What is the goal of Malpractice Reform?

Medical malpractice is an issue that seems to ebb and flow. During health reform, it went away, I think because it is not what Democrats naturally focus on in health policy discussions because trial lawyers are such a large constituency, and Republicans went silent on this traditional issue of theirs because pushing for more on medmal reform would have too obviously lead to a deal on the ACA.

Now that the ACA has been passed, opponents remain viscerally against its implementation, yet no clear vision for what they would replace it with has been offered, and we await court rulings on the constitutionality of the individual mandate. When Republicans drive the agenda as they do in the North Carolina legislature, medical malpractice reform is the first health policy issue to be brought up (Republicans control the House and Senate in NC), in the form of S33. Here are past posts I have written on S33: here and here and here.

In any public policy debate, it is important to take a deep breath and ask yourself what problem is being addressed? When discussing the area of malpractice reform the following problems tend to be brought up by advocates:

• Frivolous lawsuits. This is seen as a self evidently misuse of the legal system.
• Defensive medicine. This is the increase in the health care costs that result due to physicians ordering unneeded tests and the like in order to be able to defend themselves if need be at trial. This tends to be the main reason advocates claim to be for reform.
  
• Reduction of malpractice insurance premiums. If premiums are lower, it reduces the cost of doing business for physicians. This is linked to the issue of supply of physicians, especially the notion that a state with a more litigious climate would lose doctors to another state. There are also intangible benefits of reducing suits for physicians in the form of less worry.
  

The main argument of advocates is that reform of medical malpractice will reduce health care costs as defensive medicine is reduced. How big of a reduction could be expected? The CBO estimated in Fall, 2009 that a national reform that adopted malpractice caps similar to what has been enacted in Texas would reduce the federal budget deficit by $54 Billion over 10 years ($41 Billion in reduced medical care, and $13 Billion in indirect deficit reduction). That is a substantial amount of money, but keep in mind the 10 year total health system spending projection for the same 10 years was around $35 Trillion. So, savings due to malpractice reform are no panacea for our cost problems.

A recent study linked by Avik Roy of Orthopedic physicians in Pennsylvania says that 35% of imaging costs are driven by defensive medicine. This study made me perk up because it is prospective, meaning you investigate something as it takes place, and don't ask people after the fact why they did something. Generally, a prospective study has less bias than does a retrospective study, in which you would be assigning motive after the fact. In this study physicians were noting which tests were medically unnecessary, but ordered simply to provide them with protection should they be sued (they could use the test to show they took care in treating patients).

I cannot find a full copy of the study to completely evaluate the methods, but it sounds like from the abstract that it was a voluntary sample, which might be expected to draw physician participants who are most worried about malpractice, therefore overstating the effect of defensive medicine. I think that in this case, the prospective nature of the study does not necessarily produce better results because they are asking physicians to identify the existence of something that most of them believe to self-evidently be the case. However, in this issue, behavior change by physicians will be necessary for defensive medicine costs to be reduced, so it is hard to disentangle perception, interest, motivation and action.

Putting questions about the methodology aside, lets say that the figure 35% is correct, and that 35% of all imaging ordered by Orthopedic Surgeons is due to defensive medicine AND they know this at the point of ordering the test(s).

This would mean that if we fixed the medical malpractice problem that imaging costs associated with orthopedic practice would be reduced by 35%. This would be a tremendous savings and if we ever slow health spending increases it will mean that some care that would have been provided under the status quo will no longer be provided. Further, if this 35% reduction in imaging costs took place, orthopods will no longer get Christmas cards from Radiologists, but I digress.

The evidence from states that have passed robust malpractice reform shows very little effect on overall costs, though such caps do reduce malpractice insurance premiums for physicians. This means that either the 35% figure is something that is highly specialty specific, or is a case of physicians assigning a particular motivation for doing a test when in fact a variety of motivations exist. [variety of links on the issue of malpractice caps not slowing health care costs a great deal]

We need a more balanced, comprehensive reform of patient safety and medical malpractice, along the lines suggested by the work of Michelle Mello and others. Now the debate is almost always one sided. In fact, here is a press release from the American Academy of Orthopedic Surgeons last week noting the release of the Pennsylvania study noted above, citing a study showing that 4 in 10 suits are filed in the absence of an error, much less negligence, to focus attention on too many suits. However, this same study group also found that 19 or 20 cases of true negligence did not result in a suit. Similarly, legal groups tend to focus only on one side of this story as well.

There is a patient safety and quality of care problem that is best addressed through a change in the medical malpractice system away from an adversarial system toward one that focuses on addressing errors, compensating those injured, seeking to reduce future errors, and stabilizing the malpractice insurance system. S33 in North Carolina does not do this.

update: earlier this morning a one line post was linked....a post fail.
Another update, 10:20am: via Brad Flansbaum, a good piece in The MD column in LA Times arguing reasonably for a more comprehensive reform.

update: 4:30pm: I revised the post to reflect that the CBO estimated that the malpractice policies they reviewed in 2009 would reduce the deficit, by $54 Billion; the post imprecisely said reduce 'costs' by $54 Billion. The $54 Billion would be $41 billion of reduced health care spending and $13 Billion of increased taxes paid as private health insurance premiums were reduced, leading to slightly higher wages that are taxable, whereas employer paid insurance premiums are not taxable.