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: Personal Injury and Social Security Disability BlogHealth Care and the Myth of Tort Reform
By Robert Kraft
Plenty of reasons exist to support medical malpractice reform. Doing it to slow the dizzying growth in health care spending isn't among them.
Whatever
form those projects might take, few economists believe tort reform by
itself ? even the most radical tort reform ? would significantly reduce
what
Americans spend on health care. Most experts say the big reasons for
high U.S. health spending are chronic illness, expensive new medical
technology and an
aging population. Lawsuits are far down the list.
The most
authoritative estimates put the direct cost of malpractice litigation ?
insurance premiums, lawyers fees and awards to injured patients ? at
about 2
percent of overall health care spending. Premiums make up about half of that.
Even the
most aggressive tort reform wouldn't save all of the direct costs. The
biggest portion of malpractice settlements and jury awards are not for
"pain
and suffering" or punitive damages, but for actual damages ? lost income.Ned future medical treatment.
Meanwhile, insurance companies providing malpractice insurance are doing pretty well. Last year in Missouri, they paid out only $1 in awards for every $5 they collected in premiums. The number of claims in 2008 was the lowest in the 30 years.
In
states that have enacted some measure of tort reform, including
Missouri, which limited so-called non-economic damages in 2005, health
care spending is
rising just as fast as it is elsewhere. It hasn't declined in any state, no matter what legal reforms were put in place.
A 2006 report by the Congressional Budget Office found that there were no reliable studies that showed tort reform by itself reduced health care spending.
One
point made by tort reformers is undeniably true: Some people awarded
damages under the current system aren't victims of malpractice; they're
victims
of bad outcomes. Even with the best care, people sometimes die or
suffer serious injuries. Those patients deserve sympathy, not
compensation.
It also
is true that many, if not most, victims of malpractice never file suit,
often because the cost of bringing suit is more than what they could
hope to
recover. Those patients deserve compensation for their actual injuries.
Many opponents of Mr. Obama's reform plans point to tort reform as a kind of silver bullet to reducing health care costs. Like many of their claims, the facts don't bear that out.
Full post as published by Personal Injury and Social Security Disability Blog on September 23, 2009 (boomark / email).
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