Transforming Healthcare : Reaching New Heights : KPJ Healthcare Conference 2013

ADR The Way Forward

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Number of Medical Negligence cases registered in the Government Contract and Medical Negligence Unit of the Civil Division.
YEAR Case No.

2002 34

2003 36

2004 36

2005 33

2006 39

2007 46

2008 53

2009 45

2010 37

2011 56

See: Attorneys-General Chambers Annual Report 2010/2011

From 2006-2011, 266 medical negligence cases have been registered with the unit.

There is clearly marked increase negligence cases from the late 1990s.

in

medical

In 1998, only 16 medical negligence cases were recorded.

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*
* According
to the Malaysian Ministry of Health Annual Report 2010, the amount of compensation paid for court cases has risen from RM1.2 million in 2006 to RM5.6 million in 2010.

* Payment * In

for potential medico-legal cases and settled out of court has also risen from RM25,000 in 2006 to RM906,365.21 in 2010. the period of 5 years from 2005-2009, 113 negligence cases involving government healthcare providers, mainly doctors, have been settled in and out of court, of which Obstetrics and Gynaecology accounted for 42 of them (37%).
negligence cases.

* 5 to 6 figure court awards are becoming the trend for medical

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From the World Academy of Science, Engineering and Technology 2013 by Puteri Nemie Jahn Kassim and Khadijah Mohd Najid

*
* In
an interview, Datuk Dr NKS Tharmaseelan, President of the Medico Legal Society of Malaysia shared an opinion that doctors have gone bankrupt from paying up large awards, while some even if found innocent of negligence have given up their practice due to the stress, suffered reputation and social standing, and pressures of being in the spotlight during the course of the court case.

* Increasing subscriptions rates for medical malpractice insurance premium. On

the top of the list is O&G where insurance premiums for specialists increased sharply from RM15,300 in 2004 toRM43,610 in 2009, rising averagely RM5000 to RM6000 annually. To date, Malaysian Obstetricians have to pay RM62,000 to protect themselves from the threat of litigation. is also observed that the liability of the costs are passed along and returned to be borne by patients as part of the price of medical service.

* It

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From the World Academy of Science, Engineering and Technology 2013 by Puteri Nemie Jahn Kassim and Khadijah Mohd Najid

Dr Soo Fook Mun v Foo Fio Na and Anor [2001] 2 MLJ 193: ... if the law played too interventionist a role in the field of medical negligence, it will lead to the practice of defensive medicine and the cost of medical care for the man on the street would become prohibitive without being necessarily beneficial.

Alternative Dispute Resolution refers to the different methods of resolving disputes between parties outside the judicial structure or process, which is an alternative to the widely known or accepted formal litigation or court hearings.

ADR is a form of facilitated settlement, which is confidential and without prejudice. Consequently the contents of the process need not usually be disclosed to a court.

ADR process includes mediation, facilitation, arbitration, case evaluation, neutral fact-finding, and consensus building processes.
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Mediation (Interest based)

It is a process whereby disputing parties engage the assistance of a neutral third party to act as a mediator (an intermediary). A Mediator has no authority to make binding decisions, but uses various procedures, techniques and skills to help parties resolve their dispute by reaching a negotiated agreement.

Arbitration (Rights Based)

A procedure whereby both sides to a dispute agree to let a third party, the arbitrator, decide. The arbitrator, will make decisions based on the facts presented and the decision will be legally binding.

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* The Mediation Process

Agreement to Mediate Appointment of a Mediator A presentation of opening statements and the exchange of facts between disputing sides

A decision made to resolve or terminate the proceedings

A discussion of possible resolutions

An identification of the main facts to be discussed (These are generally prioritized in cases with a lot of issues.)

Closing process whereby agreements are written up and the mediation process is ended.

* The Arbitration Process

Arbitration Agreement

Appointme nt of Arbitrator

Preliminary Meeting

Order of directions: Pleadings, Discovery, Exchange of Witness Statements , Hearing, Closing Submission s

Issuance of award

*
Confidentiality Active involvement of parties in resolving the dispute Time & Costs saving Matter is heard by experts in the related field

Flexibility of the procedure

Privacy and Professional Reputation assured

Parties perceive it to be fair

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*
* Very
true in relation to ADR. There are different considerations which determines which ADR mechanism is fitting.

