MALPRACTICE CAPS: Reforms Could Boost Health Costs By $6 Billion, Say Business Groups
The state's health care costs could balloon by $6 billion a year if the quarter-million dollar cap on "pain and suffering" malpractice cases is lifted, according to a study sponsored by a coalition of health care providers and the California Chamber of Commerce. Trial lawyers were quick to protest in what the San Francisco Chronicle reports "is the first shot in what is expected to be a high-profile battle this year to reform" the 1975 law that set the maximum award in malpractice cases at $250,000. State Chamber of Commerce President Allan Zaremberg predicted that Assembly Speaker Antonio Villaraigosa (D-Los Angeles) "will introduce a bill this session to raise or eliminate" the cap at the urging of his trial lawyer "political allies" (Russell, 12/18). The study, conducted by the Law & Economic Consulting Group for Californians Allied for Patient Protection, predicted that altering the cap would "cause higher health insurance premiums for many Californians and cause some consumers to lose coverage entirely." The Sacramento Bee reports that malpractice attorneys charge the cap has been outpaced by inflation and is out of whack compared to the limits in other states. "There's been no adjustment in 23 years and, as a result, California is in the bottom 2% of all states nationwide dealing with medical malpractice awards," attorney Roger Dreyer said (Ferraro, 12/18).
The Chronicle reports that William Hamm, who conducted the study, predicted that an outright elimination of the cap would spur "defensive medicine," with health care providers "performing unnecessary and expensive procedures to minimize risk of a lawsuit." That would push up doctor bills 16% and hospital fees as much as 17%, he said. But while business, hospital and physician groups warn that removing or lowering the cap could mean a decrease in health care access, consumer groups complain that the decreased value of settlements makes lawyers hesitant to even take on medical malpractice cases. They claim that leaves patients with no recourse if they are injured by a negligent health care provider (12/18). Click malpractice caps for previous coverage of this issue.