Massachusetts Think Tank Issues Hackneyed White Paper On Tort Reform

think-tank.jpgLast week, The Pioneer Institute, a Massachusetts think tank, issued a white paper dubiously entitled, “Innovative Medical Liability Reform: Traditional and Non-Traditional Methods,” in an effort to persuade Beacon Hill to adopt tort reform measures that include caps on non-economic damages and protections for medical malpractice insurers that would enable the insurers to pay out medical malpractice settlements and verdicts over time, rather than in lumpsums. The paper is notable not for its contributions to the debate over health care reform, but for the way it parrots the canards of the tort reform movement and shifts focus from the core of health care spending.
Interestingly, nowhere in the white paper is there any mention of the fact that several thousand Massachusetts residents are killed annually by preventable medical errors. It doesn’t really help your crusade to protect doctors and insurance companies when you point out that doctors kill more than 100,000 Americans annually through medical malpractice. Nor does the paper discuss the fact that many deaths due to medical malpractice are preventable. For example, the use of a 19-step surgical checklist has been shown by to reduce medical malpractice by forty-seven percent but only one-fifth of hospitals require the use of such a checklist.
The stated goal of the Pioneer Institute’s Health Care Initiative is “cost containment” and reduction in health care costs. But, as any regular reader of this blog knows, trying to reduce health care costs by changing medical malpractice law is a doomed project since the insurance payouts and legal costs associated with medical malpractice lawsuits amount to one-half of one percent (0.5%) of our total health care spending. When you throw in a generous estimate of the costs of so-called “defensive medicine,” the total cost expended on medical malpractice amounts to $45.6 billion. $45.6 billion sounds like a big number, but when you consider that we spend 16 percent of our $14 trillion GDP on health care costs, you realize that it’s a relative drop in the bucket. And a lot of that spending on medical malpractice is necessary — to compensate the patients who have been maimed by medical malpractice and the families of those who have been killed by it.
The white paper claims, “There is widespread agreement that the majority of tort systems across the country are driving up the cost of health care….by increasing the cost of medical malpractice premiums.” But the cost of medical malpractice premiums are included in the $45.6 billion price tag recently published in the journal Health Affairs. And numerous studies have shown that medical malpractice premiums have not fallen in states that have enacted medical malpractice tort “reform.” This is paradoxical, but the price of medical malpractice premiums, like most insurance premiums, is driven primarily by the investment performance of insurance companies, not payouts on losses. Furthermore, the medical malpractice industry is hardly some shining example of perfect competition, as many states only have several firms issuing policies.
If you were serious about bringing down the cost of health care, you would focus on something other than medical malpractice, such as the fee-for-service model of our health care system that gives hospitals a financial incentive to conduct wasteful tests and procedures.
Medical malpractice “reforms,” like caps on damages, will compound the injury suffered by the victims of medical malpractice. And doctors will not see savings in malpractice insurance costs. The only ones who will benefit will be the insurance companies.
Medical malpractice “reform” is a perennial topic on Beacon Hill. Let’s hope that our legislators don’t buy the snake oil this session.

This blog in maintained by the Boston medical malpractice lawyers at The Law Office of Alan H. Crede, P.C.