Limiting the Cost of Medical Malpractice

A September 2010 study by researchers at Harvard University found that the cost of Medical Malpractice in the US was $55.6 Billion Dollars, or 2.4% of Healthcare Spending. They looked at a variety of factors such as money paid to Plaintiffs, legal expenses, administrative expenses, and the cost of defensive medicine. While there may be disagreement regarding how Harvard reached this number, there is little disagreement that this cost exists.

Georgia’s own US Representative Phil Gingrey has set out to address this problem in Bill H.R. 5. The HEALTH (Help Efficient, Accessible, Low Cost, Timely Healthcare) Act of 2011 aims to reduce the burden that the current liability system places on the healthcare delivery system. This bill was considered in committee and has been recommended for consideration by the entire House. Many of the provisions of this bill aim to reduce the cost of Medical Malpractice.

For instance, the bill limits non-economic damages to $250,000.00. This is no doubt in response to recent large jury verdicts for non-economic damages like pain and suffering. The problem with non-economic damages is that they are very hard to quantify, but even harder to cap. If you lose your child because a nurse gave them the wrong dose of medicine, what is that pain worth? If they amputate your good right leg, instead of your bad left leg, so you are then left with no legs, what is that worth? I realize these are extreme cases, but they exist. I know that if my loved one was severely disabled because the Doctor showed up to surgery hung over from a night of partying and made a preventable mistake, $250,000.00 would not seem like very much money.

Another provision I have a problem with, partly because I am an attorney, is the limitation on attorney’s contingency fees. Before you get up in arms and make a greedy attorney joke, think about whether or not you would agree to work for over a year 10-12 hours a day without knowing whether or not you were going to get paid at all. This is what a contingency fee is. It is really easy to criticize when you hear about an attorney receiving a couple million dollars as a fee, but the cases where they spend hours of time and thousands of dollars preparing for trial and receive nothing in return don’t make the news. An injured party’s ability to make an agreement up front with their attorney regarding compensation is not what is driving up the cost of Healthcare. I have never tried a Medical Malpractice case, but I hear the time and effort involved is extreme. I can assure you no attorney takes one on lightly, and they should be paid for their work.

Finally the bill limits punitive damages to situations where 1) it is proven by clear and convincing evidence that a person acted with malicious intent to injure the claimant or deliberately failed to avoid unnecessary injury the claimant was substantially certain to suffer; and 2) compensatory damages are awarded. Further, the punitive damages awarded are limited to the greater of two times the amount of economic damages or $250,000.00. This provision doesn’t bother me as much as the non-economic damages. Punitive damages are designed to be punishment. Punishment by definition is something that can be pre-set. We have pre-set punishment ranges for everything from speeding to murder.

I do not purport to have the answers. The interaction of the legal system with the medical system is very complex. I commend Representative Gingrey for attempting to tackle this issue. I hope his Bill does make it to the floor of the House, and we do get a national debate going on some of these issues.

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