In the Weekly Standard, Fred Barnes tackled the issue of tort reform and healthcare reform. It seems that ever since former DNC Chairman Howard Dean (a former doctor) stated that tort reform was not part of the bill because Congress did not want to have to take on the trial lawyers in addition to everyone else, people have been talking about this more and more.
How can you discuss a massive overhaul of our healthcare with out looking at one of the biggest drivers of cost in healthcare? Barnes points to a study that was done in the Massachusetts Medical Society where 83% of doctors say they practice defensive medicine. He also looked at medical malpractice insurance. If doctors have to pay $200,000 annually in malpractice insurance, you can be assured that patients will be paying more.
Yet when you look at states like California and Texas, which put caps on punitive damages, both of these states have seen dramatic decreases in their insurance rates. Texas has seen a reduction of 21%. If you compare three states according to Californians Allied for Patient Protection (CAPP), you will see how dramatic it becomes. After California instituted caps, an OBGYN pays about $89,953 annually in malpractice insurance. In New York, which does not have caps, that same OBGYN will pay $194,935 and in Florida that same professional will $214,893.
California has a cap of $250,000. If you attempted to raise that cap to $500,000 it would increase California healthcare costs by $7.9 billion. That would would translate into $1,032 for a family of four, according to CAPP. This is why the trial lawyers are constantly testing the waters in other states or challenging MICRA in the courts. MICRA works and the trial lawyers know it.
For the President (a lawyer) and Congress (a lot of lawyers) not to include tort reform as a major element of healthcare reform is a complete slap in the face to the American people. Americans deserve a better healthcare system, but to ignore tort reform is to ignore the 800 lb. gorilla in the room.
This piece is cross-posted at CALA.com.