Tort Reform Ruled A Failure

by Staff | March 19th, 2015

Tort Reform

Is tort reform just a myth?

For decades the insurance industry spent untold millions trying to convince the public and state legislators that “tort reform” was badly needed to prevent doctors from fleeing the state, to stop “frivolous” lawsuits and runaway jury verdicts, to lower the exorbitantly high malpractice premiums a doctor has to pay, and to end the practice of “defensive medicine.” They promised Utopia if laws were passed limiting a victim’s access to the courthouse, capping the amount an injured person can receive, conferring immunity to some specialties and eliminating many types of claims. They promised the public such laws would lower the cost of and improve healthcare not to mention lower the doctors’ unaffordable insurance premiums. The state legislatures embraced tort reform in many states, including Ohio, and tort reform became the law of the land. The result was this: injured people were left without legitimate compensation for injuries due to negligent medical care, compensation that would have paid for necessary future care and wage loss; it effectively shifted the burden to the taxpayers through Medicaid and Medicare, rather than require the offending party to cover the cost for the harm that was done. After almost of decade of tort reform in Ohio, finally, tort reform has been declared a myth, a scam and a tragedy. All the promises of lower costs — both to the doctor and the patient — better care and less litigation, have gone unfulfilled. In fact, healthcare costs have gone up while hospitals have become dangerous places.

The windfall to the insurance industry has been remarkable. According to a recent Forbes Magazine article, On Tort Reform, It’s Time to Declare Victory and Withdraw, the average returns for malpractice insurance carriers is 15.6%, better than that of property/casualty carriers. At the same time the insurance industry was succeeding in statehouses across the country, medical researchers were putting a spotlight on a disturbing truth: hospitals are dangerous places. The article references the U. S. National Academy of Sciences study which concluded that between 44,000 and 98,000 patients are killed or injured in hospitals every year due to medical mistakes, and only about 1% ever result in a lawsuit.

The New England Journal of Medicine, perhaps the medical profession’s most highly regarded publication, recently published a major study that deflated the myth of tort reform. Doctors and public health experts studied the effects of tort reform in three states: Texas, Georgia, and South Carolina. They focused on emergency room physicians because the researchers knew that “emergency room physicians practice in an information-poor, high-risk, technology-rich environment.” They found that even though emergency room doctors in these states were virtually immune from lawsuits, they behaved just as before – prescribing just as many tests as before. The study confirmed the doctors’ behavior was the same regardless of whether there was a threat of getting sued.

Something that frequently gets overlooked in this debate is that lawsuits, or the threat of one, cause change. Lawsuits, or the threat of one, increases safety. Look at the automobile industry, the aviation industry, the workplace. If you remove the deterrent to selling a cheaply made, dangerous product, people get hurt and the public, not the negligent party, pays the cost.