Bush Revisits Medical Malpractice Tort Reform

According to White House documents, malpractice reform can reduce federal government costs by at least $28 billion per year, freeing up needed funds that can make health care more affordable.

The president's call for liability reform drew a sharp rebuke from four Democratic senators, who said in a letter to the White House that the administration's proposals would deprive seriously injured patients of fair compensation.

Moreover, they said, the White House reforms would do nothing to guarantee that doctors could obtain malpractice insurance at a fair price.

The letter was signed by Sens. Edward Kennedy, D-Mass., Patrick Leahy, D-Ver., Richard Durbin, D-Ill., and John Edwards, D-N.C.

The White House said that over the last few years, doctors, nurses and hospitals have faced skyrocketing medical liability insurance premiums because of the nation's broken litigation system.

"These greatly increased costs are threatening access to health care," the White House said.

"And the environment has caused doctors who fear getting sued to practice defensive medicine, prescribing costly medical treatments for the sole purpose of avoiding litigation, raising costs and putting patients at risk," the White House said.

The White House added that doctors are retiring early, reducing their practices to patients who present less risk of litigation or moving to states that reform their medical litigation systems.

In addition to capping non-economic damages at $250,000, President Bush is calling for "reasonable" limits on punitive damages and elimination of joint and several liability (meaning that defendants would only be responsible for their portion of any harm).

The president also wants awards against doctors reduced by any amount received by patients from an insurance company as compensation for a loss.

The four senators, however, charged that the administration's plan would shield HMOs that fail to provide needed care.

They particularly criticized the proposed cap on non-economic damages, which they said would arbitrarily limit the compensation which the most seriously injured patients can receive.

"These are men, women and children whose lives have been permanently altered by the misconduct of medical providers," the senators said.

They said the main cause of the current malpractice crisis is the insurance industry, which creates a "malpractice crisis" whenever its investments do poorly.

"The dramatic decline in the markets during the past two years is the reason for the sudden, sharp increase in medical malpractice insurance premiums," they said.

"What we are witnessing is not new," the senators added.

They called for tougher regulation of insurance companies.

"When insurance companies lose money on their investments, they should not be able to recover those losses from the doctors they insure," the senators said.