What is Tort reform?

[Emma]

How about we look at the whole picture regarding tort reform, using Canada as an example. Canada keeps malpractice cost in check - St. Petersburg Times

Some highlights of the article:

For neurosurgeons in Miami, the annual cost of medical malpractice insurance is astronomical — $237,000, far more than the median price of a house.

In Toronto, a neurosurgeon pays about $29,200 for coverage. It's even less in Montreal ($20,600) and Vancouver ($10,650).

The costs are strikingly different, largely because of the ways in which Canada insures doctors and protects those who are sued:

• In 1978, the Canadian Supreme Court limited damages for pain and suffering. Adjusted for inflation, the cap now is just over $300,000. The United States has no federal cap on damages, though a few states, including Florida, have imposed them.

• Instead of buying insurance from a for-profit company, as most U.S. doctors do, Canadian physicians are covered through their membership in the nonprofit Canadian Medical Protective Association.

A difference of ten times or more is what our health care providers are paying. Doesn't that indicate some substantial cost savings for the health care providers, if there was a similar cap as in Canada?

Or perhaps your last point I highlighted above.

I still don't think this is a Federal issue that Congress needs to address.

 

[Christopher]

How about we look at the whole picture regarding tort reform, using Canada as an example. Canada keeps malpractice cost in check - St. Petersburg Times

Some highlights of the article:

For neurosurgeons in Miami, the annual cost of medical malpractice insurance is astronomical — $237,000, far more than the median price of a house.

In Toronto, a neurosurgeon pays about $29,200 for coverage. It's even less in Montreal ($20,600) and Vancouver ($10,650).

The costs are strikingly different, largely because of the ways in which Canada insures doctors and protects those who are sued:

• In 1978, the Canadian Supreme Court limited damages for pain and suffering. Adjusted for inflation, the cap now is just over $300,000. The United States has no federal cap on damages, though a few states, including Florida, have imposed them.

• Instead of buying insurance from a for-profit company, as most U.S. doctors do, Canadian physicians are covered through their membership in the nonprofit Canadian Medical Protective Association.

A difference of ten times or more is what our health care providers are paying. Doesn't that indicate some substantial cost savings for the health care providers, if there was a similar cap as in Canada?

Or perhaps your last point I highlighted above.

I still don't think this is a Federal issue that Congress needs to address.

Regardless of your "perhaps" about the second bullet, it is still clear that the first bullet point has a substantial effect on health care provider costs as the article indicated. If we are to go to universal health care and we are to use other countries as a model, why would we not do this?

Why do you not want Congress to address it? What is the reasoning? It seems to work well for Canada to keep malpractice costs down.

 

[Emma]

How about we look at the whole picture regarding tort reform, using Canada as an example. Canada keeps malpractice cost in check - St. Petersburg Times

Some highlights of the article:



A difference of ten times or more is what our health care providers are paying. Doesn't that indicate some substantial cost savings for the health care providers, if there was a similar cap as in Canada?

Or perhaps your last point I highlighted above.

I still don't think this is a Federal issue that Congress needs to address.

Regardless of your "perhaps" about the second bullet, it is still clear that the first bullet point has a substantial effect on health care provider costs as the article indicated. If we are to go to universal health care and we are to use other countries as a model, why would we not do this?

Why do you not want Congress to address it? What is the reasoning? It seems to work well for Canada to keep malpractice costs down.

Oops. Sorry. Got my tort threads mixed up lol.

http://www.usmessageboard.com/1445637-post7.html

 

[VaYank5150]

Why Texas Auto Insurance Consumers Have Not Benefited from "Tort Reform"

A Response to the Texas Department of Insurance

Austin, TX -- Insurance Commissioner José Montemayor will soon announce his decision on "tort reform rate reductions". This announcement will be the last of five annual tort reform rate reduction decisions by the Texas Department of Insurance (TDI). As in the past, we expect TDI to claim hundreds of millions of dollars in savings to consumers from "tort reform." For private passenger automobile insurance, TDI has already claimed the following savings:

1996 $178.5 million
1997 $177.9 million
1998 $247.4 million
1999 $247.4 million

These claims are simply do not hold up under scrutiny. In fact, Texas auto insurance consumers have not seen reductions in premiums as a result of "tort reform." Rather, CEJ’s August 1999 report on Texas auto insurers profitability shows the following overcharges to Texas auto insurance consumers

1996 $728.9 million
1997 $1,193.3 million
1998 $960.4 million


How can there be such a disparity in claims of "tort reform" impact? This memo supplements the August 1999 CEJ report to help sort through the various claims.

Fact versus Fiction: How did TDI come up with its estimate of "tort reform" savings?

