Recently, I blogged about a Public Citizen report that documented the ways in which tort “reform”, specifically medical malpractice damage caps, are a scam that has done none of the things its backers promised. You might have read that and thought “sure, but Public Citizen is a lefty group, and so they would never have liked med mal caps to begin with”. If so, then you should know that a researcher at the libertarian Cato Institute just released a paper that came to similar conclusions. Here’s a quote:
When asked how consumers benefit from medical malpractice insurance, industry executives typically mention only patient compensation. Yet much more is at work.
Competition in the market for medical malpractice insurance, and each insurer’s interest in reducing its exposure to malpractice awards, leads insurers to provide oversight that protects consumers from physician negligence. Malpractice underwriters review physicians annually. They evaluate claims histories and investigate loss of hospital privileges, substance abuse, and loss of specialty board certification. They alert the medical community to situations that result in bad outcomes and offer advice on how to reduce such outcomes. The evidence presented here shows that physicians pay a price for putting patients at risk. Carriers reward claims-free physicians and physicians who take part in risk-management activities. The industry provides oversight of risky practitioners, dictates patterns of practice, monitors the introduction of new procedures, imposes policy exclusions for specific activities, and denies coverage in the most egregious cases, precluding affiliations that require insurance.
More broadly, patients derive protection from an interdependent system of physician evaluation, penalties, and oversight that includes hospital and health maintenance organization credentialing and privileging activities, specialty boards, and the medical malpractice insurance industry. Underlying nearly all of these activities is the threat of legal liability for negligent injuries. Reducing physician liability for negligent care by capping court awards, all else equal, will reduce the resources allocated to medical professional liability underwriting and oversight and make many patients worse off. Legislators who see mandatory liability caps as a cost-containment tool should look elsewhere.
So there you have it. And in the irony department, Texas Watch adds this:
The Cato paper is written by Shirley Svorny, an economics professor at Cal State-Northridge and an adjunct scholar at Cato. Her bio reports that she has participated in health policy summits hosted by the Texas Public Policy Foundation.
That would be the right wing, tort-“reform”-touting TPPF. Something tells me Professor Svorny will not be invited to share this research at their next meeting.