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Bill Bradley's Airball on Health Care Compromise

August 31, 2009

In a New York Times op-ed Sunday, former New Jersey Senator and legendary New York Knicks forward Bill Bradley looked back to the future of health care reform. Citing his own role in the deal with Ronald Reagan that produced the 1986 overhaul of the tax code, Bradley optimistically insisted, "a grand bipartisan compromise is still possible with health care." But in declaring, "The bipartisan trade-off in a viable health care bill is obvious: Combine universal coverage with malpractice tort reform in health care," Bill Bradley sadly shot an airball. The Republican team will simply never do that deal and the impact of tort reform on skyrocketing medical costs would be minimal even if they did.
The political landscape for health care reform in 2009 resembles the 1986 tax debate in much the same way that bricks float. The GOP today as in 1993 is not merely committed to preventing the enduring Democratic majority that would follow success on health care. In the intervening years, obstructionist Republicans in Congress have repeatedly proven themselves the proverbial immovable object, delivering no votes for the Clinton economic package in '93 and only three for the Obama stimulus package.
Undeterred, Senator Bradley offers the prospect of a deal for the ages by dangling the carrot of tort reform to Republicans more concerned about bashing Democratic-leaning trial lawyers than lowering the cost of health care:

Since the days of Harry Truman, Democrats have wanted universal health coverage, believing that if other industrialized countries can achieve it, surely the United States can. For Democrats, universal coverage speaks to America's sense of decency and compassion. Democrats also believe that it will lead to a healthier and more productive country.
Since the days of Ronald Reagan, Republicans have wanted legal reform, believing that our economic competitiveness is being shackled by the billions we spend annually on tort costs; an estimated 10 cents of every health care dollar paid by individuals and companies goes for litigation and defensive medicine. For Republicans, tort reform and its health care analogue, malpractice reform, speak to the goal of stronger economic growth and lower costs...
Universal coverage can be obtained in many ways -- including the so-called public option. Malpractice tort reform can be something as commonsensical as the establishment of medical courts -- similar to bankruptcy or admiralty courts -- with special judges to make determinations in cases brought by parties claiming injury. Such a bipartisan outcome would lower health care costs, reduce errors (doctors and nurses often don't report errors for fear of being sued) and guarantee all Americans adequate health care.

Unfortunately, the former basketball star didn't read the scouting report on the other team. Just as important, Bradley skimmed over the sizable literature showing that the Republicans' favorite bogeyman - malpractice litigation - has only a negligible impact on overall health care costs.
The merits or demerits of Bradley's proposal notwithstanding (one President Obama has suggested he might support), the data just doesn't bear him out.
Numerous studies have consistently shown that increasing damage awards from malpractice explain only a small portion of the rapid rise in health care costs. A January 2004 study by the Congressional Budget Office (CBO) found from 1986 to 2002, malpractice insurance premiums jumped 15% per year, while the average damage award rose only 8% ($95,000 to $320,000). The jump in malpractice premiums has been almost double the rate of increase in health care costs per person, and roughly four times the rate of inflation. The CBO report also points out that "although the cost per successful claim has increased, the rate of such claims has remained relatively constant. Each year, about 15 malpractice claims are filed for every 100 physicians, and about 30 percent of those claims result in an insurance payment." As the CBO concludes, GAO data shows that about half of the increase in doctors' malpractice premiums is due to the drop in annual investment returns by the top 15 insurers. Recent low profit rates and market consolidation among insurers is creating additional upwards price pressure.
The myth of rapacious trial lawyers and their greedy clients filing baseless malpractice claims was also shattered by May 2006 study from the Harvard School of Public Health. The report, which appeared in the New England Journal of Medicine, exhaustively examined 1452 medical malpractice cases "to determine whether a medical injury had occurred and, if so, whether it was due to medical error." In a nutshell, the study found that by and large the American system of medical personal injury compensation works, with valid claims receiving compensation and frivolous ones not:

Most of the claims that were not associated with errors (370 of 515 [72 percent]) or injuries (31 of 37 [84 percent]) did not result in compensation; most that involved injuries due to error did (653 of 889 [73 percent]). Payment of claims not involving errors occurred less frequently than did the converse form of inaccuracy - nonpayment of claims associated with errors.

