The latest drive for long-sought medical liability reform legislation got off to a roaring start last week with praise from the president before slamming into a wall of objections from the most powerful healthcare official in the federal government.
Sides lining up over latest liability reform push
Kathleen Sebelius, HHS secretary, indicated last week that the Obama administration is likely to oppose the Republican medical malpractice legislation introduced Jan. 25.
That malpractice reform bill was sponsored by Dr. Phil Gingrey (R-Ga.) and unveiled with wide Republican support. The bill was based on a tort reform law enacted in California during the 1970s and would cap non-economic damages at $250,000.
Gingrey said the legislation aimed to improve the affordability of medical malpractice insurance, eliminate a financial albatross for clinicians, reduce healthcare costs for patients, and save “billions of dollars a year” by reducing the need for so-called defensive medicine. “It is an effective way to stop wasteful spending within our healthcare system, while ensuring better outcomes for patients,” Gingrey said when introducing the bill.
Tort reform is a longstanding objective of Republicans, who repeatedly urged the inclusion of such a measure as a way to control healthcare costs as part of last year's healthcare measure.
The malpractice bill also drew the support of physicians and hospital advocates. Richard Pollack, executive vice president of the American Hospital Association, wrote Gingrey on Jan. 26 that the measure was needed because the proliferation of malpractice lawsuits “threatens the stability of the hospital field.”
The American Medical Association and 10 other physician and medical organizations praised the bill in a letter to lawmakers for provisions that would promote speedier resolutions to disputes and maintaining access to courts, while limiting non-economic damages to a quarter million dollars.
Dr. Ardis Hoven, chair of the AMA's board of trustees, told lawmakers during a Jan. 20 House Judiciary Committee hearing that the current legal environment has created a “culture of fear” that leads to defensive medicine practices adding between $70 billion and $126 billion to the nation's annual health bill.
The bill's Republican and provider support was further bolstered by President Barack Obama specifically encouraging such a change to the nation's healthcare laws during his State of the Union address. Obama said he was “willing to look at other ideas to bring down (healthcare) costs, including one that Republicans suggested last year: medical malpractice reform to rein in frivolous lawsuits.”
But after her first congressional testimony on the healthcare law, Sebelius told reporters that, although the administration has not yet taken an official position on it, Gingrey's approach to medical malpractice reform did not mesh with Obama's ideas on it.
“It has some of the provisions that the president said he would clearly not support at the end of the day,” Sebelius said about the bill's creation of caps on punitive damage awards and its “state-based framework.”
Sebelius' assessment of the bipartisan legislation may disappoint physicians and other advocates of national limits on malpractice lawsuits. They had expressed optimism that Congress would finally enact such legislation after decades of fruitless efforts.
Senate Democrats are likely the key to eventual passage of any tort reform bill. And although liberal Democrats spoke out strongly against such a measure this week, moderate Democrats have indicated tort reform should be among the healthcare cost-control “fixes” to the healthcare law considered by Congress.
Joe Manchin III (D-W.Va.), until recently governor of West Virginia, said a medical malpractice measure enacted in his state is what “keeps the doctors from leaving West Virginia.” However, even Manchin would not to describe such a measure as a priority, instead calling it “one part of a whole healthcare mix.”
Mark Warner (D-Va.) agreed that cost-control proposals are needed to reduce government spending in all areas but tort reform “is not a silver bullet.” And Max Baucus (D-Mont.) said merely that it “should be on the table, like everything else.”
Outside Washington, there was general support for the measure that includes a clause noting the bill should not “be construed to preempt any state law” specifying compensatory or punitive damages or healthcare provider protection.
In Baucus' home state of Montana, noneconomic damages are already capped at $250,000, but Kristianne Wilson, executive director of health policy at the Billings Clinic, said there is support and a need for a federal statute—and this sentiment has been passed along to Baucus. “We would encourage him to give this serious support,” she said. “Montana has done a good job, but we are facing premium increases.”
Wilson also noted that liability premiums and the defensive medicine practices that go with it are just part of “one dimension of what is driving costs up,” and that delivery system and payment reforms will have more impact on lowering costs in the long run. And she added that, along with caps, Billings Clinic has discussed with Baucus other ways to address liability reform, such as medical malpractice courts.
Others are likewise thinking beyond caps and hope any federal attempt to address the issue will take a nuanced approach.
At the University of Illinois at Chicago, for example, a grant of almost $3 million will be used to study how a focus on patient safety coupled with transparency on errors and early offers of compensation effects litigation. “I think it fits nicely into where the administration is trying to go by attacking how expensive healthcare is on many fronts,” said Dr. Timothy McDonald, who is leading the study.
UIC, a self-insured institution, has instituted a policy of being transparent on medical errors, which McDonald said helps uncover why they occurred in the first place and prevent similar ones. “We have been able to settle cases quickly and efficiency when we recognize when our care was inappropriate—when you look at our cases, zero dollars have been spent on expert witnesses,” he said. “We recognize that deny and defend has not worked and will not work to help us get safer.”
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