable for malpractice in countries with government-sponsored health care systems, but governments often take measures to ease the related financial burden. This report analyzes physicians’ liability laws in Canada, England and Wales, Germany, and India, and reviews relevant national procedures and judicial rulings.
Purpose of Comparison
This report analyzes medical malpractice liability regulations in Canada, England and Wales, Germany, and India. These countries were selected for the study because they provide their citizens with a government-sponsored health care system. While these countries approach the issue of medical liability differently, there are some commonalities in terms of scope and implementation procedures. The report analyzes the countries’ medical malpractice liability insurance programs, grounds for medical malpractice liability, types and amounts of damages awarded by the courts, and certain procedural details..
Health Insurance Programs
Almost all of the residents in the reported countries are covered by government-regulated health insurance programs. Canada has a single-payer health insurance program that is mostly funded by the government. However, provincial health insurance plans may vary with regard to coverage of specific services (e.g., dental care, eye exams, cosmetic surgery), which may be covered by supplemental medical insurance, or provided by employers as a non-mandated health benefit. The health care system in Germany is decentralized and diversified, and consists of more than 200 insurers who, to a certain extent, compete with each other for customers. Germany allows high-income earners to opt out of the statutory system and to be privately insured. Almost 10 percent of the German population exercises this option. In England and Wales, the health care system combines private physicians and hospitals with those who participate in the National Health Service. Similarly, Canada allows private physicians to opt out of the single-payer health insurance program and bill their patients directly. Should they choose this option, they are prohibited from billing the insurance plan for some services while billing patients directly for others. The health care system in India, which is financed through general tax revenues, community financing, out-of-pocket payments, and social and private insurance schemes, combines private and public providers, with public sector health care being divided between federal, state, municipal, and local governments.
Medical Malpractice Insurance Schemes
In the countries under consideration, health care is provided either predominantly by private physicians (Canada) or by private and public entities (Germany, England and Wales). In Germany, private physicians and hospitals enter into agreements to become service providers for statutory health insurance schemes. Health insurers may recover expenses attributable to the injury through the statutory subrogation of the plaintiff’s claim. Canadian private physicians and those who work for hospitals are required to obtain medical liability insurance (usually through a professional organization). Membership fees in the professional organization depend on the field of medicine in which a physician practices and the region where the medical services are provided. These fees include insurance coverage and the right to be represented in medical malpractice lawsuits. At least a portion of membership fee is reimbursed by provincial governments in order to encourage physicians to practice in the provinces. In England and Wales, all financial liability for the negligence of employees is undertaken by the National Health Service Trusts, which are encouraged to participate in the Clinical Negligence Scheme Trust, which deals with medical malpractice negligence claims. Certain clinicians that are not considered to be employed by the National Health Service typically obtain indemnity through a medical defense organization or private insurance. In India, where health care is delivered through partnerships between the public and private sectors, patients are treated as consumers of medical services, and the law provides them with consumer protection rights.
Grounds for Liability
Medical malpractice claims are typically tort claims brought against an individual physician for negligence, or claims brought against a medical institution under the principle of vicarious liability. In England and Wales, if a physician is employed by the National Health Service, the latter is vicariously liable for the physician’s negligent acts and omissions. However, this indemnity covers only the financial consequences of the claim, e.g., legal and administrative costs, plaintiff’s expenses and the amount of damages awarded. If a physician is exempted from the indemnity program coverage, he or she can be sued directly for negligence. In Canada, physicians are usually sued individually for negligence. Hospitals can also be held liable for the conduct of their staff. German medical malpractice law is based on the Civil Code provisions on liability and on causes of action developed by case law. Under Indian law, services provided by a physician to a patient are considered to be not merely of a personal, but also of a contractual nature and fall within the Consumer Protection Act of 1986. The law of torts is applied when a case is not covered by the Consumer Protection Act (for example, when the services are rendered for free). A criminal complaint may be filed against a physician if his or her negligent acts result in death. The burden of proof is on the patient to prove that the physician was grossly negligent.
Types of Damages Awarded
In Canada, plaintiffs are usually awarded compensatory damages. Punitive damages are very rare and are awarded in exceptional circumstances, such as when compensatory damages are insufficient or unavailable, and when the conduct is malicious or highly reprehensible. In Germany, punitive damages are not awarded at all. This type of damages is almost unknown to civil law systems. A plaintiff in Germany usually seeks damages for pain and suffering. In England and Wales, damages awarded to patients in connection with clinical negligence claims are paid by the National Health Service Litigation Authority following the settling of most of the claims out of court. In India, claims are adjudicated by consumer dispute agencies in the same manner as all other consumer complaints, and the amount of redress is limited according to the agency’s territorial jurisdiction.
Amount of Damages Awarded
Awards against physicians are generally rare and the amount of damages awarded to victims of medical malpractice is relatively low (although in Germany the prevailing trend is toward a slowly increasing number and size of awards for pain and suffering). There are several reasons for this:
- No jury or punitive damages (Germany, India);
- Legally established guidelines for the calculation of damages limit recovery to certain sums (Canada, Germany, India);
- A considerable amount of the losses resulting from personal injury are borne by the social security system;
- The availability of free medical treatment and medications:
- Unlimited paid sick leave, generous pension plans, and welfare benefits (Germany);
- The practical difficulty of establishing professional negligence in court (Canada); and
- Partial recovery of the plaintiff’s litigation expenses where the case is not fully satisfied, which discourages plaintiffs from claiming higher amounts of damages in cases where the courts are not allowed to award damages beyond the amount of recovery sought (Germany).
Most medical malpractice liability cases are settled out of court. Only 8 percent of these cases are litigated in Germany, and only about 4 percent in England and Wales. In contrast to Germany and England and Wales, where settlement of medical malpractice claims by means of alternative dispute resolution is encouraged, the Canadian Medical Protective Association vigorously defends medical malpractice suits, and has been criticized on a number of occasions for rejecting reasonable settlement offers in order to discourage other lawsuits. A peculiar mechanism of medical malpractice dispute resolution was created by the Indian Consumer Protection Act. The Act provides for a system of special institutions at the national, state, and district levels (consumer councils) that have jurisdiction over medical malpractice claims under certain specific amounts.
Malpractice lawsuits do not affect the delivery of health care in the countries included in this report, and are not a subject of controversy. Because of an extensive safety net of social laws in the countries reviewed and the active participation of governments and other stakeholders in redressing instances of clinical negligence, liability for medical malpractice generally leads to moderate damage awards. Most of the medical malpractice claims in these countries are settled and, as a rule, cases are only tried when a serious injury has been inflicted. In such cases, awards for pain and suffering tend to be greater.
Prepared by Peter Roudik
Chief, Eastern Law Division
Last Updated: 01/23/2015