Breaking Barriers to Justice
A Plaintiff’s Strategy for Justice in Kaiser Arbitrations By Bruce Fagel, MD, JD
The Kaiser/Office of the Independent Administrator (OIA) arbitration system is an obvious barrier to justice for victims of negligence within the Kaiser healthcare system. It has been the subject of much discussion recently among the plaintiff’s medical malpractice bar about how to improve or do away with the system. Unfortunately, neither option will occur. We need a better approach to deal with this system to receive an equitable and reasonable resolution to Kaiser medical malpractice cases. Rather than assuming the case is subject to arbitration (and sending the $150 fee to the OIA), one starting pointis filing all Kaiser cases in court,forcing Kaiser to prove they are entitled to arbitration. But once the case is in arbitration, we must fight for a fair outcome - as compared to a jury trial. We all face the problem that Kaiser neutrals are not neutral. They are subject to indirect pressure and risk both offending Kaiser by making any significant award to the plaintiff and being black balled by Kaiser for the foreseeable future. An obvious financial disincentive exists. While we know that Kaiser has settled cases for significant sums (sometimes exceeding $15 million), that arbitrator will likely lose Kaiser’s business with future arbitration cases.
Annually, the OIA makes public the list of arbitration awards with the amount of the award. But settlements, including the amount and name of the neutral arbitrator, remain confidential. Kaiser should therefore draw a clear distinction between a settlement, for any amount, and an arbitration award. First, decide if the case is “high” or “low” value. Arbitrarily, we may classify any case as low value if the potential recovery is less than $1 million (although, with the change in the caps for wrongful death and non-economic damages, this amount should probably increase to $2 million). In such cases, a single neutral arbitrator is probably appropriate since any arbitrator may not feel too threatened regarding future business if they award such a sum in a liability case. Since Kaiser must pay the full amount for the neutral arbitrator, usually in the range of $50,000 to $75,000, they may consider that it may be more cost- effective for them to settle the case versus pay for the cost of the arbitrator in addition to any award. Let us consider a high-value case (anything more than $5 million). This would include care with future medical costs and/or significant loss of earnings. Although the OIA rules allow for a single arbitrator, it is well worth the extra expense to have party arbitrators, which includes paying for half the cost of the neutral. Such a three-party panel is only necessary for an arbitration, not for any pre-arbitration status conferences or discovery. Plaintiff can start the case with a single neutral arbitrator, chosen by stipulation or by the OIA. If the case does not settle before the arbitration date, plaintiff can then request party arbitrators and pay half the cost of the neutral.
Bruce Fagel, MD, JD, r epresents plaintiffs in medical malpractice cases against doctors and hospitals on behalf of injured patients. The Law Offices of Dr. Bruce G. Fagel & Associates has multiple locations throughout California. brucefagel@fagellaw.com
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Consumer Attorneys of California
FORUM July/August 2026
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