Myth 8: Tort Reform Is the Solution

Myth 8: Tort Reform Is the Solution

There are two types of tort reform. The more common variety is unilateral tort reform. These reforms make it harder for all persons to sue physicians and to recover adequate compensation when they win a lawsuit. While unilateral tort reform benefits physicians, it does so at the expense of injured persons with meritorious claims. In many cases, it shifts the cost of medical malpractice to society by making the injured person a ward of the state.

Unilateral tort reform is the process of putting obstacles in the way of persons seeking compensation for an iatrogenic injury. It is referred to as unilateral reform because the defendants do not give up any of their traditional protections. Unilateral tort reform may be substantive or procedural. Substantive reforms may limit certain causes of actions such as lawsuits for failure of informed consent, or they may cap the damages that a successful plaintiff can recover. Procedural reforms include shortened statutes of limitations, special restrictions on the qualifications of expert witnesses, and the required use of pretrial screening panels or affidavits to establish that the claim has merit.

Most unilateral tort reform has been enacted without empiric evidence of the magnitude of the problem being addressed. For example, many statutes limit a plaintiff's recovery for pain and suffering to a fixed amount, such as $250,000. This is based on the unsubstantiated belief that large awards for pain and suffering make a substantial contribution to malpractice insurance rates. The lack of proper baseline data also makes studies that purport to evaluate the effectiveness of tort reform methodologically unsound. A drop in insurance rates may be due to tort reform, but it may also be due to the cyclic nature of the insurance business.

Bilateral tort reform attempts to make the tort system more equitable and affordable for both parties. Bilateral reforms are usually based on alternative dispute resolution techniques. (See Chapter 2.) These can make it both cheaper to defend an unfounded claim and easier to prevail on a meritorious claim. Bilateral reforms best serve society's interest in justice. They can be devastating to malpractice insurance costs, however, because they reduce the opportunity cost of presenting a valid claim.[20]

The malpractice insurance carriers have been adroit in persuading general medical societies and specialty societies to lobby for tort reform. These physician organizations have viewed lobbying for tort reform as a no-cost (other than the cost of the lobbyists) benefit. While it is true that unilateral tort reform will reduce certain of the costs of medical malpractice litigation, this is at a political cost to physicians. However necessary and beneficial tort reform may be, lobbying for it puts physicians in the position of asking for a special exemption from the laws that govern other businesses. Moreover, unilateral tort reform clearly benefits the physician at the expense of the injured patient.

The cost of tort reform is that it convinces legislators that physicians are no different from other businesspersons. This reduces the credibility of physicians when they lobby for measures, such as increasing the availability of prenatal care, that benefit the public's health. It also increases the likelihood that legislators will see tort reform as a trade for other special favors that physicians enjoy. As physicians lobby for their own parochial interests, they should not be surprised to find themselves treated as just another trade group.

[20]Mills DH, ed.: California Medical Association and California Hospital Association Report on the Medical Insurance Feasibility Study. 1977.

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Myth 8: Tort Reform Is the Solution