CBO Report on Medical Malpractice Flawed

Stuart Hagen must either be greatly overworked or possessed of an overwhelmingly monetized mind.

As the author of a Congressional Budget Office's reply to the request
by Senator Orrin G. Hatch (R-Utah) for an "updated analysis" of
medical malpractice reform, Hagan neglected to mention a salient
tragedy. About 100,000 Americans die every year from medical and
hospital negligence or worse in hospitals alone.

That loss of life is greater than the annual combined fatalities from
motor vehicle crashes, AIDS, and fires. This report on medical and
hospital negligence came from physicians at the Harvard School of
Public Health. Such preventable fatalities are associated with even
larger numbers of preventable sicknesses and injuries. Tens of billions
of dollars a year are the economic costs to victims, their next of kin
and the economy.

The Congressional Budget Office (CBO), led by Douglas W. Elmendorf, is
one of two Congressional offices left with any credible reputation-the
other being the Government Accountability Office (GAO). The October 9,
2009 five page CBO report belies that reputation (https://www.cbo.gov/ftpdocs/106xx/doc10641/10-09-Tort_Reform.pdf).

The customary right-wing reform literature on corporate regulation and
tort-law rights dwells on inflated costs and blithely ignores benefits
in terms of saving life, limb and property and compensating the
aggrieved. This propaganda binge, spasmodically reproduced by the likes
of the Wall Street Journal, Forbes, and National Review editorialists,
started with Murray Weidenbaum, economic advisor to Ronald Reagan. In
his first report after leaving office about twenty-five years ago, he
arbitrarily declared that federal regulation cost business $150 billion
a year-since bloated in subsequent published effusions to over $800
billion. When I asked Mr. Weidenbaum what about the benefits of health
and safety from safer cars, food, water, drugs and other products, he
replied that was not his research burden. He was focusing on costs.

Mr. Hagen's dispatch to Senator Hatch suffers from the same flawed analysis.

In the corporatized world of the Congress, "medical malpractice reform"
means limiting the rights of wrongfully injured people to their full
day in court. It does not mean reducing the prevalence of medical
negligence, incompetence or greed, with all its lethal effects.

If reform meant reducing deaths, illness and sickness from bad doctors
and bad medicine, powerful commercial interests would have to behave
and upgrade their services ranging from prevention to treatment.

For example, medical malpractice insurance companies would have to
experience-rate their physicians and surcharge the small percentage of
recidivist, negligent or incompetent doctors. Drug companies would have
to be subjected to stronger safety standards and recall obligations and
stop their payola to physicians to get them to prescribe unnecessary
medications or improper medications in our overdrugged society.

Also, state medical examining agencies would expand their staff and
have their authority strengthened to remove the licenses of the small
percentage of physicians who should not be practicing medicine at all.
As Business Week editorialized years ago, the medical malpractice
crisis is malpractice.

Hospitals, as some already are doing, would be cracking down on
hospital induced infections with improved monitoring and simple
sanitation like handwashing. The Centers for Disease Control estimates
260 to 270 deaths a day, 99,000 per year, due to hospital-induced

Obviously these are not the kinds of human protections and
cost-reductions on the minds of the Hatch Republicans and some
lobby-indentured Democrats like Senator Max Baucus (Dem. Montana). But
the CBO should not be reflecting this political slant. Like the Office
of Technology Assessment, which Congress abolished in 1995, the CBO's
job is to convey the truth as best they see it regardless of the angle
desired by Senators or Representatives.

The Center for Justice & Democracy (CJD) has just issued a fair critique of the CBO letter to Senator Hatch (https://www.centerjd.org/archives/issues-facts/CJDCBOCritiqueF.pdf).
CJD points out the savings, both human and economic, that come with the
deterrent effects of the tort law system. Among the studies cited is
the Institute of Medicine finding that "[T]he litigation system seems
to protect many patients from being injured in the first place. And
since prevention before the fact is generally preferable to
compensation after the fact, the apparent injury prevention effect must
be an important factor in the debate about the future of the
malpractice litigation system."

Further, in the May 11, 2006 issue of the New England Journal of
Medicine, the CJD argued that "anesthesiologists were motivated by
litigation to improve patient safety." As a result, "the risk of death
from anesthesia" was reduced from "1 in 5000 to about 1 in 250,000."

Less than one in ten malpractice cases results in a legal claim for
compensation. What physicians and hospitals pay in malpractice premiums
annually is less than the cost of dog and cat food-under $10 billion.

Mr. Hagen and associates provided estimates of five "typical proposals,
starting with a cap of $250,000 on pain and suffering for the most
serious injuries. Such proposals have been the subject of various state
rejections or enactments without significantly affecting the prices
charged for malpractice insurance premiums. Even if they did, the human
cruelty and pervasions of the insurance function itself should negate
their adoption.

The CBO letter did not include the costs to Medicaid when victims do
not receive an adequate award or settlement in court, to cite several
omissions noted in the CJD analysis. CBO's treatment of "defensive
medicine" is thin, neglecting to point out that incentives for
additional billing are factors; while invasive, non-indicated
procedures for fear of fancied liability are themselves acts of

Messrs Elmendorf and Hagen: even the best companies have bad days. It is time for a CBO recall!

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