DMI on the 2007 State of the Union
Health Care:

Malpractice Liability Caps

President Bush: We should work to decrease the cost of medical care by reducing medical errors and limiting liability for medical malpractice.

· “We need to…reduce costs and medical errors with better information technology… and protect good doctors from junk lawsuits by passing medical liability reform.”

DMI SAYS: “We agree that reducing medical errors will decrease the cost of medical care. However, Bush’s proposal to limit liability for medical malpractice will only increase the frequency of medical errors because it eliminates a critical incentive for maintaining high quality patient care.”

* President Bush is right that part of the reason for the high cost of health care is the high number of medical errors.
* However, in the second part of his proposal, President Bush calls for capping medical malpractice liability. Capping malpractice liability limits the amount of money patients can receive when injured by their doctor’s negligence, and can effectively grant doctors immunity from the consequences of their malpractice. Capping liability for lawsuits is actually likely to increase the amount of medical errors that Bush agrees contribute to the cost of healthcare.
* The President’s own logic undercuts his call to implement these liability caps. In the absence of the “better information technology” that Bush agrees will “reduce medical costs and errors,” the threat of malpractice lawsuits is one of the primary means of controlling medical errors and their increased costs, as well the primary means of holding bad doctors accountable. Moreover, lawsuits are the only means of actually compensating the injured victims of medical malpractice.
* The President’s proposal would eliminate a critical incentive for maintaining high quality patient care. Most doctors are good doctors. Indeed, only a small group of “bad” doctors (5.9%) are responsible for the majority of all medical malpractice payments (57.8%). Because medical professional associations rarely discipline even the worst members of their profession, there are few other means available aside from lawsuits for holding them accountable.
* Instead of protecting “good” doctors from “junk” lawsuits, President Bush’s proposal mechanically protects all doctors whenever they make any kind of mistake. Just like good people do bad things, good doctors sometimes make mistakes and injure people who need to be compensated.
* Medical malpractice liability costs – including all malpractice payouts, settlements, and legal fees – only account for 1 percent of the nation’s health care expenditures. Clearly, this is not a significant contributor to rising health care costs. Indeed, even the Congressional Budget Office found that implementing Bush’s proposal would only reduce health care costs by at most half of one percent.
* One guaranteed way to reduce the cost of medical care is not to “reform” malpractice lawsuits, but to enact patient safety reforms that will reduce the current 44,000-98,000 annual deaths and 300,000 annual injuries resulting from preventable medical errors, as well as the $1.5 million medication errors that total $3.5 billion in unnecessary expenses each year. In short, the best way to get rid of the lawsuits President Bush complained about this evening is to modernize the practice of medicine and eliminate the avoidable medical errors that are the only reason these lawsuits exist.
* Bush’s liability caps would also fall disproportionately on women, people of color, children, the elderly, and working people.

Relevant Statistics:

· Percentage of health care costs in the U.S. that can be directly tied to malpractice lawsuits, settlements, and payments: 1

· Percent by which medical malpractice legislation championed by the President would decrease health insurance premiums and health care expenditures: .04 -.05

· Number of hospital deaths each year that are attributable to preventable medical errors: 44,000 - 98,000

· Number of hospital injuries each year that are attributable to preventable medical errors: 300,000

· Total amount of annual medication errors that are preventable: 1.5 million

· Amount that these medication errors cost each year: $3.5

· Amount that each preventable medication error adds to the cost of the inflicted individual’s hospital stay: $8,750

· Percentage of doctors with 10 or more malpractice liability payments that received no disciplinary action from their state medical board: 67