I linked last Saturday to John Mackey’s piece on eight free-market health-care reforms that would actually work and not balloon the deficit. One of the necessary steps he laid out was “Enact tort reform to end the ruinous lawsuits that force doctors to pay insurance costs of hundreds of thousands of dollars per year.” This morning, Sarah Palin elaborated on that pointin a note she posted on her Facebook page:
President Obama’s health care “reform” plan has met with significant criticism across the country. Many Americans want change and reform in our current health care system. We recognize that while we have the greatest medical care in the world, there are major problems that we must face, especially in terms of reining in costs and allowing care to be affordable for all. However, as we have seen, current plans being pushed by the Democratic leadership represent change that may not be what we had in mind—change which poses serious ethical concerns over the government having control over our families’ health care decisions. In addition, the current plans greatly increase costs of health care, while doing lip service toward controlling costs.
We need to address a REAL bipartisan reform proposition that will have REAL impacts on costs and quality of patient care.
As Governor of Alaska, I learned a little bit about being a target for frivolous suits and complaints (Please, do I really need to footnote that?). I went my whole life without needing a lawyer on speed-dial, but all that changes when you become a target for opportunists and people with no scruples. Our nation’s health care providers have been the targets of similar opportunists for years, and they too have found themselves subjected to false, frivolous, and baseless claims. To quote a former president, “I feel your pain.”
So what can we do? First, we cannot have health care reform without tort reform. The two are intertwined. For example, one supposed justification for socialized medicine is the high cost of health care. As Dr. Scott Gottlieb recently noted, “If Mr. Obama is serious about lowering costs, he’ll need to reform the economic structures in medicine—especially programs like Medicare.” [1] Two examples of these “economic structures” are high malpractice insurance premiums foisted on physicians (and ultimately passed on to consumers as “high health care costs”) and the billions wasted on defensive medicine.
Dr. Stuart Weinstein, with the American Academy of Orthopaedic Surgeons, recently explained the problem:
The medical liability crisis has had many unintended consequences, most notably a decrease in access to care in a growing number of states and an increase in healthcare costs.
Access is affected as physicians move their practices to states with lower liability rates and change their practice patterns to reduce or eliminate high-risk services. When one considers that half of all neurosurgeons—as well as one third of all orthopedic surgeons, one third of all emergency physicians, and one third of all trauma surgeons—are sued each year, is it any wonder that 70 percent of emergency departments are at risk because they lack available on-call specialist coverage? [2]
Dr. Weinstein makes good points, points completely ignored by President Obama. Dr. Weinstein details the costs that our out-of-control tort system are causing the health care industry and notes research that “found that liability reforms could reduce defensive medicine practices, leading to a 5 percent to 9 percent reduction in medical expenditures without any effect on mortality or medical complications.” Dr. Weinstein writes:
If the Kessler and McClellan estimates were applied to total U.S. healthcare spending in 2005, the defensive medicine costs would total between $100 billion and $178 billion per year. Add to this the cost of defending malpractice cases, paying compensation, and covering additional administrative costs (a total of $29.4 billion). Thus, the average American family pays an additional $1,700 to $2,000 per year in healthcare costs simply to cover the costs of defensive medicine.
Excessive litigation and waste in the nation’s current tort system imposes an estimated yearly tort tax of $9,827 for a family of four and increases healthcare spending in the United States by $124 billion. How does this translate to individuals? The average obstetrician-gynecologist (OB-GYN) delivers 100 babies per year. If that OB-GYN must pay a medical liability premium of $200,000 each year (which is the rate in Florida), $2,000 of the delivery cost for each baby goes to pay the cost of the medical liability premium.” [3]
You would think that any effort to reform our health care system would include tort reform, especially if the stated purpose for Obama’s plan to nationalize our health care industry is the current high costs.
So I have new questions for the president: Why no legal reform? Why continue to encourage defensive medicine that wastes billions of dollars and does nothing for the patients? Do you want health care reform to benefit trial attorneys or patients?
Many states, including my own state of Alaska, have enacted caps on lawsuit awards against health care providers. Texas enacted caps and found that one county’s medical malpractice claims dropped 41 percent, and another study found a “55 percent decline” after reform measures were passed. [4] That’s one step in health care reform. Limiting lawyer contingency fees, as is done under the Federal Tort Claims Act, is another step. The State of Alaska pioneered the “loser pays” rule in the United States, which deters frivolous civil law suits by making the loser partially pay the winner’s legal bills. Preventing quack doctors from giving “expert” testimony in court against real doctors is another reform.
Texas Gov. Rick Perry noted that, after his state enacted tort reform measures, the number of doctors applying to practice medicine in Texas “skyrocketed by 57 percent” and that the tort reforms “brought critical specialties to underserved areas.” These are real reforms that actually improve access to health care. [5]
Dr. Weinstein’s research shows that around $200 billion per year could be saved with legal reform. That’s real savings. That’s money that could be used to build roads, schools, or hospitals.
If you want to save health care, let’s listen to our doctors too. There should be no health care reform without legal reform. There can be no true health care reform without legal reform.
—Sarah Palin
[1] Seehttp://online.wsj.com/article/SB10001424052970204409904574350370729883030.html?mod=googlenews_wsj
[2] See http://www.aaos.org/news/aaosnow/nov08/managing7.asp
[3] Id.
[4] Seehttp://www.abajournal.com/magazine/new_laws_and_med_mal_damage_caps_devastate_plaintiff_and_defense_firms_alik/print/
[5] See http://www.washingtonexaminer.com/opinion/columns/OpEd-Contributor/Tort-reform-must-be-part-of-health-care-reform-8096175.html