What we know (and don’t know) about tort reform

By Mike King

For more than two decades a basic tenet of the Republican Party’s response to the need for health care reform has been to raise the issue of defensive medicine – and the fear doctors have of being sued – as a driving factor in the escalating cost of medical care. The party’s goal has been to enact federal legislation that would impose restrictions on plaintiffs filing malpractice suits and substantially limit the amount of money they could get from juries for non-medical damages if they successfully pressed their cases.


The GOP’s efforts have never gotten far in Congress with conventional wisdom holding that the federal legislative branch is dominated by trial attorneys who have no interest in reducing large awards for damages won for plaintiffs by their barrister colleagues. The best Republicans can probably hope for in the current health care reform bills being debated in Washington is funding for a handful of demonstration projects in the states to test whether some new ideas for how to handle malpractice claims are worth considering on a national level.



That’s because state legislatures have given the issue much more traction with more than half of them having passed some kind of medical malpractice reform in recent years. Georgia was a little late to the tort reform game, having to wait until
the GOP came to control the Governor’s office and both houses of the Georgia legislature to enact major changes in medical malpractice litigation.


Those measures, which have been in effect about five years now, cap non-medical malpractice damages at $350,000 per provider; eliminated joint and several liability; implemented some qualifications for expert witnesses; granted immunity to emergency room physicians and ER providers in the absence of “gross negligence”, and allow doctors, nurses and other providers to apologize to injured patients without fear that the apology can be used as an admission of guilt against them in court. (A case involving the ER immunity provision is now before the state Supreme Court – the first major challenge to the reform effort.)


Are the reforms working? Unfortunately, there’s no clear answer to that in Georgia or elsewhere.

Malpractice insurers – often subsidiaries of professional provider associations – have in recent years reduced the premiums they charge physicians for coverage; or at least scaled back annual premium increases that were common before reform. But there is no evidence to show that has led to a corresponding reduction in physician charges to patients. Additionally, there is anecdotal evidence that plaintiff’s attorneys are now more particular in the cases they are taking, leading to fewer nuisance cases. Georgia judges also seem to be mandating more attempts at mediation prior to proceeding to trial.

Plaintiff attorneys say the new laws make pressing legitimate cases much more costly and time consuming and allow deep-pocketed defendant hospitals and physicians to simply wait their victims out. They point out studies that show only 2 to 3 percent of negligence cases lead to malpractice claims in the first place and the reforms have significantly reduced the rights of injured patients to be compensated for gross errors in medical judgment that should not go unpunished.

Have the new laws lessened the practice of “defensive medicine”?


Intuitively, it makes sense that doctors would feel less need to order more tests and procedures if they felt secure that a decision not to do so won’t lead to a claim that jeopardizes their practice if something goes wrong. But we really don’t know if that is true.

The cost of defensive medicine is almost impossible to calculate, since there are so many other incentives — financial and medical — that contribute to unnecessary tests and procedures.  The Congressional Budget Office, the AMA, academic experts in conservative and liberal think tanks and others put the annual cost of defensive medicine somewhere between $8 billion and $60 billion – nowhere near the $100 to $200 billion being touted by GOP promoters of malpractice reform in Washington. The lowest estimates put the figure at one-half of one percent of total health care spending in the U.S. It would be years, if ever, before we might see any semblance of cost savings in overall health care spending due to tort reform. So the larger question is whether any more draconian measures limiting the right to sue for medical damages are really worth it?


A potential compromise

The states should be left to continue trying their own reform approaches, with some new ones being funded by the federal government. These demonstration projects should include a detailed cost-benefit analysis of how they have worked after some appropriate period of time. The health reform bills now being negotiated in Washington should instead be aimed at treating malpractice reform not as an isolated issue, but an opportunity to get serious about efforts to reduce medical errors and imposing tougher disciplinary measures for providers who make repeated mistakes. These are the bad players who tend to drive up the huge damage awards.


Of course that would involve the government paying for more research into treatments that really do work and tests that really help diagnose – outcomes-based measurements that some doctors balk at when it comes to being reimbursed for their decisions. (When private insurers do this it is considered cost control. When Medicare or government programs want to do it, it’s labeled rationing.) Still, by conforming to widely-accepted, scientifically-tested treatment recommendations, the relationship between physicians and patients might become less adversarial and reduce the risk of lawsuits when something tragic happens.

Comments

  1. Wales Whitt says:

    I doubt that there is evidence that physicians order unnecessary expensive diagnostic testing to insulate themselves against lawsuits. If the first test isolates the illness, they have no reason to order more. If the test returns negative, it at least indicates what is not wrong,but medical diagnostics is frequently a process of eliminatiion. Personally, I want access to all modern diagnostic tests, if my illness so indicates. Not so long ago, a prime diagnostic tool was smelling a patients breath. Who wants to return to that. What we’re haggling about is money, and the distribution thereof. Who pays, who gets paid and how to determine a fail return on investment.

  2. [...]  Mike King  at Healthy Debate writes about how malpractice insurers recent years reduced the premiums they charge physicians. Some “at least scaled back annual premium increases that were common before reform. But there is no evidence to show that has led to a corresponding reduction in physician charges to patients.” [...]

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