Senate Sets Stage For Med Mal Reform

Washington

The U.S. Senate Finance Committee this week could add specific provisions curbing the cost of medical malpractice lawsuits when it acts on broader health reform legislation this week.

The stage was set for such action through inclusion of a placeholder provision dealing with medical malpractice in "America's Healthy Future Act," the legislation introduced last week by Sen. Max Baucus, D-Mont., chair of the Senate panel.

The provision in the bill introduced by Sen. Baucus would "express the Sense of the Senate" that health care reform presents an opportunity to address issues related to medical malpractice and medical liability insurance.

However, the chief executive officer of a medical malpractice insurer in New York cautioned that federal legislation is not the whole answer to reducing the cost of health care unless such tort reforms are comprehensive in nature.

Anthony J. Bonomo, CEO of Physicians' Reciprocal Insurers in Roslyn, N.Y., the state's second-largest medical malpractice carrier, cautioned that comprehensive reforms are required to make a significant difference on health care costs.

He said that federal legislation merely capping pain and suffering awards, for example, will not necessarily discourage doctors from practicing defensive medicine by ordering unnecessary tests and thus driving up costs merely to protect themselves from potential lawsuits.

"Caps might be a component of reforms, but they are not the total answer," he said. "Remember that caps only affect cases that are tried to conclusion. The majority of cases are settled before even going to court, so a cap would not have any definable impact."

At the same time, he said, one positive aspect of a cap is that they "would help make pain and suffering awards less arbitrary."

Still, Mr. Bonomo said the "thrust of medical malpractice reforms should be to make sure anyone injured can be compensated fairly, and at the same time ensure that doctors are not overpaying."

He argues that the industry's lobbying focus needs to be at the state level, and it must go beyond pain and suffering.

"We need to look at it from a holistic point of view because there are other changes that come before pain and suffering, which can have a greater impact in stabilizing the system and reducing costs," Mr. Bonomo said.

That such a provision could be inserted in health reform legislation was anticipated by the American Association for Justice, formerly the Association of Trial Lawyers of America, according to an industry lawyer who defends insurers against lawsuits.

The AAJ's third-quarter lobbying report shows a major shift of resources to oppose federal medical malpractice legislation, the lawyer said.

Meanwhile, in advance of President Barack Obama's Sept. 9 speech to Congress, the AAJ mounted a public relations campaign to "dispel the myth" that the fear of malpractice lawsuits accounts for astronomical health care costs.