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Trial lawyers playing defense on health care reform? Really?



Medical malpractice and liability reform DID come up yesterday at President Obama's town-hall-style-flavored event on health care. Rep. Michael Burgess (R-TX), a physician, drew attention to Texas' success in capping non-economic damages and challenged the President to push for reforms that work. (Burgess has introduced the Medical Justice Act, HR 1468, to establish national liability limits.)

The President responded by reprising his June 15th remarks in Chicago to the AMA:

I don't like the idea of just an artificial cap. I do want to work with doctors to find ways that we can reduce their liabilities where they haven't done anything wrong, where they've performed effectively. I want to see, are there ways that we can reduce the constant threat of lawsuits that doctors and hospitals experience, because I do think that that causes defensive medicine. And so I've committed to working with the AMA to see ways that we can reduce some of these litigation costs and malpractice rates.

If this were really a priority, wouldn't we be seeing a high level of activity, table pounding and persuasion coming from the trial lawyers? News releases, op-eds, floor speeches? Have you seen anything on the TV about medical liability reform?

The silence speaks for itself. Roll Call interviewed the American Association for Justice's Linda Lipsen after the President's AMA speech, and she said the expected things, but two weeks later the story's headline seems unwarranted: "Trial Lawyers Now Playing Defense."

As the Wall Street Journal editorialized post-AMA in "Obama's Malpractice Gesture," "Mr. Obama's cri de coeur might have had more credibility had he not specifically ruled out the one policy to deter frivolous suits."

In the extended entry below you'll find the transcript of yesterday's event dealing with malpractice, as well as Rep. Burgess' response to the President.

From the White House transcript.

VIDEO Q Mr. President, as a physician, I know the cost of defensive medicine drives medical costs upward. Now, at your health care forum you said that you wanted to find out what works. In my home state of Texas, we know what works, and our Medical Justice Act has done just that.

Now, unfortunately, you recently told the AMA you were opposed to capping non-economic damages, even though a state like mine has proven that it does work. Now, will you reaffirm your commitment to find out what works and then ask Congress for its implementation?

THE PRESIDENT: Okay. I want to make sure everybody understands the question here. A lot of doctors have argued -- and in some cases they're justified -- that their costs for medical malpractice insurance, the threat of a lawsuit if something goes wrong with a patient, even if it's not their fault, is so high that not only is it increasing their out-of-pocket cost, but they're also engaging in what's called defensive medicine; that they've got to order five tests when one is enough just to make sure that they're covered so that if something goes wrong that's not their fault later, they can say, look, I did everything possible -- even if a lot of that isn't required.

And so the argument is if you can cap the pain and suffering or the liability that is awarded as a consequence of you being hurt in the hospital or by a doctor, that that would drive down everybody's costs.

Now, what I've said is that I don't like the idea of an artificial cap on somebody if the doctor or the hospital really was negligent. And in some cases, I've got to tell you, they are. I mean, there are cases where folks leave a sponge in your gut and sew you back up, and after a while you're feeling worse than when you went in. And in some cases, obviously that can cause very severe damage, and I want to make sure that people's pain, suffering, out-of-pocket expenses, that those are covered.

So I don't like the idea of just an artificial cap. I do want to work with doctors to find ways that we can reduce their liabilities where they haven't done anything wrong, where they've performed effectively. I want to see, are there ways that we can reduce the constant threat of lawsuits that doctors and hospitals experience, because I do think that that causes defensive medicine. And so I've committed to working with the AMA to see ways that we can reduce some of these litigation costs and malpractice rates.

One point that I've got to dispute, though, with the gentleman who asked me the question -- he says he's from Texas, and that we've got caps in Texas, and so we've seen what works. Well, the fact is, is that there was just recently an article about a town called McAllen, Texas, where they have the highest health care costs in the country. It's down by the border. And even though they have caps there, in McAllen, Texas, they spend about three times as much per person as -- or not -- they spend about 30 percent more per person than they do in El Paso, Texas, which also is operating under caps. So what that tells me is the problem of rising costs doesn't simply have to do with whether or not liability is capped. What it really has to do with is the incentives that are operating in various communities.

There are some places, like the Mayo Clinic, many of you have heard of, provides outstanding care, some of the best in the world. People fly in from everywhere to go to Mayo Clinic to get treated. Turns out Mayo provides care much more cheaply than a lot of other health systems, even though it's better care. And part of the reason is they do some things that are commonsensical, but unfortunately we don't do in the health care system.


"Burgess Response To President Obama's Answer To His Question On Medical Liability Reform":

First and foremost, I would like to thank those of you who viewed my YouTube question to President Obama for today's White House online town hall on health care. It is very important that all Americans stay involved and engaged throughout the health care debate, and today's town hall made it possible for me to directly ask President Obama this important question on medical justice reform, and it would not have been possible without your help.

On the issue of medical justice reform, I am pleased to hear that President Obama and I share the common goal of reducing medical liability insurance rates and the constant threat of lawsuits many doctors and hospitals face. Let me be clear - my goal is not to deny a patient who has been legitimately harmed what is due to them. Instead, I want to make sure that overzealous trial attorneys and the unmerited lawsuits they often bring about do not compromise the care provided by a doctor to his or her patient.

My home state of Texas has shown that capping non-economic damages has only made the medical environment better. Since the reforms were implemented in 2003, Texas has seen thousands of new doctors, nurses and medical professionals flock to the state, the number of health care insurance companies has increased, giving patients more choice, and doctors have been able to provide the best care possible to their patients without fear of unwarranted lawsuits.

While I do not think caps on non-economic damages are the only way to reduce costs and the practice of defensive medicine, it is without a doubt an important aspect of medical justice reform.

On President Obama's other point - the issues raised by the New Yorker article in regards to higher utilization rates in McAllen, Texas, are complex, and are not likely to be directly caused by, or solved by, medical liability reform. This may just as likely point to one of the weaknesses of a government-run payment system - Medicare - as it does any other matter. This issue deserves careful study, which is why I am asking the Government Accountability Office to provide more answers on the study's results.

As the health care debate heats up over the coming weeks, I look forward to continuing to hear from Americans all across the country - individuals, small businesses, and those with innovative ideas that have worked - on ways we can improve our country's health care system.


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Isaac Gorodetski
Project Manager,
Center for Legal Policy at the
Manhattan Institute
igorodetski@manhattan-institute.org

Katherine Lazarski
Press Officer,
Manhattan Institute
klazarski@manhattan-institute.org

 

Published by the Manhattan Institute

The Manhattan Insitute's Center for Legal Policy.