The following is taken from
http://blog.oneillaw.com/blog/The Republicans have just introduced HR 5. (Ok, it’s been called “bipartisan’ because some guy named David Scott, a Democrat from Georgia, is a co-sponsor. Scott is a blue dog Democrat, i.e., a Republican who caucuses with the Democrats. Make no mistake, this is a GOP bill.) It styles itself as a bill “To improve patient access to health care services and provide improved medical care by reducing the excessive burden the liability system places on the health care delivery system.” This is so called malpractice tort reform.
HR 5 is virtually identical to a bill by the exact same name (HR 5) that was introduced in Congress in 2003. Anytime a bill is introduced in Congress, the Congressional Budget Office conducts a study and prepares a report on the economic effect that the bill will have if passed. The CBO has not yet prepared its estimate for the 2011 bill, but it did prepare an estimate for the 2003 bill. I’ve saved a copy of it here (
http://www.oneillaw.com/hr5ec.pdf).
The idea behind the bill is this: the cost of malpractice lawsuits (initiated by unprincipled and greedy trial lawyers, of course) is unreasonably and unnecessarily burdening the health care system, making it more expensive, and more inaccessible, for the rest of us. So, you would think, malpractice reform would lower the costs of health care, and that would benefit all of us.
How much money would malpractice reform save us? That is exactly the kind of question that the CBO report answers. In the case of the 2003 bill, the CBO estimated that the savings to the entire health care system, over a ten year period, would total $14.9 billion dollars, or an average of $1.49 billion a year.
That’s a lot of money, right? No, it’s not when you’re talking about the entire nationwide health care system. The current U.S. population is about 310 million, so that savings works out to a whopping $4.81 per person, per year, or just over a penny a day. 1.3 cents per day to be exact.
It is true that a penny saved is a penny earned, so before we scoff at this savings, we should at least take a look at what we are being asked to give up in return for this 1.3 cents per day. The signature feature of this bill is to cap damages for pain and suffering at $250,000. This of course is ridiculously inadequate, because medical malpractice can cause catastrophic injuries. Here’s a description of the injuries from a botched delivery:
“Doctors ultimately determined that Stephanie had sustained periventricular leukomalacia. As a result of that damage, she suffers spastic diplegia. She cannot control her legs, and her right arm is nearly useless. She is also wheelchair-bound, and she cannot perform most daily living tasks.”
So under HR 5, Stephanie, who will be wheelchair bound for her entire life, should only receive $250,000 (minus attorneys’ fees) in compensation from the doctor whose negligence is responsible for this condition? So that we can all save 1.3 cents per day? No thanks, I’m not interested.
Actually, the joke that the GOP seeks to play on us is even more cruel. That 1.3 cents savings does not go into your pocket. It’s a “trickle down” savings. Here’s how it works: the medical malpractice insurer saves the money, because instead of paying Stephanie several million dollars in damages for her horrendous injuries, it only has to pay $250,000. In theory, the insurer then reduces its insurance rates, and in theory the doctors and hospitals reduce their charges because they are paying less for malpractice insurance, and in theory the health insurance companies pay less for medical care because the doctors and hospitals have reduced their rates, and in theory the medical insurance companies lower their premiums because they are paying less to the doctors and hospitals, and in theory your employer pays less for medical insurance because the health insurer has reduced its premiums, and in theory your employer gives you a raise because it is paying less for your medical insurance.
And if you believe that the 1.3 cents is ever going to trickle down to your pocket, I know of a bridge that you can buy with that savings.
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