* Cost and complexity of the dispute are the main considerations and
next is the relationship of disputing parties.

* Where matter/ issue is simpler and where parties are looking for
effective communication, continuity in relationship and maintaining good will, it is best to resolve through mediation.

* Where the issue is more complex and higher costs considerations

leading to termination of contractual relationship then arbitration will be more fitting.

* What is the right fit for medical negligence cases?

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*
* What are the patients looking for?
* EFFECTIVE COMMUNICATION
* Patients want some control in the decision making process they want to
make an informed choice based on recommendations from experts.

* Most

of the times simple apology, the costs of hospitalization and treatment, or merely an explanation of what and how it had happened. and physicians alike would prefer matters to be kept off the public records and certainly not in the newspapers.

* CONFIDENTIALITY AND PRIVACY

* Patients

* SETTLEMENT OF DISPUTES WITHOUT PREJUDICE TO RIGHTS

* Patients would also like to settle disputes without putting an end to their
rights in seeking redress in the courts.

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*
* Arbitration * Physicians * Mediation
discourages communication other than those between the parties respective lawyers. and patients communicate in the form of answers to questions, either in interrogatories, depositions or at a hearing. Instead of communicating, they testify. takes place in the shadow of law. Both parties seek to understand and persuade the other of their best estimate of what the likely result of the trial. is able to address any interest that he may have regard to the claim.

* In discussion with his counsel and the mediator, the physician

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*
* Arbitration is also workable with the following considerations:
* When the focus is not about maintaining relationship. * Finality in the decision. * Having an expert to decide and still maintain confidentiality.

* The main concern:* Whether patient are able to bear the costs of arbitration (being a
more costly form of ADR)

* There

needs to be an agreement to arbitrate. Incorporation of the agreement with the Patient.

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*
* Experience of the Malaysian Dental Association:
*
A study carried out in 2009 on 41 cases in the duration of 3 years where 69% of the cases were successfully mediated, 10% unresolved and 21% are in various stages of mediation.

* The Malaysian Dental Association has shown mediation with a success rate of
95% and their dental indemnity insurance premiums have remained at RM 1150/- per annum.

* In Singapore, ADR for medical negligence cases is growing.

* The Straits Times in Singapore reported that in 2006, about 7,310 cases were
resolved through Court Directed Resolution (CDR).

* In

2005, only 11 medical negligence lawsuits were reported in the Subordinate Courts. All were settled out of court.
the right education and proper direction from the relevant parties, there is a real prospect for medical negligence cases to be removed from the litigation landscape.
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* With

*
The mediator or arbitrator would be an EXPERT in the industry. CONFIDENTIALITY of the proceedings, protects loss of reputation which is essential in this industry. PRIVACY of the dispute resolution process and greater flexibility.

Less adversarial, may be more suitable where parties are seeking closure.
Disputes would be resolved faster and inadvertently the cost would be reduced. Costs of Mediation are much lower.
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Ad hoc

Mediation/Arbitration

Under Institutional Rules

KLRCA came into existence in 1978 by virtue of the Host Country Agreement between the Government of Malaysia and the Asian-African Legal Consultative Committee, formally know as AALCO.

KLRCA has been entrusted with broad functions as a coordinating agency in the AALCOs integrated disputes settlement system.

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To promote international commercial arbitration in Asian and African regions

To coordinate and assist the activities of existing arbitral institutions, particularly among those within the two regions

To render assistance in the conduct of Ad Hoc arbitrations, particularly those held under the UNCITRAL Arbitration Rules

To assist in the enforcement of arbitral awards

To provide for arbitration under the auspices of the two centres where appropriate

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*KLRCAs additional roles

To provide for arbitration under the auspices of KLRCA To carry out the functions envisaged in the agreement with the International Centre for the Settlement of Investment Disputes (ICSID)

To provide alternative options for the settlement of disputes such as mediation under the Mediation Rules of the KLRCA
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To appoint arbitrators for disputing parties, as and when requested, under the Rules for Arbitration of KLRCA and the Malaysian Arbitration Act, 2005

Arbitration Act 2005 (Amendment) Act 2011

Mediation Act (Operated on 1 Aug 2012)

*
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*
The Act does not define a Mediator or the qualifications required. This allows room for institutions to maintain/set their own qualifications. The Government is subject to the Act.

