NU Online News Service, Dec. 1, 3:46 p.m.EST

WASHINGTON–The co-chairmen of the deficit commissionappointed by President Obama today proposed "aggressive tortreform" as one of its recommendations for reducing the federalbudget deficit.

The co-chairmen of the 18-member National Commission on FiscalResponsibility and Reform also said in their draft, "Many membersof the commission also believe that we should impose statutory capson punitive and non-economic damages, and we recommend thatCongress consider this approach and evaluate its impact."

Representatives of the plaintiffs' lawyer industry immediatelyassailed the recommendations, calling them "dangerous proposals[that] will create a health care system that costs more butproduces worse outcomes."

Also among the deficit-cutting proposals contained in thecommission's draft report was a recommendation for the creation ofa disaster fund that would "budget honestly for catastrophes."

Blaine Rethmeier, a spokesman for the American InsuranceAssociation, said the deficit panel's recommendations shouldreceive prompt consideration.

"The good news is that the recommendations contained in thereport are already bringing focus to the issues," Mr. Rethmeiersaid.

He added, "We have an enormous budgetary problem facing ourcountry and our future generations. Congress needs to give each ofthe commission's recommendations serious consideration in order toimprove our nation's fiscal health."

The changes were proposed in the draft of the "Moment of Truth"proposal on federal budget-cutting unveiled by Democrat ErskineBowles and Republican Alan Simpson.

A vote on the proposal by the full committee membership isscheduled for Friday. The co-chairmen released their proposal thismorning.

On tort reform, the co-chairmen recommended that among thepolicies that should be pursued, state and federal governmentsshould consider modifying the "collateral source" rule to allowoutside sources of income collected as a result of an injury (forexample, workers' compensation benefits or insurance benefits) tobe considered in deciding awards.

The co-chairmen also suggested imposing a statute oflimitations–perhaps one to three years–on medical malpracticelawsuits and replacing joint-and-several liability with afair-share rule, under which a defendant in a lawsuit would beliable only for the percentage of the final award that was equal tohis or her share of responsibility for the injury.

The co-chairmen further suggested creating specialized "healthcourts" for medical malpractice lawsuits and allowing "safe haven"rules for providers who follow best practices of care.

They projected that those changes would save $2 billion in 2015and $17 billion through 2020.

But Gibson Vance, president of the American Association forJustice, which represents trial lawyers, said, "Not once does thisreport mention patient safety and solving the epidemic of medicalerrors that plague our health care system, costing thousands oflives and billions of dollars each year."

He added, "These radical ideas will guarantee that patientsinjured by medical errors are left with no recourse, leavingtaxpayers to foot the bill and causing our nation's deficit to risefurther.

"The last thing Americans want is Washington interfering evenmore with their health care by creating expensive new health courtsor controversial practice guidelines that will tie the hands ofphysicians and create even more government bureaucracy."

On disaster relief, the co-chairmen suggested a disaster fundbudget authority be limited to the rolling average of disasterspending in the most recent 10 years, excluding the highest andlowest year.

Any unused budget authority would be rolled forward to increasethe disaster fund budget available in the following year, theysuggested.

Any spending above the disaster fund limit must be offset byreductions in spending or subject to a 60-vote point of order (andall other requirements established for regular emergencyspending).

Moreover, the two co-chairmen recommended codifying a strictdefinition of what qualifies as a disaster and requiring Congressand the president to separately designate spending as an emergencyand as necessary for the purposes of disaster response.

"To keep Congress accountable and encourage transparency, thecommission also recommends the establishment of a searchable onlinedatabase of all disaster spending, similar to that found on theRecovery.gov website, to be maintained by the GovernmentAccountability Office and operational by January 1, 2012," theco-chairmen proposed.