Some cheered when details of the Trump administration’s five-point plan for lowering health care costs was revealed during the president’s address to Congress on Feb. 28, 2017. Item four drew special, largely negative attention for being both a decades-old idea and one that has consistently proven both ineffective for curbing increases in U.S. health spending and violative of basic constitutional rights.
In proposing “legal reforms that protect patients and doctors from unnecessary costs that drive up the price of insurance and work to bring down the artificially high price of drugs,” White House policymakers ignore more than 20 years of research and display their indifference toward or disrespect for the Seventh Amendment. That forgotten inalienable right ensures people who suffer injuries, illnesses or death due to the negligence or recklessness of another person or organization can seek compensation and damages in jury trial in civil court.
While no one has yet spelled out exactly which “legal reforms” are intended, past experience in the more than 30 states that have enacted so-called tort reform shows that pressure will be put on federal agencies and members of Congress to place caps on awards for noneconomic damages, force plaintiffs into arbitration, and severely limit the types of claims against doctors, nurses, pharmacists, dentists, hospitals, clinics, nursing homes and long-term care facilities that can go to a jury rather than being assigned to a single judge.
The Problems Tort Reform Purportedly Solves Do Not Exist
Champions of limiting plaintiffs’ access to the courts usually talk about medical malpractice. They focus on such suits because they believe that most of the actions are unwarranted and that fears of getting sued lead health care providers to practice defensive medicine and insurance companies to jack up premiums. In turn, the theory goes, higher medical malpractice coverage costs force people out of the medical profession.
On March 1, 2017, Judson Philips, writing in the Washington Times, a publication normally fully on-board with the Republican agenda in DC, noted, “Unfortunately, President Trump has bought into the myth of the frivolous lawsuit. Frivolous lawsuits are a fable made up by the Chamber of Commerce and big insurance, which want to deny citizens their day in court. Lawyers don’t file frivolous lawsuits because they don’t make money from them.”
Moving from observation to analysis, health care economists who reviewed 10 years of emergency department claims to Medicare from three states that had adopted laws making it essentially impossible for patients and families to sue ER personnel for malpractice found that the purported reforms did nothing to reduce “practice intensity, as measured by the rate of the use of advanced imaging, by the rate of hospital admission, or in two of three cases, by average charges. Although there was a small reduction in charges in one of the three states (Georgia), our results in aggregate suggest that these strongly protective laws caused little (if any) change in practice intensity.”
The authors of the study in the Oct. 16, 2014 issue of the New England Journal of Medicine concluded:
In the context of the existing literature, our findings suggest that physicians are less motivated by legal risk than they believe themselves to be. Although a practice culture of abundant caution clearly exists, it seems likely that an aversion to legal risk exists in parallel with a more general risk aversion and with other behavioral, cultural, and economic motivations that might affect decision making. When legal risk decreases, the “path of least resistance” may still favor resource-intensive care. Our results suggest that malpractice reform may have less effect on costs than has been projected.
The other shaky legs of the tort reform argument were neatly kicked out in a summary Steve Chen published on the Forbes website on March 2, 2015. He points to studies going back to the 1990s that reveal how laws designed to keep medical malpractice victims out of court did nothing to slow surges in health spending. One especially damning fining by the U.S. Justice Department was that “the median med mal award in jury-decided cases was $400,000. In bench trials, where the judge also serves as the jury, the median award was $631,000.” Further, “only 1 percent of all adverse medical events ever result in any sort of legal action being initiated.”
What Tort Reform Looks Like in Virginia
Virginia, where my medical malpractice and personal injury law firm colleagues have our main offices, extends tort reform to all civil legal actions. After several years of capping noneconomic damages at $250,000 or $350,00, the commonwealth in 2013 instituted a general cap on all types of damages. The allowed total award amounts started at $2.1 million for suits initiated prior to June 30, 2014. It will be increased to $3 million in 2031.
Since many victims of medical errors, car crashes, dangerous and defective products, and slips and falls can face lifelong disabilities and a lifelong need for expensive care, artificially capping the money they can receive from those who harmed them represents nothing like justice. Worse, basing caps on incorrect assumptions and disproven myths represents a failure to engage with reality.