Mediation proceedings are to remain confidential.

Mediation agreement may be enforced upon registration as a consent judgment.

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 KLRCA recently
2013.

revised the Mediation Rules effective on 24th October

* The

new set of rules provide for a simpler and practical mediation process aimed at providing a fast and cost efficient alternative dispute resolution.

* It improvises and simplifies the appointment process of the Mediator. * Further, it sets out the conduct and ethics of the Mediator as well as
the participation of Parties to the Mediation process.

* The confidentiality of the Mediation process is further enhanced in the

new Rules and the fee tariffs are simplified.
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*
Rules 7 to 11

Upon commencement of the Mediation process, the rules clarify on the appointment of the Mediator. Director of the KLRCA to appoint the Mediator where the parties fail to agree within 30 days of the Request for Mediation. The appointment of the Mediator under of the KLRCA Mediation Rules removes the requirement of request from parties.

Rules 10 and 11

incorporates requirements on independence, impartiality and code of conduct. provide for the disqualification of the Mediator if any party to the Mediation objects to the continued service of the Mediator.

Rules 12 to 16

Mediators role prior to the commencement of the Mediation is laid out in terms of communication with Parties as well as participation in preconferences. The Rules lay down the fundamental requirement of good faith of all Parties participating in the Mediation process.
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*
Rules 17
requires Parties representatives involved in the mediation process to have
the necessary mandate and authorization to settle the dispute.

* This is

to ensure that parties participate in the Mediation with the intention of resolving the dispute in the most timeous manner.

Rules 27(d)
Mediation
time.

shall be deemed terminated if it is not resolved upon expiry of 3 months from request of Mediation. * Parties with interest in continuing with the Mediation may agree to extend the

Rules 19-21
A
Confidentiality Agreement and Undertaking incorporated under Schedule A of the rules.
arising out of the Mediation private and confidential.
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has

been

All parties to the Mediation are bound to keep all matters relating to or
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* KLRCAs Mediation Rules 2013

(Schedule of Fees)
Item Registration Fee (non-refundable) International (USD) 50.00 Domestic (RM) 150.00

Administrative Costs

250.00

500.00

Mediators Fees

6000.00 per day 750 per hour

3500.00 per day 450 per hour

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Parties may agree to mediate under the KLRCA Rules by incorporating a model clause such as below:

Where, in the event of a dispute arising out of or relating to this contract, the parties wish to seek an amicable settlement of that dispute by mediation, the mediation shall take place in accordance with the Kuala Lumpur Regional Centre for Arbitration Rules for Mediation as at present force.
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Up to date, simple and practical Rules of procedure Administrative Assistance Panel of Mediators Facilities and Support Services Cost Effective

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*
KLRCA has its own framework, procedures and rules designed to assist parties (based on UNCITRAL Rules for Arbitration) Administrative assistance Panel of Arbitrators (listing according to nationality) Facilities and support services Cost effective:

KLRCA Model Arbitration Clause

Any dispute, controversy or claim arising out of or relating to this contract, or the breach, termination or invalidity thereof shall be settled by arbitration in accordance with the KLRCA Arbitration Rules

*
* Healthcare * Medical
provider should stay up todate with latest ADR processes that are available. practitioner who understands and appreciates the ADR mechanism will be able to carry out self-assessment. E.g. Carry out the test (Bolam / Whitaker) as a checklist when making the necessary decision or conduct of treating patients. ADR clauses in agreement with patients seeking healthcare (Mediation for example) dispute resolution strategy. E.g. mediate first, then

* Include

* Escalated

arbitrate.
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KUALA LUMPUR REGIONAL CENTRE FOR ARBITRATION (KLRCA)

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12, Jalan Conlay 50450 Kuala Lumpur Malaysia T: +603 2142 0103 F: +603 2142 4513 E: enquiry@klrca.org.my W: www.klrca.org.my
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