Defensive medicine involves adding steps to the course of care out of fear of litigation, rather than hope for a treatment outcome.
high-dollar verdicts this way leads to harming the very people jurors wish to help: patients.
Large Verdicts Pay Attorneys — and Investors Although juries that award large sums to plaintiffs may feel concern for an injured person, 40% or more of that indemnity can go to the plaintiff’s attorney, not the plaintiff. Further, most Americans are unaware that people invest in medical malpractice lawsuits and hedge funds often float plaintiffs’ attorneys’ litigation in exchange for a share of the settlement or jury award. Enriching these third-party funders is probably not what jurors have in mind when they choose massive awards.
Large Verdicts Promote Defensive Medicine “Defensive medicine” is a familiar phrase, but what does it mean? Defensive medicine involves adding steps to the course of care out of fear of litigation, rather than hope for a treatment outcome. For instance, many of us are familiar with the idea that doctors may seek to protect themselves by ordering medically unnecessary tests. This increases the cost of health care overall. The exact amount of spending increase is unknown, but many estimates would concur that defensive medicine adds at least $55 billion per year to U.S. health care costs. Tort reform measures, including caps on noneconomic damages, can help mitigate these fears and added costs.
Large Verdicts Cost Us All: The Tort Tax Nuclear verdicts create ripple effects that spread far beyond the parties to a medical malpractice lawsuit. Eventually, premiums for medical professionals are affected, and increases in premiums for health care professionals can affect the cost of care. This is how nuclear verdicts impact everyone’s cost of living: through what is known as the “tort tax.” The U.S. Chamber of Commerce Insti-
tute for Legal Reform calculated a tort cost equivalent to 2.1% of gross domestic product, or $3,621 per American household.
Steering U.S. Healthcare Through the Challenges Ahead Numbness to large numbers is not isolated to the consideration of legal matters. Our collective inability to take in large quantities applies to comprehending the human toll of natural disasters and other crises, too. But social inflation is easier to prevent than an earthquake. We can let our elected representatives know that we support damage caps and other tort reform measures. A survey conducted by the American Property Casualty Insurance Association and Munich Reinsurance America indicates that many Americans are not aware of litigation aspects such as third-party litigation funding or the potential impact on their own household costs — but upon learning about these issues, most people surveyed wanted common-sense reforms. Halting social inflation won’t overcome vaccine misinformation, integrate new technologies or resolve our doctors shortage — American health care has plenty of challenges to navigate. But it will be easier for U.S. health care to steer through those obstacles if it is piloted by clinicians who are free from fears of crippling litigation costs. The guidelines suggested here are not rules, do not constitute legal advice, and do not ensure a successful outcome. The ultimate decision regarding the appropriateness of any treatment must be made by each health care provider considering the circumstances of the individual situation and in accordance with the laws of the jurisdiction in which the care is rendered. If you have questions, please email TDC's PR Director Kelly Cinelli at kcinelli@thedoctors.com. Today’s FDA | 45