Full Context · INTERVIEWS


Madeleine Pelner COSMAN

Vol. 10, No. 4  (December 1997 )

The following excerpts are from Karen Reedstrom's interview with Madeleine Pelner Cosman, published in the December 1997 issue of Full Context.

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Q: Where did you grow up and what kinds of ideas and surroundings influenced your early development?

Cosman: I grew up as a Jewish child during the Second World War, primarily in New York. The fact of war was very significant in several things—first my learning multiple languages; then second, my learning to use certain instruments which were unusual for girls, such as learning to fly an aircraft. I was "hooked" on flying in kindergarten.

Q: So, what made you want to become a lawyer?

Cosman: I always was fascinated by the ideas of the law or law as affecting people’s behavior. So I first took a Ph.D. at Columbia, and then I went on to take a J.D. at Cardozo Law School.

Q: You are the president of Medical Equity, Inc. Can you tell us about that company, how you came to be associated with it and what are its goals?

Cosman: I built Medical Equity in 1980. At that time I was a university administrator and medical school professor. A very dear friend became fatally ill. I naïvely thought that I would be able to find an expert to help in his need. I discovered that there were a lot of people willing to take large amounts of money to give advice, but for the most part each was in dire conflict with the other. I therefore elected, since medical law was my expertise, to learn the particular law on the transfer of medical practices. I was able to help my friend, and within a few weeks I was called to help yet someone else. Without intending initially to build a national corporation (which it ultimately became) I went from case to case and built up a very considerable experience and expertise in the transfer of practices from practitioner to practitioner.

Q: What exactly is that?

Cosman: I literally make a valuation of the total medical business: the good will of the practice, the value of the instruments and the equipment, the transferable assets from one expert to another. What my group does is to help practitioners who are generally in some form of crisis, either elderly or ill or having endured an acrimonious divorce or some significant change of fortune that requires their leaving the current practice. For either a malevolent or benevolent reason they have to leave, and I help make that a logical, orderly, generally lucrative transition.

Q: How were you introduced to the ideas of Ayn Rand?

Cosman: Actually, I was a junior in college when I discovered The Fountainhead purely by accident, and was totally enthralled. I felt, for the first time in my life, that here was a thinker who I not only admired but wanted to emulate. Here was one who cherished the verifiable, who insisted upon logic and order. This was immediately appealing, and basically a confirmation of what I thought I already knew.

Q: Your book Fabulous Feasts: Medieval Cookery and Ceremony was nominated for a Pulitzer Prize. What is it about and why do you think it was so well received?

Cosman: I’ve written 14 books and that one was nominated for the Pulitzer Prize as well as the National Book Award. That sounds somewhat startling for someone who is an expert in medical law. It is a very lavishly illustrated book, which has approximately 800 or more medical/legal documents as its origin. My original intent, and this is one of the things the Pulitzer Prize committee liked, was to determine whether it was possible to take a very demanding and unforgiving—as well as unpopular—subject, medical law, and make it appealing to an intelligent popular audience. To my great delight, the book got a huge amount of favorable response, and it’s still selling beautifully in several languages, including Japanese. In fact, when I was doing work at the Supreme Court this past summer, I went with one of my medical students to the Library of Congress’s book store, and they were featuring Fabulous Feasts! So, completely without preparation I ended up doing some book signings in the Library of Congress.

Q: Does the book have a lot of recipes in it?

Cosman: It is a serious, yet exuberant study of food and feasting in all aspects of medieval culture. But it does have 101 recipes from medieval medical and legal manuscripts. Quite a few of the recipes are derived from medical malpractice cases, in which particular foods and drinks were said to be effective for either the prevention, the treatment, or the cure of particular diseases. When the cure was not effected the patient sued the practitioner. The menu or recipe was incorporated into the lawsuit. It was from this rather unpromising beginning that I built this treasure trove of exquisite culinary adventures.

Q: That sounds so interesting! Now, what about your book Selling the Medical Practice: the Physicians and Surgeons’ Guide. What was it about?

Cosman: That has been very popular and it’s been reviewed as the industry bible for the brokerage of practices. It presents the logical, orderly method for transferring the practice. It details who can sell, who can buy; what is saleable and what is not saleable; how one negotiates the sale; how one writes the contract. It gives case histories, and it’s respectfully and affectionately written so that either the physician or the lawyer can get the material in a benevolent, gracious way. "ClintonCare" and Health Care Policy

Q: You were one of the activists working to derail the Health Security Act of 1993. How do you view your own role in the defeat of "ClintonCare?"

Cosman: With gratitude. I worked exceedingly hard, and I’m extremely grateful that the message was effective. I did several things, besides lecturing nationwide, after I had read all 1,364 pages of that pernicious legislation. I wrote The ABC’s of the Clinton Medical World which the Cardozo Law Forum published. We did it in a special tabloid version illustrated whimsically with Renaissance woodcuts. It was an elegant and charming document, but its intent was to force people to actually read the legislation. I felt confident that once they read it that they inevitably would reject it. I originally wrote it for the U.S. Congress because I was testifying in Washington, and discovered, to my horror, that no one had actually read the legislation. They had read short versions, précis, and synopses, but no one had actually read this turgid and quite vicious legislation with its desperate penal sanctions—really horrible criminal sanctions—against physicians for actions which under other circumstances would probably be considered ethical and proper.

Q: Well, my readers and I would like to thank you for your efforts! What was the effect of The ABC’s of the Clinton Medical World?

