Would Tort Reform Lower Costs?
One of the issues that consistently comes up in legislative sessions is the idea that we can save all kinds of time and money in our legal system by implementing tort reform. An excellent article on this subject appeared recently in the New York Times. Here’s a link to the article and a couple of quotes. http://prescriptions.blogs.nytimes.com/2009/08/31/would-tort-reform-lower-health-care-costs/Tom Baker, a professor of law and health sciences at the University of Pennsylvania School of Law and author of “The Medical Malpractice Myth,” spoke with freelance writer Anne Underwood.
Q. But critics of the current system say that 10 to 15 percent of medical costs are due to medical malpractice. A. That’s wildly exaggerated. According to the actuarial consulting firm Towers Perrin, medical malpractice tort costs were $30.4 billion in 2007, the last year for which data are available. We have a more than a $2 trillion health care system. That puts litigation costs and malpractice insurance at 1 to 1.5 percent of total medical costs. That’s a rounding error. Liability isn’t even the tail on the cost dog. It’s the hair on the end of the tail.
Q. If medical malpractice doesn’t explain the high costs of our health-care system, what does? A. A variety of things. The American population is aging. We’ve had advances in technology that are expensive. We’re also a rich nation, and the richer you get, the more money you spend on health care. And compared to other countries, we have heavy administrative costs from the private-insurance system.
Couple this interview with one recent case from Kansas where a woman went in to have her right ovary removed but the doctor removed her left ovary. Due to an award cap, the judge struck down the jury decision of $759,680 for current and future medical bills, pain and suffering, inability to perform services as a spouse, and other non-economic losses, and instead awarded the state cap of $250,000. A jury of peers examined all the proper evidence and determined a fair amount, and this law now usurps their role in calculating proper damages on a case by case basis. http://www2.ljworld.com/news/2009/oct/25/botched-surgery-case-test-pain-suffering-limits