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Tackling Health Care Costs

By Rep. Tom Price (R-GA), M.D.

PriceWebPhotoWith much fanfare and political wrangling on Capitol Hill, the signature domestic policy initiative of President Barack Obama’s administration – health care – has been signed into law.  From the very beginning of this debate, individuals of good faith on both sides of the political divide shared a common goal of expanding health coverage to more Americans.  However, there were many of us who opposed the Democrat health plan and firmly believe that the ultimate package was fundamentally flawed and failed to meet American principles of reform.

Foremost among the missed opportunities: addressing the rising cost of health care and health insurance.  These issues are not significantly addressed in the new law.  Third-party, non-partisan estimates done by the Congressional Budget Office confirm that the price of health care and insurance premiums will continue to rise under the new Obama health plan.  In fact, CBO determined premiums for those without employer-provided insurance would see an increase of 10 to 13 percent.

There are many factors that contribute to this failure to bend the cost curve downward.  Some are created by the new law – namely new restrictions on the type of insurance offered, taxes on innovative medical equipment, and maintaining barriers to shopping for insurance across state lines.

Another key contributor to rising health care costs is something almost entirely ignored in the expansive law – lawsuit abuse reform.  No realistic plan to lower the cost of health care will succeed unless we have the common sense to come to terms with the cost of defensive medicine.  A recent Gallup survey of American physicians found that 21 percent of all tests and treatments ordered by doctors were done to mitigate the threat of frivolous lawsuits.  That equates to 26 percent of all health care dollars or $650 billion annually obligated to the practice of defensive medicine.  It is a staggering sum that we should all agree is a gross misallocation of time and money.

Under the new health care law, lawsuit abuse reform is all but ignored.  The plan allows for study of the issue through so-called demonstration projects.  But most any physician, myself included, who has spent time caring for patients, understands that we do not need more study.  We need action.

One positive avenue of medical liability reform is to establish a new system equipped to handle the unique nature of medical malpractice cases.  We have introduced just such a plan in the HealthCOURT Act (H.R. 3372).  This is a two-pronged approach that would first create a nationally recognized set of best-practice standards to provide an affirmative legal defense for practicing physicians.  The guidelines would be set by physicians, not bureaucrats, and focused on ensuring the highest quality of care.  Should specific cases require litigation, this bill would assist states in launching new health courts tasked with resolving disputes – first by an expert panel’s recommendation and then ultimately a health care tribunal if the issue is not settled.  It is important from a constitutional standpoint, however, to note that nothing in this approach would deny individuals from seeking further appeal to a state court.

Clearly, it is not just defensive medicine that drives up health care costs and insurance premiums.  But it is extremely troubling that the legislation just signed into law ignores billions in annual health care dollars that could be saved or put to better use.  What a remarkable missed opportunity.  It was one of many in this bill.

From the very beginning, many of my colleagues and I objected strenuously to a strategy for health reform that vested too much control and decision-making power in Washington at the expense of patients and their doctors.  By assuming a government-focused foundation for reform, the current law will, unfortunately and predictably, undermine long-term efforts to expand quality care while adding to an already untenable budgetary crisis in our nation.

The new health care law will ultimately cost future generations much more than it will save them.  Tackling lawsuit abuse reform as a part of this broad package would have been one tangible avenue to reduce the cost of health care for families, physicians, and the federal government while protecting the quality of care for patients.  We should not continue to ignore this clear and positive solution.

Rep. Price is a physician and Chairman of the Republican Study Committee


  1. The party of “No” aka Republicans want to protect Insurers with straw man arguments. They were in power for years and indulged in an orgy of spending. So Rep. Price has no leg to stand on. Malpractice cost is a very small slice of the Health Care pie. In any case, premiums remain high even if claims go down. The average claim is quite small and it appears Insurers want to find new ways to crank up profits to absurd levels, yet want a bailout (AIG) when their investments go bad! They violate legitimate insurance claims regularly, in effect commit legalized fraud. Pharma companies produce something useful and contribute to health care….The President’s plan is just a start, for the Democrats have mostly been spineless and have not adequately protected the public at large.

  2. scott mccracken

    Thanks for contributing this, Rep. Price.
    There’s no doubt this reform leaves us (still) with a lot of work to do to improve healthcare. I understand you fiscal concerns, and think they’re valid, partilcularly with respect to the cost of defensive medicine.
    I will say, however, that I supported the bill because I think that it will create better care for many, many patients.

    The party line vote disappointed me, though, because it just shows the continued business-as-usual approach in Washington. At some point, some of congress has to break the incumbency-focused lock-step approach to legislation and debate. For example, in the context of this recent vote, how can serious medical malpractice reform, labeled as a Republican issue, stand a chance of success? Liability reform is a win for patients and a win for the healthcare system, and should be a legislative priority for any congressional delegate who supports patients and the healthcare system.

  3. This proposal smacks of further expanded government, by making a special court system set aside specifically to protect insurers. How is that an honest attempt to “meet American principles of reform”? It sounds like another costly corporate bailout at the public expense.

  4. Paul Fitzpatrick

    Granted there are a number of issues wrong with the new healthcare legislation. This was not for lack of trying to incorporate changes that would have helped greatly. But to make a case that litigation is something that will continue to drive up the cost of health care is trivializing the issue.

    Anyone familiar with malpractice insurance rates would agree that they are too high and have driven a number of practitioners out of practice or out of state. And something needs to be done. However the solution isn’t to limit the litigants options or, as in the case of the pharmaceutical companies under the Medicare Part D legislation, grant imunity not only from new law suits but also pending suits, is outrageous.

    Physicians who spend time with their patients and interact with them. Provide answers to questions, display a good “dedside manner” have fewer lawsuits. It has been shown. Even Physicians who perform less than ideally but have a good raport with their patients are less likely to be sued than a physician who performs above par yet lacks in patient skills.

    So, work on the conegiality and lets see what happens to the law suits.

    Thank you.

    Paul Fitzpatrick

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