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CONFLICTS WITH OTHER CLIENTS

Attorneys who represent clients with adverse interests eventually will be forced to compromise the interests of at least one of the clients. This is a particular problem in legal specialty areas such as medical law. There are advantages to the client in hiring a law firm that has experience in the problems at hand. In medical law, this means a law firm with experience in representing health care providers. Now, with the competition between hospitals and between individual physicians, it is important to ask the identity of the law firm's other health care clients. (This is not privileged information.) If the law firm represents real or potential competitors, it is best to hire a different law firm. Sometimes it is impossible to find another law firm with the appropriate expertise. It is then up to the law firm and the client to discuss the potential conflicts and establish a plan for avoiding them. This is especially important in medical malpractice defense.

In most medical malpractice cases, the physician is insured. A condition of this insurance is that the insurance company pays for the defense of a case. This benefits the insurance company because it is mostly its money that is at risk. It benefits the physician because attorneys are expensive, and a principal reason for buying insurance is that it pays defense costs. The problem is that the defense attorney represents the insurance company, not the physician. This becomes obvious when the potential recovery is substantially larger than the coverage provided by the insurance policy. If the insurance company misjudges the case, the physician also pays. In these situations, physicians should retain their own attorneys to ensure that the insurance company protects their interests as well as its own.

The most important conflict is more subtle. It involves how the aggregate cost of defending many medical malpractice lawsuits drives up the cost of insurance. In any lawsuit, the physician defendant will want the insurance company to spare no expense on his or her defense. Unfortunately, every physician suffers when it is time to pay the insurance premiums attributable to the increased cost of defense. (See Chapter 7.)


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