New Report Questions Republican Support for Medical Malpractice Reform

The U.S. House of Representatives voted yesterday to repeal the Patient Protection & Affordable Care Act (ACA). In the 31st chapter of the “Repeal & Replace” saga, there is still no leadership-backed proposal for “replacing” Obamacare.  But while the House majority offers no clear alternative to the Massachusetts-style ACA that Congress passed in 2010, the Republican-controlled House has acted on medical liability reform.

For instance, the misleadingly named “Help, Efficient, Accessible, Low Cost, Timely, Health Care (HEALTH) Act of 2011” (or HR 5, one of the first bills considered by the current Congress) capped awards for medical malpractice at $250,000 while establishing a 90-day statute of limitations for filing medical malpractice suits. Among the bill’s many gems is a ban on claiming punitive damages in an initial malpractice complaint.

Bills such as HR 5 rely on the assumption that medical malpractice lawsuits – by way of litigation costs and compensatory and punitive awards – are single-handedly increasing the costs of insurance and medical care.

A recent report from Public Citizen debunks that premise, noting that there were fewer medical malpractice payments made in 2011 than in any year since the government started recording such data. Payments this past year were also smaller on average than any year since 1995 and at their lowest in total since 1998. On average, 53% of medical malpractice payments were based on future medical costs.

But supporters of HR 5 are not interested in the future medical costs borne by victims of medical malpractice. All they claim to care about is the impact this type of litigation has on rising overall health care costs. And according to the new report, that impact is nominal at best.

Medical malpractice payments in 2011 were at 0.12% of total health care costs – an all-time low. Similarly, medical liability insurance premiums comprised 0.36% of overall health care costs in 2010, the last year for which data is available.

What the findings of this report show is that, while there are still hurdles to universal access to affordable medical care after the ACA, reforming medical malpractice litigation through HR 5 and similar legislation is not in the patients’ best interest.

Furthermore, the Republican argument that medical malpractice lawsuits are driving up health care costs simply doesn't hold water. Moving forward, Congress should consider legislation that improves access to health care without punishing patients or victims of preventable medical errors. There is simply no reason to excuse medical malpractice so long as it remains the sixth leading cause of death in the United States.

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Medical-Malpractice Narrative Undercut by Simple Reality

Are "skyrocketing" medical malpractice insurance premiums making it impossible for health-care practitioners to keep delivering quality care to patients? That's the current narrative in support of so-called tort reform legislation, but an important article published in Medscape Today (subscription required) undercuts that narrative with simple facts.

Medical groups, including the AMA, have constructed this narrative as part of their push for a legislative "fix" for the so-called problem, and have recently asked the Congressional deficit "supercommittee" to include medical malpractice caps in any deficit-reduction proposal. They've been working to convince patients and politicians that insurance claims are driving up medical costs, and that Washington can rein in health-care costs by enacting a national cap on medical malpractice damage awards for patients who are injured as a result of their medical treatment.

The Medscape Today article notes that despite the rhetoric, medical malpractice insurance premiums have actually been declining.

Although there was a time when the insurance premiums were increasing, the article notes:

[I]n 2011, they declined for the fourth straight year for 3 representative medical specialties, according to a publication called Medical Liability Monitor (MLM). Its annual rate survey, highly regarded in the field, was published this week.

Rates for obstetrician/gynecologists, general internists, and general surgeons decreased on average by a miniscule 0.2% this year after a 0.5% decrease in 2010. Rate decreases of 2.5% in 2009 and 4% in 2008 were more substantial. . . .

[A] downward trend is a downward trend, even though it is leveling out, and another upward trend is not imminent, said Chad Karls, a consulting actuary from a company called Milliman, who edits the MLM rate survey.

"Rates will remain flat in the foreseeable future," Karls told Medscape Medical News.

Medscape acknowledges that it is possible that caps in some states may have contributed to the national decline of insurance rates, but points out that this possibility falls far short of the claims made by supporters of a national cap. Those supporters claim that statewide caps have:

[L]ed to fewer malpractice claims being filed, which in turn has lowered premiums — a pattern attested to by a number of academic articles. However, premiums also have decreased in states, such as Oregon, that do not cap noneconomic damages.

"So caps can't be the only reason," Karls said. "I think the push for patient safety and risk management also has played a role" in reducing claims and premiums.

The article notes that even the American Medical Association seems to acknowledge that the so-called “crisis” in premium rates is no longer a crisis, referring merely to “rising,” rather than “soaring” or “skyrocketing” costs of premiums in a recent letter to the Joint Select Committee on Deficit Reduction which urges the Committee to include medical malpractice caps and tort reform as part of its savings plan for the federal budget.

Alliance for Justice, along with twenty other consumer and patient-safety groups, sent an open letter to the deficit supercommittee refuting the claims of malpractice cap supporters. The letter urges the committee not to include caps in their plan, and lists the many ways in which such caps would actually increase government costs (for example, by making it difficult or impossible to recoup Medicare expenses lost to fraud) while severely compromising patient safety.

For more information on AFJ's efforts to ensure that patients don't lose their rights to seek justice in court, see our Civil Justice webpage.

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