TDI verifies and calculates "tort reform" savings by reviewing forms submitted by insurance companies. On these forms, insurance companies estimate what their losses and premiums would be without the "tort reform rate reduction" and then apply the "tort reform rate reduction" factors to these estimates. The resulting calculation is the estimate of "tort reform savings".

The first question that comes to mind is, why wouldn’t the insurance companies simply inflate their estimates of pre-"tort reform" losses and premiums to avoid having to actually reduce rates by the appropriate amount? This appears to have actually been the case. Actual premiums charged to consumers did not decline. Rather, insurer profitability increased because of lower losses.

If insurers were actually lowering rates because of tort reform rate reductions, we would expect to see declines in premiums and constant loss ratios over time. Loss ratios – losses divided by premiums – should be constant over time because reductions in insurers’ claim payments would be matched by reductions in premium.

What happened? As the CEJ report shows, despite "mandatory tort reform rate reductions," auto insurance premiums continued to increase, loss ratios fell dramatically and auto insurers reaped windfall profits from 1996 through 1998. Tables 1 and 6 of the CEJ report show increasing premiums and decreasing loss ratios following "tort reform." Tables 2, 4 and 5 of the CEJ report show the windfall profits of Texas auto insurers. For example, Table 4 shows that bodily injury liability rates for rate-regulated auto insurers were over 41% excessive in 1996 and 1997.

Which is the more credible evidence of "tort reform savings" – the TDI tabulation of numbers on tort reform forms submitted by insurers or the actual premium and loss experience of auto insurers over a three-year period? Despite the TDI claims to the contrary, the insurers’ actual premium and loss experience shows, without doubt, that insurance companies, not consumers, have been the beneficiaries of "tort reform." In contrast to the absence of any facts or evidence to support the TDI claims of "savings," the insurers’ actual premium and loss experience demonstrates conclusively that "tort reform savings" to consumers has yet to materialize.

"It’s not all due to tort reform"
TDI staff have acknowledged the radical reduction in auto insurance losses and the record profits of Texas auto insurers. But, TDI staff argue that not all the reduction in losses is due to tort reform. Some of the loss reduction, they argue, is a result of other factors, such as safer cars and the aging of the driving population.

What TDI fails to mention is that, for rate-regulated auto insurers, TDI is responsible for ensuring that rates are fair, reasonable and not excessive. Thus, if an insurer submits a rate filing that is excessive, it is TDI’s responsibility to challenge that filing and force the insurer to file lower rates. Whatever the cause of dramatically lower losses, it is TDI’s responsibility to ensure that rates are not excessive – whether accomplished by mandatory tort reform rate reductions or by challenging insurers’ rate filings. Thus, when TDI says that not all the loss reduction is a result of tort reform, they are simply admitting to failing to adequately review and challenge insurers’ rate filings. Consumers do not benefit from "tort reform rate reductions" if the insurance companies lower rates on one piece of paper, but raise them on another.

"Rates have come down."
TDI staff have argued that rates have come down. They provide a chart showing the decline in rates compared to declines in average losses. TDI staff argue that, while rates may have been excessive, they are now reasonable. Once again, the facts contradict the TDI story.

In April 1998, TDI staff argued the exact same thing before an interim meeting of Texas state senate committees on economic development and civil justice – that rate reductions in early 1998 had lowered rates to reasonable levels. Yet, the actual 1998 premium and loss experience showed yet another year of windfall profits of Texas auto insurers in 1998 as in 1996 and 1997.

The TDI argument that rates have come down in 1999 is particularly shallow. Commissioner Elton Bomer lowered the benchmark rates by 5%, effective March 1999. Yet, few major insurers lowered their rates by even this 5% amount. Nationwide Mutual actually increased its rates by 1.3% in early 1999 before lowering them 2.4% effective October 1, 1999. Thus, even after the rate decrease, Nationwide’s rates are only about 1% lower in 1999 than in 1998 – even though Nationwide’s 1998 loss ratio was only 58%. This 58% loss ratio is about 15 percentage points below a loss ratio that will a reasonable profit. Similarly, the three biggest insurers – Allstate, State Farm and Farmers – lowered rates by less than half of the benchmark rate decrease, despite 1998 loss ratios of only 53%, 61% and 68%.

Once again, the facts contradict the TDI claims. Texas auto insurers have not significantly reduced rates in 1999 and, consequently, 1999 will be the fourth consecutive year of excessive overcharges to consumers and windfall profits for Texas auto insurers.

Press Release on Tort Reform Savings

 

[Emma]

Thanks. That is what I was referring to in highlighting that part of Christopher's post. As long as for-profit insurance carriers are providing liability coverage, reform isn't going to do anything to lower costs; the insurance companies will simply pocket the profits.

