Thoughts on Tort Reform

16 Mar Thoughts on Tort Reform

The past few weeks have seen a flurry of activity in many state legislatures on the topic of medical tort reform. State representatives and senators from Georgia to Hawaii have introduced, passed, and signed into law a variety of measures aimed directly at medical malpractice suits.
A sampling of these bills:
?In Georgia, a ?loser-pays? provision was introduced, designed to prevent frivolous lawsuits. This provision provided that if a suit were dismissed early in the case, the plaintiff ? the one who was harmed ? would have to incur the prevailing defendant’s legal costs. Georgia would be the second state to adopt this type of system.

?In Oklahoma, a provision passed the legislature to limit pain and suffering damages at $300,000, as well as require a certificate from an expert that a lawsuit has merit before it can proceed in state court, in order to prevent what the state calls ?jackpot justice.?

?In Hawaii, a bill has passed the house to limit all non-economic damages ? including pain, suffering, mental anguish, disfigurement, loss of enjoyment for life ? to $250,000 for claims against medical specialists.

?And Congressman Michael Burgess, a doctor from Texas, has reintroduced the Medical Justice Act (HR 1468), designed to regulate civil actions and limit non-economic damages in federal courts. This act mirrors the tort reforms taken in Texas back in 2003.

What does this mean for the average person? Higher costs, potentially higher taxes.

And what does this mean for the average plaintiff? Higher costs, more risk.

And what does this mean for the average doctor? Similar insurance costs. (What? Do you really think the cost of insurance will drop?)

And for the average medical malpractice attorney? A sense that justice can’t be served.

Allow me to explain:
?The average person may see a hike in taxes. This seems counterintuitive. But for the medical malpractice cases that rely on non-economic harms ? basically harms that can’t be precisely measured, such as mental anguish or pain and suffering ? there’s a strong possibility that though medical costs are covered, ?life costs? won’t be. And so what’s a person to do, but to file for social security disability benefits. The harmed person will draw about a thousand dollars each month, hoping to make ends meet. Essentially, this person ends up on the government dime, backed and paid for by the American people. How much are you willing to pay in taxes for a negligent doctor, especially if you haven’t been harmed?

?The average medical malpractice plaintiff will also see higher costs. Imagine a sense of justice where a person is harmed, consults with an attorney, the attorney takes the case (usually on contingency) ? then is forced to pay ?loser fees? when there just aren’t enough facts to fully flesh out the case. On top of this, certification to a low level state court is incomprehensible. Certification is yet another item that will be billed to the plaintiff ? regardless of whether the case wins or loses, regardless of settlements or jury awards. And though legislatures haven’t touched the calculations of economic harms ? things like the cost of medical care ? the risks of lawsuit are not properly balanced between patients and medical professionals. The capstone of the justice system is for each person to have his day in court. Yet these tort reform provisions prohibit this basic understanding of justice. Now plaintiffs are pushed toward settlement, a disturbing development which may not provide enough money for their situation and care.

?The average doctor, whether a general practitioner or specialist, will likely see similar insurance costs. To be blunt, if the insurance company is already making this amount of money from a doctor, why wouldn’t the doctor pay the same amount next year and the year after, even if the risks for huge jury awards drop? Remember: insurance companies are a for-profit business. Arguments have been made that high malpractice premiums force doctors out of state, out of country, and out of the profession. Statistics may tout the increasing number of doctors available in the state, but when compared per capita (that is, the number of doctors against the general population), there appears to be little difference between states that have enacted tort reform measures and states which haven’t. Increased numbers of doctors can be due to many other factors ? increased opportunities, increased funding, changes to the educational and medical infrastructure ? rather than a single tort reform measure.

?The average medical malpractice attorney feels the squeeze with tort reform as well. Most malpractice cases are taken on contingency ? this means the person harmed doesn’t have to pay until there is a settlement or jury award. But imagine a world were the attorney ? no matter what the total monetary award to the plaintiff is ? is taking the costs of his work out of the economic award, or the amount provided for continuing medical care. This idea is reprehensible. Additionally, plaintiffs are nearly forced into settlements, with insurance companies fully understanding the maximum a trial verdict would provide, regardless of what a jury believes. Again, reprehensible. An attorney isn’t going to file suit against anyone unless there is a case ? it would otherwise a losing proposition, especially on a contingent basis, both for the plaintiff and the attorney.

So where does tort reform get us? Higher costs, higher plaintiff risk, little to no improvement to prevent medical negligence, and a fatter wallet for the insurance companies.

Certainly something to think about.