Tort reform key to cutting soaring healthcare costs
There are many reasons that most Americans strongly oppose the Washington health care takeovers being considered by Congress.
While families and businesses are struggling against skyrocketing health care costs, the Democrats’ plan would increase premiums by 10-13% for families buying coverage on their own. And though the next generation will be forced to address a $12 trillion national debt, the President has proposed spending another $2.5 trillion on new entitlement programs.
Meanwhile, the process by which Obamacare is being jammed through Congress is Washington at its worst–backroom negotiations, special pork-barrel deals, and procedural tricks in both houses of Congress.
But there is another reason to oppose Obamacare; the bill being debated in the House includes special payoffs for trial lawyers that will encourage wasteful litigation against doctors and increase the overall costs of health care for patients.
Frivolous medical malpractice lawsuits already cost Americans billions of dollars annually.
According to the Harvard School of Public Health, 40% of medical malpractice suits filed in the U.S. are “without merit.” These predatory suits amount to legalized extortion and require doctors to purchase malpractice insurance at great expense. A Department of Health and Human Services study found that unlimited excessive damages add between $70 billion and $126 billion annually to health-care costs.
Doctors are so worried about frivolous lawsuits that they order unnecessary — and expensive — tests and procedures. The Massachusetts Medical Society found that 83% of its doctors practice this sort of defensive medicine. The costs of litigation and defensive medicine are passed on to the patient in the price of health care.
That’s why some states, including my home state of Texas, have enacted lawsuit-abuse reform to limit the amount of excessive damages that can be awarded. The result? More than 14,000 doctors have returned to Texas or set up new practices in the state. That means Texans pay less to have better health care and more options.
Based in part on the state-level success of tort reform, the Congressional Budget Office estimates that lawsuit-abuse reform would save federal taxpayers $54 billion over the next decade.
Despite clear and convincing evidence that lawsuit-abuse reform works, Democrats refuse to include meaningful reforms in their proposals.
Instead, they’ve incorporated provisions that would make lawsuit abuse even worse!
The House bill contains grant money for states to adopt alternatives to litigation, such as health courts. Alternatives to litigation can be useful when they are fair to both sides. But the version contained in Obamacare is radically tilted in favor of plaintiffs’ lawyers.
To be eligible for federal grant money, a state’s alternative process must allow the plaintiff (trial lawyer) to opt out “at any time.” So even if a trial lawyer brings a claim before the new forum and loses, they are still free to “opt out” and file in court to take their chances with a jury. While trial lawyers will get two bites at the apple, doctors will be bound by the results of either ruling and have no right to opt out. It is no wonder that the trial lawyers’ top lobbyist in Washington declared this opt-out provision a “stunning victory.”
The bill also creates a new federal bureaucracy that will encourage lawsuits against doctors and spur more defensive medicine. The bill attempts to control costs by creating a “Patient-Centered Outcomes Research Institute” to research the costs and benefits of various courses of medical treatment and make recommendations on care for specific diagnoses.
Any doctor who deviates from the dictates of the bill’s new bureaucracy will risk having that deviation used against them in court.
For example, doctors who recommend an extra measure of care that the government considers “inefficient” will put themselves at risk of a lawsuit.
Trial lawyers will not hesitate to use any deviation from federal guidelines to accuse doctors of failing to follow professional standards. Inevitably, the trial bar will serve as enforcers of the dictates of Obamacare against doctors.
Obamacare will put doctors at new risk for lawsuits, driving up health care costs and undermining the successful lawsuit-abuse reforms of Texas and other states. Lawsuit-abuse reform works. We can’t have real health care reform without it.
Rep. Lamar Smith (R-TX) is the Ranking Republican on the House Judiciary Committee.
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