Cosman: It was extremely effective. Though originally created for Congress, it was then disseminated throughout the country. The effect was quite dramatic. Some in favor of the Clinton Health Plan were so upset that they actually made threats against the Cardozo Law School for having published it. People were alerted to what was truly in the plan as to, say, "capitation," or "community rating," or "medically necessary" and other terms which do not mean, in the legislation, what they mean in plain English. Their definitions in the legislation were truly pernicious.

Q: What were the threats made to the law school?

Cosman: Precisely which, I can’t tell you, but they were sufficiently severe to have made the newspapers. The Dean of the law school put his arm around my shoulder, as we were going up in the elevator, and said "Ah, Madeleine, congratulations upon having enemies in such high places!"

Q: John C. Goodman from the National Center for Policy Analysis is sometimes cited as the major player behind the toppling of the Clinton plan. In your opinion, what did he really do?

Cosman: I don’t know him personally and I can’t attest to what he did or did not do. I can, however, enthusiastically recommend his book Patient Power (with Gerald Musgrave) which is a superb presentation of the economic and philosophical uses of medical savings accounts. And for that, he deserves all of our kudos and gratitude.

Q: Do you think Clinton is trying smuggle in his agenda piece-by-piece, first, with the Kennedy-Kassebaum bill, and now his "Health Care Bill of Rights?"

Cosman: Absolutely! In fact, in several interviews, he vowed to enact in small pieces what he had hoped to enact whole in his plan. My guess is that, with the advent of "kiddy care," he is attempting to control healthcare for children. Medicare controls care for the aged. Only those in the middle will not be covered by national healthcare, but will bear the full financial burden of both the children and the elderly.

Q: Are there any positive aspects to these reforms, like the medical saving accounts provision of Kennedy-Kassebaum?

Cosman: Medical savings accounts can be our salvation in retaining the best of American medicine and the best of fee-for-service medicine. However, in Kennedy-Kassebaum, the MSA’s are dreadfully restricted and circumscribed (I’m sure by intentional prohibitions) so that they will fail. For example, in Kassebaum’s home state of Kansas, she cannot buy an MSA if she were interested in so doing, because the MSAs are required by law to provide a sufficiently large package of benefits that makes them economically unfeasible. So no one will sell them. Medical Savings Accounts are a superb device. I heartily encourage them.

Q: What do the think of the rise of the HMOs? (health maintenance organizations)

Cosman: They’re horrible. For the most part, they’re run under capitation. That term comes from the Latin word caput, meaning "head", and it means paying per head. If a practitioner or the organization employing the practitioner—the HMO is paid per head. The patient pays a premium to the insurance company. The insurance company negotiates with the HMO for a per-head fee for each insured. The HMO will be paid the same amount, neither more nor more frequently, no matter how many times the "head" comes in for care or what care is required, whether for a cold or a scratch or for a cardiac arrest! The incentives, therefore, for the practitioners and the organization employing them, the HMO, are perverse. It requires a withholding of care in order to be fiscally viable. Depending on the type of HMO, the individual doctor will be more or less strongly encouraged to withhold care which is expensive, such as for diagnostic services and surgery.


Q: As a lawyer, what do you think is the most common concern for doctors today with regard to litigation?

Cosman: The subtle, surreptitious change in the law from civil law to criminal law is probably the most dangerous change in the law. Practitioners who accept any form of government reimbursement, as well as any insurance which imitates government reimbursement, are subject to criminal laws. Even without any intent to defraud, they may find themselves strictly liable for felonies, and be clapped into jail. I have several clients, excellent, ethical, remarkable people, who are, in fact, in Federal penitentiaries. In one instance, a client did cataract surgery for patients who were thrilled to get their eyesight back; but government investigators, because of a technical violation, concluded that the surgery was "medically unnecessary." One physician, convicted of having performed fifteen such medically unnecessary cataract operations and thus having "defrauded" the government of $65,000, was given the penalty of 11 years in prison and forced to pay back $16,000,000 to the government. Contemplate that!

Madeleine CosmanMadeleine Pelner Cosman, Ph.D., Esq. is an attorney best known for her work in medical law and professional practice valuation. She is President of Medical Equity, Inc., a national medical and law practice brokerage, located in Tenafly, New Jersey. Holding a J.D. from Benjamin N. Cardozo School of Law in New York City where she was a Jacob Burnes Fellow, Madeleine is a member of the New York State Bar, New Jersey Bar, and the American Bar Association’s Section on Law Practice Management. She is a Barnard College graduate (1959), with a Master’s Degree from Hunter College (1960), and a Ph.D from Columbia University (1964). Dr. Cosman is Professor Emerita of the City College of City University of New York where for 30 years she taught medical students medical law, medical business, and medical history, and as an academic administrator directed from 1968 to 1993 a 15 Department degree-granting Institute. She is a Life Fellow of the New York Academy of Medicine.

Writing articles and books on medical law and related subjects since the 1960’s, one of Madeleine’s 14 published books, Fabulous Feasts, was nominated for the Pulitzer Prize and the National Book Award and was a Book of the Month Club Dividend Selection. Her Selling the Medical Practice: the Physicians’ and Surgeons’ Guide (Bard Hall Press, 1988) is welcomed by physicians, attorneys, and bankers as are her essays in National Trial Lawyer on medical goodwill, medical covenants not to compete, and medical finance. From 1989 she was Associate Legal Editor of National Trial Lawyer. She also writes for Fair$hare: The Matrimonial Law Monthly.

This excerpt represents about 1/4 of the interview with Dr. Cosman. To read the transcript of the interview in its entirety, you may request a copy of the December 1997 issue of Full Context here.

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