If anything, the data show that the United States may have too few malpractice legal actions, rather than too many. In 2003, the Institute of Medicine of the National Academies issued a devastating report detailing the scope and gravity of the safety of the U.S. health care system. Two studies showed that "at least 44,000 people, and perhaps as many as 98,000 people, die in hospitals each year as a result of medical errors that could have been prevented."
In 2005, Tom Baker, director of the Insurance Law Center at the University of Connecticut School of Law, produced a powerful rebuttal to the Republican scare campaign in The Medical Malpractice Myth. His analysis supports the CBO's conclusion that insurance underwriting cycles, and not more malpractice lawsuits or larger damage awards, are largely responsible for the increase in physicians' insurance premiums. Similarly, malpractice lawsuit account for only a small fraction of the increase in health care costs. Baker provides extensive data to show that only a small fraction of medical errors and injuries result in malpractice litigation. And contrary to another aspect of malpractice mythology, juries generally favor doctors in malpractice outcomes, not the injured plaintiffs. Baker's analysis also suggests that President Bush's assertion that "lawsuits don't heal patients" notwithstanding, they no doubt prevented countless other deaths and injuries. And only in certain geographic areas and medical specialties is there some truth to President Bush's famously garbled claim that malpractice suits are driving physicians out of the business:

"Too many OB/GYNs aren't able to practice their love with women all across this country."

Nevertheless, President Bush continued to push his baseless claim that capping damage awards for "pain and suffering" and other non-economic at $250,000 would produce a windfall for the American health care system. Both the GAO and CBO rejected that assertion, with the CBO finding "no evidence that restrictions on tort liability reduce medical spending" and concluding:

"In short, the evidence available to date does not make a strong case that restricting malpractice liability would have a significant effect, either positive or negative, on economic efficiency."

In 2006, the Congressional Budget Office examined the links between tort limits and health care spending, with results it deemed "inconsistent" and "mixed." That followed CBO's findings two years earlier which documented the minimal impact that increases in medical malpractice insurance premiums have on overall health care costs. As Media Matters noted:

A 2004 CBO report concluded that capping awards at $250,000 for non-economic damages in medical malpractice lawsuits "would basically save only 0.4 percent of the amount that's spent now" on health care. According to the report, "[M]alpractice costs amounted to an estimated $24 billion in 2002, but that figure represents less than 2 percent of overall health care spending. Thus, even a reduction of 25 percent to 30 percent in malpractice costs would lower health care costs by only about 0.4 percent to 0.5 percent, and the likely effect on health insurance premiums would be comparably small."

Bill Bradley was a great Senator, one I proudly supported during his days representing New Jersey and again during his 2000 presidential run. But in the game of health care reform, the numbers aren't on his side. As for the GOP, for all of Bradley's good will, the Republican will just take their ball and go home.

3 comments on “Bill Bradley's Airball on Health Care Compromise”

  1. Texas did tort reform and malpractice insurance did not go down. The insurances companies have saved billions, because it is now virtually impossible, for numerous reasons, for a private citizen to bring a suit for damages and the damage limit is usually not enough to pay for any serious harm done by a physician.
    Forget about paying an attorney and court costs, very few can afford to sue for malpractice and lawyers don't get enough of any settlement to justify their time.
    Insurance won big time.
    Doctors came out with a tie.
    Patients get screwed by doctors and insurance companies big time.
    Oh, and guess who was governor??

  2. Democrats control the White House, 60 seats in the Senate and 60% of the House. They were elected for some damn reason. They need to figure out what they want to do and do it. It's long past time to leave the Republicans and their screaming birthers, deathers and other assorted nuts behind and get something done.


Jon Perr
Jon Perr is a technology marketing consultant and product strategist who writes about American politics and public policy.

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