Several folks wrote saying that a $250,000 cap on non-economic damages won't actually do much (or anything). Just to be clear, standing alone I don't think it will do much. Krauthammer says it will save $200 Billion in defensive medicine. I think he is off by a decimal place, at least, and would be shocked if it saved $20 Billion/year. However, I think that most doctors I know worry alot about being sued. If you think they are simply saying that to enable them to continue to over-provide care out of monetary self interest and claim it is to prep for a potential med mal suit (several emailed me something like this) then think of the $250,000 damage cap as calling their bluff. If cost don't drop after getting the wildest dream proposal of the AMA re med mal, then the negotiating position of the docs will be much diminished. And there are many signs that quality/patient safety concerns have not improved since the IOM published To Err is Human in 1999. And taking this step could be a start to a more patient safety based approach which I think is needed.
So, the $250,000 cap is suggested as a way to get the docs on board in trying to develop a health system that is more focused on value and improving patient safety. It is the first step, not the last one.