Moving Toward Medical Liability Reform

Valerie Manak contributed to this post.

Recently, key policymakers are signaling a renewed commitment to address medical liability reform. In his 2011 State of the Union address, President Obama called for medical malpractice reform and an end to “frivolous” spending. House Republicans began holding hearings on the issue at the start of this legislative session. Despite this recent interest and many years of debate and lobbying on this issue, movement on major medical malpractice reform is slow.

Like so many issues in our medical delivery system, there is a new urgency to overhaul our system of adjudicating disputes about alleged medical errors. According to a 2010 Health Affairs study, defensive medicine — the practice of providing medical procedures, tests, and consults to avoid potential lawsuits – costs over $45 billion annually. CBO declared that malpractice liability reform could reduce the federal deficit by $54 billion over the next decade. As we have learned through the broader health reform debate, health care spending accounts for approximately one-fifth of the federal budget. Given the federal and state budgetary crises, it is an unaffordable luxury to spend billions on services that do little or nothing to improve health.

The Bipartisan Policy Center is watching the latest movement on medical malpractice reform with much interest. President Obama recently agreed to meet with the 21-member House Doctors Caucus, a group of Republican House doctors and nurses to discuss, among other things, medical malpractice reform. Indeed, several organizations are fundraising for their advocacy campaigns and otherwise gearing up to join the anticipated medical malpractice liability reform debate in the near future.

While this latest movement is promising, it feels very déjà vu. Any new discussion of medical malpractice reform must squarely address the issues that stop this discussion in its tracks every time:

1. how to fairly compensate the injured (to cap or not to cap damage awards);
2. state control over medical licensure and insurance laws v. federal authority to preempt state law (federalism questions);
3. the best procedure for adjudicating disputes (jury or no jury, specialized courts); and
4. the standard of liability (e.g., negligence, avoidability, etc.).

Changes at the federal level would preempt existing medical malpractice laws in some states and may raise opposition on constitutional grounds. Yet, medical malpractice reforms at the state level vary widely, as do medical malpractice costs.

The Bipartisan Policy Center is monitoring the many different medical liability initiatives underway to better understand a possible solution to this ongoing challenge. Several states and private organizations are exploring a number of different strategies — such as cultural changes, enhanced disclosure, early compensation, caps on damages, qualification standards for expert witnesses, and health courts. Some approaches are highlighted here:

Cultural Changes at Ascension Health

Under a grant from the Patient Safety and Medical Liability Initiative administered by HHS, Ascension Health is working the issue on the provider side by reducing opportunities for lawsuits. Ascension’s goal is to reduce malpractice insurance in obstetrics because malpractice insurance for this specialty can be so high it creates a shortage of obstetricians in some areas. Ascension’s cultural and procedural changes include efforts to promote enhanced teamwork, greater awareness of potential errors, and an unrestricted ability to solicit expertise when needed.

Procedural Changes

The University of Texas Health Science Center is currently testing a system where medical professionals disclose errors to patients and compensate them promptly for their injuries. The goal is to apply a disclosure policy to identify best practices in patient safety for dissemination.

Health Courts

Another proposal is to establish health courts, which are a type of jury-less administrative court that only resolves medical malpractice cases. Health courts, proponents argue, would help curb defensive medicine. Rulings by judges with expertise in the medical field would help establish care standards for medical professionals and patients, enabling everyone to operate in a predictable environment.

Stay tuned for more developments in this area.