 

[VaYank5150]

As long as for-profit insurance carriers are providing liability coverage, reform isn't going to do anything to lower costs; the insurance companies will simply pocket the profits.

This seems so obvious. Why do some individuals refuse to see the smoke screen?

 

[Emma]

As long as for-profit insurance carriers are providing liability coverage, reform isn't going to do anything to lower costs; the insurance companies will simply pocket the profits.

This seems so obvious. Why do some individuals refuse to see the smoke screen?

Hell if I know... I'm still trying to figure out why so many cons argue against their (individual and collective) best interests.

 

[CrusaderFrank]

What is Tort reform?

Howard Dean seems to have a good handle on this issue.

Former Democratic National Committee Chairman Howard Dean, a medical doctor who served as governor of Vermont, said at a town hall meeting on Tuesday night that Democrats in Congress did not include tort reform in the health care bill because they were fearful of “taking on” the trial lawyers.

“This is the answer from a doctor and a politician,” said Dean. “Here is why tort reform is not in the bill. When you go to pass a really enormous bill like that the more stuff you put in, the more enemies you make, right? And the reason why tort reform is not in the bill is because the people who wrote it did not want to take on the trial lawyers in addition to everybody else they were taking on, and that is the plain and simple truth. Now, that’s the truth.”

Link here

Howard Dead, your typical Republican Obstructionist

 

[VaYank5150]

Hell if I know... I'm still trying to figure out why so many cons argue against their (individual and collective) best interests.
__________________

Damn good question.

 

[Emma]

The insurance industry is all about tort reform (in a totally altruistic fashion, of course; worried about how it drives up costs for us little people). I wonder what they'd think if our government set up non-profit medical liability protection as in Canada?

 

[EriktheRed]

For those wanting to dispute the 1.5 percent number from that article, there is a CBO report saying that in the most extreme case, it's maybe two percent.

A little OT from what I quoted, but you've said elsewhere that you support "loser pays". Why is that? Seems to me that unfairly benefits the firms who have the deep pockets.

 

[potter 58]

One thing everyone is missing is about 2% of the Docs cause about 90% of the law suits, get rid of the bad Docs first and the lawyers would starve to death! It will never happen until the AMA gets out of the business of investigating their own, just a thought

 

[VaYank5150]

Howard Dead, your typical Republican Obstructionist

Here's an idea, Sparky. Debate the facts on tort reform that I posted.

 

[VaYank5150]

One thing everyone is missing is about 2% of the Docs cause about 90% of the law suits, get rid of the bad Docs first and the lawyers would starve to death!

Talk about DEATH PANELS!

 

[PoliticalChic]

I'm sorry Gunny, did you miss this part?

we’d be talking about 1.5 percent of health care costs

You must be more discriminating when you view statistics, and see them in context.

The figures that I have been able to find cast wider light than merely malpractice insurance costs.

The healthcare practicianers require far more testing than they would if they didn't have to fear lawsuits: e.g.,there are 100 million MRI's annually.

The total profits of the healthcare industry are .6% of the total dollars spent. Six tenths of one percent.

The costs of the extra test that they feel necessary to protect themselves from malpractice suits demand 9% of the healthcare dollar. That is 15 times the profits of the industry.

While malpractice litigation accounts for only about 0.6 percent of U.S. health care costs, the fear of being sued causes U.S. doctors to order more tests than their Canadian counterparts. So-called defensive medicine increases health care costs by up to 9 percent, Medicare's administrator told Congress in 2005. "
Canada keeps malpractice cost in check - St. Petersburg Times

Now, compare those with these:
"Also, it’s worth noting that while these figures sound like a lot of money — and few would dispute the fact that health insurance company CEOs make healthy salaries — these numbers represent a very small fraction of total health care spending in the U.S. In 2007, national health care expenditures totaled $2.2 trillion. Health insurance profits of nearly $13 billion make up 0.6 percent of that. CEO compensation is a mere 0.005 percent of total spending."
FactCheck.org: Pushing for a Public Plan


But, as you know, tort reform is a political question as the trial lawyers are a major contributor to the Democratic party.
BTW, I heard on the news that the healthcare bill will increase lawsuits as it now allows employees to sue their employers if the employer provides healthcare.

 

[Soggy in NOLA]

Gee, no tort reform? You'd think a bunch of lawyers were in on the process!

 

[VaYank5150]

Chic, please don't tell me you feel sorry for these health insurance companies....

