September 24, 2023

Benjamin Better

Better Get Computer

How Obama’s Healthcare Reform Bill Encourages Tort Reform

How Obama’s Healthcare Reform Bill Encourages Tort Reform

On December 24, 2009, in a straight party-line vote, the Senate passed amended House of Representatives bill HR 3590 entitled “The Patient Protection and Affordable Care Act” but commonly known as the Obama Administration health care reform bill. While the Senate must still iron out any differences with the original House of Representatives bill in committee, there is a substantial likelihood that some form of reform will be passed. This achievement has been heralded by consumer advocates across the country.

However, it would be wise for the pundits and supporters to exercise caution should the bill pass. Many concerns have been voiced amongst opponents including that the bill may actually raise costs, diminish medical advancements and research, and create a stratified health care system between those receiving the government paid care and those who can afford to pay cash for desired medical treatment. Yet, one of the most probable results and consequences of the reform bill has not been discussed: the inevitable implementation of nationwide medical malpractice tort reform.

Tort reform has been raised by opponents as a necessary element of reform. Their argument, which has existed for decades to support damage caps and limits of liability for doctors, is that medical treatment is expensive in large part to lawsuits brought by patients against their doctors and health care providers because of alleged medical negligence. These lawsuits have forced medical malpractice insurance companies to raise insurance premiums for doctors across the board, particularly in risky fields such as obstetrics and cardiology. In turn, the high health insurance premiums are passed along to the patient in the form of higher prices and health insurance costs. Their position, in sum, is that any discussion of health care reform designed to reduce medical costs must include implementation of limits on civil damage and liability for doctors.

Prior to the health care reform bill there was some validity to this theory. If one assumes that health care is a valuable public resource or right and the government has an interest in managing the cost and accessibility of health care for the public, then medical malpractice tort reform may very well be allowed a special exception in general tort law that would bar or limit monetary compensation for injured patients in some cases.

Without further addressing the validity of this argument–much of which is demonstrably false through readily available facts such as medical malpractice insurance company profits derived solely by the high premiums charged to doctors compared to claims paid to injured patients–the argument for medical malpractice tort reform will only be strengthened with the passage of the reform bill. In fact, national medical malpractice tort reform is all but guaranteed as the government’s interest in managing health care costs moves from theoretical to real.

We know very little about the health care reform bill. One thing we do know, though, is that the bill will create a board called the “Independent Medical Advisory Board”–a government bureaucracy tasked with cutting health care costs. This panel has been famously been called a “death panel” by former Vice-Presidential Nominee Sarah Palin because it would arguably ration health care procedures as a way to eliminate or reduce the frequency of procedures which provide less benefit than the costs that are incurred (e.g., unnecessary diagnostic testing, barring payment of mammograms for women under 50, etc.). Regardless of what the panel is euphemistically called, rationing will be an inevitable result to save the government and taxpayer costs on the front end side of the health care transaction.

Equally likely, the Board will eventually adopt medical malpractice tort reform as a way to limit costs on the back end side of the health care transaction. Like MediCare and Medicaid, doctors and health care providers will be asked to accept artificially low payments for their service thereby reducing their profit margin and their willingness to participate in the new federal health care system. One incentive the government can provide to these doctors–perhaps the only incentive–is to assist in reducing malpractice insurance costs by limiting medical malpractice lawsuits and damages.

Medical malpractice reform has already been raised by the American Medical Association as a way President Obama can earn their members support during the passage of this controversial bill. Understandably, Obama has been reluctant to agree to such a concession as both he and the Democratic Party rely heavily on the donations of trial lawyers for their political future. Yet, what happens when the Republicans win the White House, political favor turns, or the cost of the federal health care program skyrockets? Undoubtedly, pressure would mount for tort reform to be implemented, perhaps to such a level that politicians and bureaucrats would be forced to concede.

This is a sad, inevitable, and ignored consequence of the proposed health care reform bill. Under most states’ medical malpractice statutes, a doctor cannot be found liable for injuring a patient unless their care fell “below the standard of care within the community”. That means a doctor must not be merely negligent, but nearly grossly negligent, before he can be found responsible for his patient’s injuries caused by his treatment. Clearly, doctors who meet this standard should be held responsible for their conduct and their patients should be compensated. To balance part of the nation’s health care costs on the backs of these injured patients is simply wrong.