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The CBO is out with an analysis on the effect of tort reform. Despite Republican claims that it is practically a cure-all for the nation’s out-of-control health care costs, its effect would be very minor. The CBO analyzed the effect of adopting several extremely rigorous changes to our legal system including:
- A cap of $250,000 on awards for noneconomic damages;
- A cap on awards for punitive damages of $500,000 or two times the award for economic damages, whichever is greater;
- Modification of the “collateral source” rule to allow evidence of income from such sources as health and life insurance, workers’ compensation, and automobile insurance to be introduced at trials or to require that such income be subtracted from awards decided by juries;
- A statute of limitations—one year for adults and three years for children—from the date of discovery of an injury; and
- Replacement of joint-and-several liability with a fair-share rule, under which a defendant in a lawsuit would be liable only for the percentage of the final award that was equal to his or her share of responsibility for the injury.
Even if the country adopted all of the proceeding changes, the effect on the federal budget would be small. The CBO predicts that the changes would save government programs $41 billion and generate roughly $13 billion in new revenue over the next decade. If incredibly stringent tort reform were implemented nationwide, “it would reduce total national health care spending by about 0.5 percent.”
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I find the analysis confusing because it cites changes that would have opposing impacts and then combines them. I think to really shut the argument down they needed to exclude the change in joint-and-several liability from the cap on awards since the former seems to increase defensive medicine. However, the most interesting part is that it seems like managed care has as much impact as tort reform and that neither really has a very large impact in any case.
Of course this report won’t be the end of the claims that we have such an expensive system because of the lawyers.
It is amazing the people who have never read the Constitution or the amendments. Tort Reform is against our Constitution, and our rights within it. We are given the right of redress by a jury of our peers. Tort reform takes away our rights, and the very rights of the jury our peers, to award what they deem as right.
They never mention that if they got rid of the bad doctors, hospitals and other bad actors in the Healthcare system we wouldn’t need tort reform because there would be less suits. They always want to hurt the injured to protect the guilty. We see it in all of our court systems, the accused has more rights than the victim.
The Doctors suffer most from the high costs of Medical Malpractice Insurance, but they aren’t marching on washington, because them making a big thing of it would bring to light why there are so many suits. Bad Doctors, bad outcomes, and gross mistakes. So they lobby the Republicans to fight for them, so they can hide in the shaddows, and not have to put their faces out there.
Thanks for the analysis Jonathan. It’s a good talking point about the tort reform distraction.