There is a new story on dallasnews.com which discusses new evidence that malpractice damage caps are not a fix for high health care costs. The argument advanced by tort reformers in the halls of Congress, as well as the halls of state legislatures all over the country, is that 1) doctors pay high premiums to insurance companies to protect themselves against malpractice suits, and 2) the cost of these premiums are passed on to consumers, which makes health care more expensive.
Texas passed a medical malpractice lawsuit cap in 2003, limiting the amount of general damages (non-economic damages such as pain and suffering, loss of enjoyment of life, and mental anguish) to $250,000, no matter how egregious the harm done to the patient. According to the article, the law produced a 30 percent drop in doctors’ mapractice insurance premiums.
However that has not translated into lower medical costs for consumers. The cost of medical insurance premiums rose faster than earnings in Texas. According to Families USA, health care premiums in Texas rose a whopping 86.8 percent betweem 2000 and 2007. Medicare spending in Texas increased 24 percent in the three years after the cap was passed.
A study published in December 2008 in the journal Health Sciences Review, found that “(t)ort reforms have not led to health care cost savings for consumers.” The study asks the question “(a)re there other benefits (from tort reform) to consumers? If these cannot be identified, it is difficult to see a justification for the loss of legal rights.”
The benefits acrue to the insurance companies who do not have to pay for the damages covered under their policies. Those hurt are not people who have small injuries and heal up from the malpractice done to them. Those who are damaged by the cap are the severally injured, who then become a burden on society, because the person who caused their injury is not having to pay for the damage they have done.