President Targets Malpractice Suits

Physician's Money Digest, February28 2005, Volume 12, Issue 4

Adding up the cost of frivolous malpracticesuits can be an eye-opener,with some estimates putting the totalcost to the health care system at morethan $100 billion a year. That figureincludes both malpractice premiums andthe cost of unnecessary tests that physiciansrequest primarily to prevent potentialmalpractice suits.

At the federal level, malpracticereform has passed the US House severaltimes, only to die in the US Senate. Thistime around, President Bush has largerRepublican majorities in both houses ofCongress to work with, raising the hopesof passing some kind of malpracticereform over the objections of thoseDemocrats who have traditionallyopposed capping awards for noneconomicdamages.

Any malpractice reform bill wouldmost likely be modeled after California's30-year-old cap law, which hashelped to rein in malpractice premiumincreases in that state. Since 1975, malpracticepremiums in the rest of thecountry have risen 3 times faster thanthose in California.

As a result, California hasn't experiencedthe exodus of doctors—particularlyin specialties like neurosurgery andobstetrics—that has occurred in statesthat have been designated as "crisis"states by the AMA. In fact, many OB/GYNdoctors have migrated to California fromneighboring states like Nevada, one ofthe crisis states, where there are no capson jury awards.

The loss of doctors is one reason whytwo of the crisis states, Mississippi andTexas, recently passed laws that cappednoneconomic malpractice awards. In Mississippi,51 of the state's 82 counties facea doctor shortage; in Texas, more thanhalf of the physicians in the state werehit with malpractice suits in recent years.