Malpractice Claims Down, Health Care Costs Up

Health care reform captured the nation’s headlines these past few days. And, predictably, politicians and editorial writers claim that “tort reform” must be part of the health reform package.

However, a major new study has been released that debunks the myth that medical costs are out of control because of irresponsible lawsuits and jury awards.

The report, by Americans for Insurance Reform (AIR), is titled “True Risk: Medical Liability, Malpractice Insurance and Health Care.” One of the authors is actuary J. Robert Hunter, who is Director of Insurance of the Consumer Federation of America (CFA), former Commissioner of Insurance for the State of Texas, and former Federal Insurance Administrator under Presidents Carter and Ford. Robert Hunter writes,

“If Congress completely eliminated every single medical malpractice lawsuit…overall health care costs would hardly change, but the costs of medical error and hospital induced injury would remain and someone else would have to pay.”

Health care reform, insurance costs, and the right to sue for damages in court are all especially critical issues to people suffering from asbestos-related diseases, such as mesothelioma. Whether one is injured by physician malpractice or an unsafe workplace, citizens need to be told the truth about “tort reform” before they give away more of their legal rights to sue for damages.

Key findings of the report:

• Medical malpractice claims, inflation-adjusted, are dropping significantly, down 45 percent since 2000. Yet there has been no corresponding drop in health-care costs, which ought to tell us that something beside malpractice litigation is driving health care costs.
• Medical malpractice premiums, inflation-adjusted, are nearly the lowest they have been in over 30 years.
• Medical malpractice premiums are less than one-half of one percent of the country’s overall health care costs.
• Medical malpractice claims are a mere one-fifth of one percent of health care costs and at no time in more than 30 years have premiums and claims have never been greater than 1% of our nation’s health care costs.
• Medical malpractice insurer profits are higher than the rest of the property casualty industry, which has been remarkably profitable over the last five years.
• The periodic premium spikes that doctors experience, as they did from 2002 until 2005, are not related to claims but to drops in investment income.

In state after state that passed “tort reform” laws, patients have lost significant legal rights and many unsafe health care providers are now unaccountable. But none of the promised benefits of “tort reform” — lowered health care costs and more physicians, for example — have materialized.

See more about the report at The Pop Tort, a blog for the Center for Justice & Democracy.

— Barbara O’Brien

This entry was posted on Wednesday, July 29th, 2009 at 11:13 am and is filed under Uncategorized. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.