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Shielding Doctors From Med-Mal Doesn't Help the Bottom Line on Health Care Costs

In a speech yesterday at the American Medical Association's annual meeting, President Obama told doctors that his plan to reduce medical costs and increase coverage can't succeed without tackling the problem of medical malpractice liability and out-of-control jury awards. But in truth, malpractice claims comprise only a small portion of overall healthcare costs and are not considered major drivers of those costs, reports Bloomberg.

Roughly 10 percent of the cost of medical services is linked to malpractice lawsuits and more intensive diagnostic testing due to defensive medicine, according to a January 2006 report prepared by PricewaterhouseCoopers for the insurers' group America's Health Insurance Plans. A Congressional Budget Office report from 2004 found that medical malpractice costs only contributed to 2 percent of U.S. healthcare spending. In addition, medical malpractice verdicts are on the decline as too are the awards, given that 30 states now cap damages in medical malpractice suits, particularly for pain and suffering.

So why did the President mention medical malpractice liability in the context of cutting costs? Simple -- he hoped to extend an olive branch to doctors to gain their support for a universal health care plan.

And how do medical malpractice lawyers feel about the President's position? The Maryland Injury Lawyer Blog's Ronald Miller was gratified that the President explicitly rejected the notion of capping medical malpractice awards. But apparently, the President's rejection of caps was met with a chorus of boos from doctors.

Posted by Carolyn Elefant on June 16, 2009 at 11:55 AM | Permalink | Comments (2)


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