Health insurance is expensive. Small business people are especially hurt by the rising costs to cover employees. And good luck finding affordable coverage if you are self employed. The rates for self employed even healthy people are sobering. So it must mean that health insurance companies are struggling right? They keep raising the rates and finding more and more conditions they don't cover. Deductibles keep going up and each of us is asked to pay more and more of our medical bills even with supposedly good health coverage. Take a look at a recent report "Insuring Health or Ensuring Profit?; A look at the Financial Gains of Washington's Health Insurers." According to the report, the big three carriers in Washington, Regence BlueShield, Premera Blue Cross and Group Health Cooperative saw profits increase from $11 million in 2002 to $243 million in 2003 and $431 million in 2006. Their cash surplus went from $833 million in 2002 to $2.2 billion (with a "B") in 2006. Interestingly enough they did it while covering less people. Over 2.37 million people were covered by the three in 2002 compared to 1.9 million in 2006. So the cost of health care is still going up, but the profits by private health insurance companies are rising even faster. The article shows medical costs rose 16 percent in the same period that health insurance profits went up 23 percent. In 2007, Washington legislators tried to pass a law allowing the Insurance Commissioner to regulate health insurance rates. The law failed. I wonder who lobbied lawmakers to stop it? Consumers who like paying higher insurance rates?

Private Health Insurance Profits Soar | InjuryBoard Vancouver

 

[Maple]

Amid the obstructionists’ claims that health care reform is “socialist” or a means of speeding Grandma towards her deathbed, a large focus of the conservative position on health care reform has been that frivolous lawsuits drive up health care costs and require doctors to practice “defensive medicine” that’s costly and wasteful.

In a recent Washington Post op-ed, Charles Krauthammer put “tort reform” on the top of his wish-list for reducing the costs of the health care system. Gov. Rick Perry of Texas in the Washington Examiner boasts that Texas tort reform that capped injured patient’s damages was the answer to his state’s problems. And the American Medical Association has said it won’t support any health reform bill that doesn’t reduce liability for doctors. “If the bill doesn’t have medical liability reform in it, then we don’t see how it is going to be successful in controlling costs,” James Rohack, president-elect of the organization, told Politico in March. “Why spend the political capital and energy in passing a bill if it is not successful?”


Illustration by: Matt Mahurin
So far Republicans have mostly focused on tearing apart any reform with a role for the federal government, portraying it as the government dictating how long old people get to live. But an undercurrent of those complaints is the insistence of doctors, hospitals, insurance companies and ideological conservatives that medical malpractice claims are out of control and a leading cause of rising health care costs.

The health economists and independent legal experts who study the issue, however, don’t believe that’s true. They say that malpractice liability costs are a small fraction of the spiraling costs of the U.S. health care system, and that the medical errors that malpractice liability tries to prevent are themselves a huge cost– both to the injured patients and to the health care system as a whole.

“It’s really just a distraction,” said Tom Baker, a professor at the University of Pennsylvania Law School and author of “The Medical Malpractice Myth.” “If you were to eliminate medical malpractice liability, even forgetting the negative consequences that would have for safety, accountability, and responsiveness, maybe we’d be talking about 1.5 percent of health care costs. So we’re not talking about real money. It’s small relative to the out-of-control cost of health care.”

The Washington Independent » Tort Reform Unlikely to Cut Health Care Costs

So, is this a GOP smoke screen?

Well that's a bunch of B.S, 85% of physicians perform defensive medicine. That means they will run the same tests on the same patient to make sure they have not made a mistake that they can be sued for. That drives up our costs of medical health care exponentially. Tort reform limits the amount of damages a patient can sue for. The cost of medical malpractice insurance is outrageous, that cost is also passed back on to us, the consumer in the form of higher fees for service.

Bush tried to get this simple reform done during his term, the democrat congress wanted no part of this as they are in the back pockets of the trail lawyer lobbyists. Even democrats know this as it was clearly stated by one of them during a town hall meeting, I am sure you can find that video on U- tube.

No one can be serious about reducing the costs of health care until they first address tort reform. That's why I beleive that HR 3200 is nothing more than a takeover of 6% of our economy, with absolutely no interest in reducing the costs of health care by our government.

If you are interested google HR3400- that's where tort reform is stated and it is the republican plan for health care.

 

[Polk]

For those wanting to dispute the 1.5 percent number from that article, there is a CBO report saying that in the most extreme case, it's maybe two percent.

A little OT from what I quoted, but you've said elsewhere that you support "loser pays". Why is that? Seems to me that unfairly benefits the firms who have the deep pockets.

It's a matter of fundamental fairness.

 

[VaYank5150]

No one can be serious about reducing the costs of health care until they first address tort reform.

I see you too missed, or prefer to ignore this part:

If you were to eliminate medical malpractice liability, even forgetting the negative consequences that would have for safety, accountability, and responsiveness, maybe we’d be talking about 1.5 percent of health care costs. So we’re not talking about real money. It’s small relative to the out-of-control cost of health care.