No health care plan is complete until it ends the lawsuit abuse that affects virtually everyone. Medical lawsuits and excessive verdicts increase health care costs and result in reduced access to care. Unfortunately, terrible, indefensible mistakes do happen in the healthcare field. When they do, patients should have the right to fair legal representation and fair compensation. However, our current medical tort litigation system often serves the interest of lawyers while driving up costs and delaying justice. The crisis has two components.
The first component is the financial burden on health care providers. Instead of offering you lower prices for their services, American doctors pay as much as $126 billion to protect themselves from lawsuits49 while only 17 percent of lawsuits filed involve actual physician negligence.50 Defensive medicine adds another $70 billion to health care costs.51
The second component is the negative effect on patients. The costs doctors must pay to purchase medical malpractice insurance drives up the cost of care for patients. Furthermore, doctors perform unnecessary medical tests, not for the patient’s benefit, but for the doctors’ benefit to protect themselves from potential lawsuits. The high costs of “defensive medicine” and litigation cause patient care to suffer. When the cost of insurance becomes too high, many doctors relocate or retire prematurely, thereby reducing patients’ access to care. One national study released in 2007 found that America wastes $589 billion on excessive tort litigation.
Additionally, this study indicates that by reforming the civil justice system, 2.4 to 4.3 million more Americans would have access to affordable health insurance coverage. 52 States have attempted numerous solutions to this problem with varying levels of success. The solution traditionally offered to this crisis is some form of cap on patient damages. This was the approach taken by California in the 1970s and it has created a stable medical‐legal environment within the state. States have also begun to explore other options that are just as capable, if not more so, of addressing the second component of this problem—adequately compensating patient injury and improving patient care.
The crucial challenge of medical liability reform calls for innovative, results‐oriented solutions in the form of specialized health courts or other state‐designed options. This is the best way to limit lawsuit abuse without limiting legal justice.
Under this Act, the federal government would financially assist states in establishing solutions to medical tort litigation. These alternatives will offer injured patients the opportunity to receive compensation quickly and fairly—without ultimately losing their access to traditional court systems. At the same time, this Act will help states ensure the accessibility of care for everyone by stopping the rising costs of medical malpractice litigation in this country. Each alternative is entirely run by the state, not the federal government, enabling each state to tailor its solution to its own needs. States may not preclude any party to a dispute from having legal representation at any point in any of the alternatives. Specific solutions include:
Establishing an Expert Panel to Resolve Medical Disputes
Medical malpractice trials often become a “battle of the experts.” Each party hires an expert to testify, and the most convincing expert gains the trust of the jury. Under this Act, states will ensure that experts continue to play a pivotal role in malpractice cases. Instead of the opposing parties picking their own experts, however, the head of the state agency responsible for health will appoint a panel of six independent experts to review each case. Three of the experts will be attorneys, who can bring an understanding of the law relating to the injuries alleged in each dispute. The other three experts will be medical professionals who are particularly qualified to evaluate the type of alleged injury.
The expert panel will reach a determination about whether a health care provider is responsible for a patient’s injury, and if so, what penalty is appropriate. If both the health care provider and patient are satisfied with the decision, they can accept it and end the dispute. Such a swift resolution stands in stark contrast to the months or even years of hearings, trials, and appeals that are currently necessary for a patient to receive compensation for their injuries.
Establishing Independent Health Courts with Qualified Judges for Dispute Resolution States may elect to establish a State Administrative Health Care Tribunal, or “health court” under this alternative. Each health court will be presided over by a judge with health care expertise, who can commission experts and make the same binding rulings that a state court can make. The health court makes a final, binding determination as to liability and compensation using the same legal standard that would otherwise be used in a state court of competent jurisdiction. Even at this point in the process, the parties will receive a much swifter resolution than if they had pursued their case in state court.
Nonetheless, if either party is not satisfied with the health court’s decision, this Act explicitly provides that the states receiving federal funds must allow parties to have access to state courts to appeal the decision. Combination of an Expert Panel and a Health Court The final alternative is a combination of the expert panel and health court systems above. The requirements are the same as the individual models, but this alternative requires a claim to proceed in two steps.
First, the parties must present their case to an expert panel in accordance with the above requirements.
Second, if either party is not satisfied, they must then present their case to the health court. If the parties proceed to the health court, they forfeit any award made by the expert panel.
Finally, if either party is still not satisfied with the result after these two steps, that party may file a claim in state court.
The three solutions to lawsuit abuse would create a fair and efficient system. To encourage parties to rely on these alternatives, parties that appeal to state courts; but are not satisfied with the state court’s decision; forfeit the ability to receive compensation previously awarded by the alternative system. In addition, the Act clarifies that any state that may already have an alternative to litigation in place for a specific category of disease may retain its current system for that category. However, the state must also elect one of the four models in this Act for all other diseases in order to take advantage of the funding opportunity
From the comprehensive version of the Patient's Choice Act. If you want the entire text of the bill, go to Coburn's or Ryan's website. This is a very good bill.
Where does the $589 billion tort cost come from? Do you have a link?
parsy, who is curious
Here’s link and numbers I ran across:
http://www.tortdeform.com/archives/2007/01/mythbuster_series_debunking_my.html
DEBUNKING MYTHS ABOUT TORT SYSTEM COSTS
Every year, an insurance industry-consulting firm, Tillinghast–Towers Perrin, issues a report that claims to estimate what it calls the overall annual “cost” of the U.S. tort system, most recently $261 billion. On the basis of this figure, it then calculates a so-called “tort tax,” supposedly representing tort system costs to each individual.1
1. These figures are bogus and its annual release is little more than a public relations gimmick used by the special interests behind the national “tort reform” movement. In fact, true tort system costs are likely impossible to honestly calculate because court systems do not accurately track such costs. Tillinghast does not even attempt to examine them, as explained below.
