NCPA - National Center for Policy Analysis


September 3, 2009

For purely political reasons, Obama has rejected one of the most effective tools for containing medical costs -- tort reform -- because it would upset a special interest group -- well-heeled plaintiff's lawyers -- that is one of the biggest funders of the Democratic party, says editor Fred Barnes.

Yet tort reform remains a key to paring costs:

  • It would put sensible limits on medical malpractice lawsuits that have flooded the courts and forced doctors to practice "defensive" medicine.
  • Studies of the effects of such medicine put its price tag at a minimum of $100 billion a year and probably more than $200 billion.

In a study last year by the Massachusetts Medical Society, 83 percent of doctors reported they practiced defensive medicine.  This is hardly a surprise.  Simply to avoid being sued, doctors order more tests, procedures, consultations, referrals to specialists, and hospitalizations than they otherwise would, says Barnes.

There are other downsides.  Because doctors pay more for malpractice insurance, patients pay more too:

  • Nearly $2,000 a year in extra health expenses for an average family, according to the rate of defensive medicine found in a study by Daniel Kessler and Mark McClellan.
  • Stuart Weinstein, the former president of the American Academy of Orthopaedic Surgeons, echoes this result. He has calculated that if a doctor delivers 100 babies a year and pays $200,000 for insurance (the rate in Florida), "$2,000 of the delivery cost for each baby goes to pay the cost of the medical liability premium."

Medical malpractice premiums are growing at four times the rate of inflation, a whopping 12 percent annually.  So why not address them?  Republican senator Mike Enzi of Wyoming has proposed health courts to rule on malpractice lawsuits.  You can guess the fate of this idea.  Obama's Democratic allies in the Senate blocked it.

Republicans could be much more vocal in making tort reform part of their critique of Obamacare.  In doing so, they would also be pointing out that they have proposed solutions for this key contributor to health care costs -- and Obama has not, says Barnes.

Source: Fred Barnes, "Caving to Trial Lawyers," Weekly Standard, September 7, 2009.

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