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Tort Reform, Schmort Reform: Limiting Medical Malpractice Suits May Not Lower Overall Healthcare Costs

Jason Millman with the Washington Post writes about the results of a Rand study showing that “tort reform” may not do what proponents thought it would do. (See “Study: Don’t expect big health-care savings from medical malpractice reform.”) The goal of tort reform is to limit the right of injured patients to sue for medical malpractice and thereby drive down the costs of healthcare by easing doctors’ so-called compulsion to practice defensive medicine.

The underlying premise of tort reform is that doctors practice defensive medicine in order to avoid medical malpractice lawsuits. We must eliminate “frivolous” malpractice suits, so goes the argument (frivolous suits are those without sufficient legal merit) because these suits drive up the cost of healthcare.

What Is Defensive Medicine?

Defensive medicine is the practice of ordering tests and performing other treatment functions that may not be necessary under the circumstances. Yet the doctor apparently feels compelled to order these tests anyway to avoid a lawsuit if things go poorly with the patient.

According to Millman, the study involved three metrics:

  1. How often ER doctors ordered advanced imaging studies
  2. The rate of inpatient admissions after the initial visit to the ER
  3. Total charges for an ER visit

For a doctor practicing defensive medicine, the rates on all of these metrics would be higher than in those states that have enacted tort reform (such as California). The ER doc would order unnecessary advanced imaging studies, be more prone to admit a patient to the hospital, and have costlier ER cases.

As it happens, among the three million Medicare claims researchers studied, these metrics weren’t substantially affected in those states that have enacted tort reform.

Does Tort Reform Work?

Though several comments point out possible flaws in the Rand study – socrates25 says RAND studies are “always a joke because they are based on the flawed premise that chart review = same thing as talking and examining a human patient.” In that, socrates25 would seem to have a valid point. Nonetheless – given that all studies have some inherent flaws – the underlying and distinct possibility is that tort reform isn’t the panacea supporters thought it would be.

Perhaps all tort reform does is unfairly limit injured patients’ rights.