Medical Device Daily Washington Editor
WASHINGTON — President George Bush set out last week to spend some of the “political capital“ that he said he had gained with his second-term election by launching a push for caps on medical malpractice awards.
At an event in Collinsville, Illinois, the president told supporters that medical liability reform would lead to lower overall healthcare costs. Characterizing the liability system as “out of control,“ he called on Congress to act, saying that many of the rising costs for healthcare start in the courtroom rather than the examining room.
“The U.S. Congress needs to pass real medical liability reform this year,“ Bush said. “And because the system is so unpredictable, there is a constant risk of being hit by a massive jury award. Doctors end up paying tens of thousands, or even hundreds of thousands of dollars, to settle claims out of court, even when they know they have done nothing wrong.“
Bush acknowledged that medical research requires major investments and that “world-class medical technology is expensive.“ But he said “junk lawsuits“ were changing the way that doctors are practicing medicine.
If physicians weren't so busy trying to avoid malpractice suits, he said, they could provide correct and better care. He argued that too often doctors are writing prescriptions and ordering tests that aren't needed in order to reduce the potential for such lawsuits.
“[S]ome costs are not necessary,“ Bush said, “and that's what the American people must understand, and members of the Senate and the House must understand.“
The Bush plan would put a limit of $250,000 on non-economic damages, which also means the pain and suffering portions of malpractice awards. There would be no imposed limits on economic losses suffered as the result of “legitimate medical error,“ the president said.
“I believe a victim of a legitimate medical error should be allowed to collect full economic damages, 100% of the cost of their medical care and recovery, plus economic losses for the rest of their life,“ he said. “And, when appropriate, injured people should be allowed to collect reasonable non-economic damages. And in the case of truly egregious wrongdoing, patients should be entitled to punitive damages.“
The president's proposal would allow malpractice awards to be paid out over time, instead of in a lump sum, in addition to limiting the time in which such suits could be filed after malpractice is claimed.
Opponents of the president's plan maintain that caps on malpractice claims serve only to shield doctors and companies that provide substandard healthcare or products. The real problem, according to lawyers who represent malpractice victims, is insurers who look to raise premiums, which affects the healthcare spending for individuals and companies.
Sen. Edward Kennedy (D-Massachusetts), ranking member of the Senate Health, Education, Labor and Pensions Committee, characterized the president's plan as a “shameful shield“ for drug companies and health management organizations (HMOs) and would further divide the country rather than fulfilling the president's promise to unify and heal after a bitter election.
“Whether it's big corporations or members of congress, it's wrong to have one set of rules for those in power and another for everyone else,“ Kennedy said. “When drug companies or HMOs hurt people, they should be held to account, just like everyone else.“
The president knows how to “reach across the aisle and build consensus when he wants to,“ Kennedy said, adding that now was the time. “If he is serious about responsible reform, then I urge him to put forth a proposal that puts patients first and stop blocking the bipartisan Patients' Bill of Rights,“ Kennedy added.
On the device side, the reform is probably good for industry, a spokesperson for the Advanced Medical Technology Association (AdvaMed; Washington), told Medical Device Daily.
“The environment of legal uncertainty has a chilling effect on innovation, which in the long run is not good for patient care and the healthcare system,“ the spokesperson said. “The breakthrough products have the greater risk and the greater vulnerability to potential liability.“
According to a survey of AdvaMed members conducted by the association about two years ago, a quarter of those polled said that potential liability concerns directly impact whether they initiate certain projects and research. Of the respondents, 8% said they had abandoned a project in early design stages due to the fear of litigation.
“If you've met and followed FDA requirements and received their approval, you should not be held liable for a standard that is really only meant to apply to flagrant indifference toward public health,“ the AdvaMed spokesperson added.
Bush said frivolous litigation has raised the total cost of the tort system in the U.S. to more than $230 billion a year, though he did not identify the source of that figure.
According to a Congressional Budget Office report issued last year, malpractice costs represented less than 2% of overall healthcare spending in 2002, and even a reduction of malpractice costs around 25% would only lower healthcare costs by roughly 0.4%.
“The likely effect on health insurance premiums would be comparably small,“ the report said.
On Thursday, a group called the Coalition to Preserve Access to Justice (Washington) held a press conference and issued a statement accusing the administration “of assaulting consumer access to the courts and limiting consumer protection“ with the proposed cap on liability claims.
“The president, promoting limits on consumer lawsuits but not business lawsuits, essentially blames consumers for hindering the nation's economic growth,“ the group said, pointing specifically to the pharmaceutical industry and the recent revelations of harmful side effects produced by the drugs Vioxx and Celebrex.
“It's ridiculous to say consumer lawsuits are to blame for the [country's] economic mess when there's evidence that so many worthy cases can't even get to trial. The president keeps talking about lawsuit abuse, but consumers and workers are the ones being abused,“ said Sally Greenberg of Consumers Union (Washington/New York), one of the members of the coalition — and an aggressive proponent of mandatory publication of drug study results.