In the past few years, federal tort reform, i.e. H.R. 5, has been paraded through the media ad nauseam. As with anything in politics, there’s been constant debate amongst political parties, the media, and interest groups, thus making it difficult to not only understand H.R. 5, but comprehend how it will affect us and our rights.
What we do know is that it will affect medical malpractice litigation on a national scale; this is the field tort reform was designed to change, but whether it will change it in the ways purported is unknown. Luckily, various states have already implemented some form of tort reform, the results of which indicate how H.R. 5 will affect citizens.
In states with tort caps, medical malpractice claims have decreased, but a Harvard study found that 97% of medical malpractice cases do involve injury which indicates that valid cases are not reaching the court system. Meanwhile, physicians have not seen the decreases in liability insurance costs, nor citizens in health care costs, that many experts predicted. Yet, medical malpractice insurance companies seem to be doing just fine. The American Association for Justice (AAJ) reports that the top 10 insurers in the medical malpractice field are realizing profits well beyond those seen by the top 50 most profitable Fortune 500 companies.
States like California, which implemented caps through its Medical Injury Compensation Reform Act (MICRA), are proof that tort reform does not contribute to a more affordable health care system. “MICRA’s caps on pain and suffering damages have not reduced insurance rates for doctors in my state,” California U.S. Representative Linda Sanchez said. “MICRA was signed into law in 1975, but stability in medical malpractice insurance rates did not occur after MICRA was passed. Between 1975 and 1993, in fact, health care costs in California rose 343%, nearly twice the rate of inflation. Not only that, but the California costs exceeded the national average each year during that period by an average of 9% per year.”
Moreover, H.R. 5 will make it difficult for medical malpractice victims to receive compensation for their injuries, as is evidenced by states with implemented tort reform. In placing damage caps on punitive and noneconomic damages, as well as reducing lawyers’ contingency fees, lawyers’ financial incentive to take medical malpractice cases is eliminated. This was seen in Texas when it implemented H.B. 4 in 2003. The bill placed a $250,000 cap on noneconomic damage awards in medical malpractice cases. Ultimately, the highest a Texas medical malpractice victim may receive in noneconomic damages is $750,000, and such a rare instance would involve a case brought against multiple health care providers, institutions, and physicians. However, if a victim dies as the result of medical malpractice, a “wrongful death” suit claimant can only receive $500,000 total in damages. H.B. 4 effectively placed a price on human life.
The effects of H.B. 4 on the Texas medical malpractice industry were enormous. Pauline Rosenau, Ph.D. and professor at the University of Texas School of Public Health, comments, “Professor Charles Silver at the University of Texas law school has published one study [that relates] to the effects of the Texas cap on medical malpractice on the health system. This research team did report a reduction in the number of malpractice claims after the cap was implemented.”
However, this reduction wasn’t necessarily a good thing for Texas citizens. As a result, many lawyers have either stopped taking medical malpractice cases altogether or begun choosing their cases wisely, often turning down cases where injury is apparent because the little money they could make is simply not worth their time. Stories of injured patients unable to seek justice for their injuries aren’t unheard of in the state. Take the cases of Charles Caldwell and Danny Lara. Caldwell died in 2008 after attendants in his Dallas nursing home physically forced him to consume medication, which fatally entered his lungs. After this event, Caldwell’s son attempted to sue for medical malpractice but found no one to help him seek justice for his father’s death; no attorney would take his wrongful death case because it could only result in $500,000 in damages recovery at most. It wasn’t that Caldwell’s case wasn’t valid; according to the Houston Chronicle, the caps on damages in Texas are so low that no attorney could afford to undertake such a case. The Boston Globe reports that a similar story is shared by Lara; he has yet to find a lawyer for his father’s 2005 death in Texas, which he argues was the result of a doctor’s error, because “the lawyers say there’s no money in it anymore.”
Why Is This Bill Even Being Considered?
Given the proven negative effects of damage caps on medical malpractice cases, the obvious question is, “Why is this bill even being considered?” The answer is simple: politics begets politics. As previously mentioned, Congressman John “Phil” Gingrey is the sponsor of H.R. 5. And, as everyone knows, when politicians run for office they raise campaign funds. The majority of Gingrey’s campaign funds come from companies and individuals with interests in the health care and insurance industries. According to MapLight.org, between 2009 and 2011, Gingrey received more than $551,000 in “contributions” from health professionals, pharmaceuticals/health products, insurance, lobbyists, and hospitals/nursing homes interest groups. He received another $44,500 from Aflac, Ob-Gyn Pac, Abbot Laboratories, the American College of Cardiology, and the American Academy of Orthopedic Surgeons, the latter four of which are all either physician groups or conduct health care-related research.
Worth noting is that the majority of the physician groups contributing to Gingrey are those whose professions primarily involve surgery and other risky medical procedures. And those contributors listed above are only some of Gingrey’s financial supporters; many other organizations related to the health care and insurance industries have contributed to Gingrey as well. OpenSecrets.org reports that between 2011 and 2012, Gingrey received $428,975
from health professionals, pharmaceuticals/health products, lobbyists, health services/HMOs, hospitals/nursing homes, and insurance industries alone. Meanwhile, this is only Gingrey’s contributors; he’s rallied 134 cosponsors to support the bill, many of whom it is safe to assume have campaign contributors similar to Gingrey.
“Tort reform has nothing to do with filling a need or dealing with a truly federal issue,” personal injury attorney Thomas Simeone said. “Instead, it has to do with the right wing attempting to obtain financial gain for two of its biggest constituents – doctors and insurers – and hurt one of its biggest opponents – trial lawyers. In doing so, its proponents violate their own beliefs [against federal government involvement in issues that the states can and have dealt with] and mistreat the innocent injured patients.” Both Simeone and consumer protection lawyer James Pizzirusso contend that H.R. 5 is an insult to federalism and is fundamentally unconstitutional.
“Medical malpractice is a states’ rights issue and we should let the states devise their own rules governing these claims,” Pizzirusso said.
As it stands, H.R. 5′s future is fully dependent on whether it is approved by the Democrat-controlled Senate and President Obama, who is likely to veto the bill.
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