But taking one aspect of costs that has received some attention in recent years – total payouts in medical malpractice cases – it is clear how misleading Tillinghast’s figures can be. Medical malpractice payouts, for injuries and deaths caused by medical negligence in the nation, have recently hovered between $5 billion and $6 billion annually.2 This is less than half of what Americans pay for dog and cat food each year.3
BY ITS OWN ADMISSION, TILLINGHAST’S FIGURES HAVE NO RELATION TO THE COSTS OF THE LEGAL SYSTEM.
* Tillinghast admits that it does not examine jury verdicts, settlements, lawyers’ fees, court costs or any actual costs of what might generally be considered “tort costs.” In 2006, Tillinghast acknowledged that its evaluation of the tort system does not include “costs incurred by federal and state court systems” and incredulously states these costs are not even relevant to its estimates.4 That admission is similar to one made by Tillinghast in its 2005 study stating, “the costs tabulated in this study are not a reflection of litigated claims or of the legal system.”5
* Tillinghast’s definition of “tort system costs,” from which the “tort tax” figure is derived, is vastly larger than the actual tort system.
o Included in Tillinghast’s definition of “tort costs” is the immense costs of operating the wasteful and inefficient insurance industry.6 Fully 22 percent of Tillinghast’s “tort costs” are what it calls insurance industry “administrative expenses,”7 (e.g., salaries of executives, rent and utilities for insurance company headquarters, commission paid to agents, advertising and other acquisition costs).
o Tillinghast’s numbers are calculated from the most exaggerated possible source: insurance industry “incurred losses,”8 which are not really “losses” at all. They are mostly estimates - not actual costs - that insurers make in rate filings and have in the past proved to be wildly overstated.9
o On top of that, a huge percentage of “tort costs” identified by Tillinghast concern personal auto insurance, including liability claims for fender benders, for which policyholders pay insurance premiums. The vast majority of these claims are settled without any attorneys being hired or anyone being sued. Identifying these figures as “tort costs” is a huge error.
o Tillinghast admits that it does not factor in the benefits or cost-savings from the tort system. In its 2006 report, Tillinghast notes, “ this study does not attempt to quantify the benefits of the tort system. Such benefits include a systematic resolution of disputes, thereby reducing conflict, possibly including violence. Another indirect benefit is that the tort system may act as a deterrent to unsafe practices and products. From this perspective, compensation for pain and suffering is seen as beneficial to society as a whole.”10
TILLINGHAST FIGURES HAVE BEEN CONSISTENTLY DEBUNKED BY EXPERTS.
* Economic Policy Institute. In 2005, the Economic Policy Institute (“EPI”) released a definitive study debunking common myths about the costs of the legal system and its burden on consumers.11 According to EPI:
o Half of the “costs” that Tillinghast-Towers Perrin attributes to the tort system are not costs in any real economic sense. They are transfer payments from wrongdoers to victim.
o EPI also noted, “There is no historical correlation between the inflated estimates of the costs of the tort system and corporate profits, product quality, productivity, or research and development (R&D) spending. Evidence suggests that the tort system, without the proposed restrictions, has actually been beneficial to the economy in all these areas.”
* Business and News Publications.
o Business Week called the 2005 Tillinghast report a “wild exaggeration,” stating that it “includes everything from payouts for fender-benders to the salaries of insurance industry CEOs.”12
o The Wall Street Journal said in an article, “…critics of past years’ studies – and there are many – say the number and the projections that come with it are deeply flawed. For instance, they include payments that don’t involve the legal system at all. Say somebody smashes his car into the back of your new SUV and his insurance company sends you a $5,000 check to fix the damage. That gets counted as a tort cost in Tillinghast’s number. Critics say it’s just a transfer payment from somebody who wasn’t driving carefully to somebody who has been legitimately wronged. How is that evidence of a system run amok?”13
o Congressional Quarterly: “Nearly all the assertions about the growing cost of the tort system are based on the figures from just one actuarial and management consulting firm, Tillinghast Towers-Perrin, that works for the insurance industry, which has a stake in limiting lawsuits … The company’s estimates of tort costs include the insurance industry’s administrative expenses and payments on claims that never involve courts or lawyers, such as auto collisions.”14
o Washington Monthly: Tillinghast “includes in its definition of the ‘tort system’ insurance company administrative costs and overhead and the salaries of highly paid insurance company CEOs … One thing TTP doesn’t include: court budgets, which makes its study seem a lot more like an assessment of the insurance industry than of the legal system.”15
* Capra Report. In a January 29, 1999 independent study prepared for the New York State Bar Association, Daniel Capra, Philip Reed Professor of Civil Justice Reform at Fordham University School of Law, said, “[A]ny cries about a ‘tort tax’ are nothing but absurd and self-serving overkill.”16 Professor Capra also found:
o “The analysis of the costs of the tort system creates the unfair inference that the cost is caused solely by plaintiffs lawyers and frivolous litigation — when in fact most of the cost of the system is the result of corporate wrongdoing causing injury, and ‘hardball’ litigation tactics of insurance companies that deny legitimate claims.”
o “[T]he quasi-statistical analysis about the costs of the tort system fails to mention that the system provides the essential benefits of victim compensation and product safety. Any focus on costs without consideration of countervailing benefits is completely irresponsible.”
o The “tort tax” figure “is particularly disingenuous given the record profits of insurance companies and their executives.”
o “[T]he cost of the tort system to business is remarkably low when compared to business income and profits.” (link)
parsy, who thinks having some good numbers would be helpful