Medical malpractice reform as debt reduction strategy doesn't make sense

Fixing our country’s economic situation is no small task and it certainly involves tough decisions about programs and issues that affect all of us. Apparently, one of the many options being discussed is reform to our medical liability system—possibly to the detriment of patients.

If you haven’t followed the news closely, a Congressional “Super Committee” called the Joint Select Committee on Deficit Reduction was formed this year to figure out a strategy for getting rid of our debt. And just this month, the American Medical Association (AMA), along with dozens of other medical organizations, submitted a written request to the Super Committee, requesting that they consider medical liability reform as part of a debt reduction strategy.

The AMA claims that the reforms, if adopted nationally, could reduce the federal deficit by $62.4 billion over 10 years. That may seem like a big number, but it is less than one-half of 1% of the total deficit that the Super Committee is dealing with. When the savings are that small, it begs the question of what’s the cost to the individual. The suggested reforms seek to completely protect health care providers from liability in certain situations, and place some limits on the types of evidence that can be presented in medical liability cases. But perhaps the most controversial aspect of the requested reforms is a $250,000 cap on non-economic damages.

This requested limitation would apply across the board—regardless of the type of injury suffered or whether the defendant is a nurse, physician, specialist, an institution, or any other “health care provider”. In addition, “non-economic damages” include a wide range of damages for which plaintiffs typically seek recovery. For example, those non-tangible damages such as emotional and physical pain and suffering, loss of enjoyment of life, and disfigurement are all non-economic damages. As you can imagine, it is difficult to put a price on those types of damages and each individual plaintiff’s case is unique and deserves individual attention.

The AMA cites escalating and unpredictable awards, high defense costs, and meritless lawsuits as contributing to an increase in health care costs. But as we’ve written about before (IA) as we’ve written about before (NE), the research doesn’t back up these claims. In addition, the American Association for Justice has numerous resources on medical negligence and the importance of the civil justice system in protecting patients. Much of the data they’ve collected stands in stark contrast to claims made by doctors and insurance companies about skyrocketing costs and meritless lawsuits.

If we’re going to have a debate about medical negligence and reform, it should be based on real data and that debate should be put in perspective: like the fact that the national savings expected are only a tiny fraction of the national debt; or the fact that medical negligence in 2009 only accounted for 0.3% of total health care costs.