Medical Malpractice

Medical Malpractice: Questions and Answers

Q. What's wrong with capping damages for injured patients in medical malpractice cases?

A. A one-size-fits-all cap on damages in medical malpractice cases would be a huge setback for patients' rights. Caps take away basic protections from patients in order to benefit the insurance industry. Caps punish victims of serious malpractice like Jesica Santillan, who died after a botched heart-lung transplant, and Linda McDougal, whose breasts were needlessly amputated after she got another woman's cancer test results. With caps, victims and their families wouldn't be allowed to get fair compensation or hold bad and careless doctors accountable. At the same time, caps guarantee bigger profits for insurance companies because they don't have to pay as much when the doctors they cover kill or maim patients.

Q. President Bush and a recent report claim Americans can't find medical care because doctors are being forced to quit their practices due to high malpractice insurance rates. Is this true?

A. No. The claim that doctors are leaving their practices because they can't afford insurance is all hype, according to a USA Today investigation. The claim isn't backed up by statistical evidence, the newspaper said, criticizing a March 3 report by the U.S. Department of Health and Human Services for ignoring "several independent studies that contradict some of its key findings." (USA Today 3/5/03) In fact, the newspaper found that doctors pay less for malpractice insurance than they do for rent.

Q. Are frivolous lawsuits causing doctors' medical malpractice insurance rates to skyrocket?

A. No. The real problem is the insurance industry, which has too much control over America's health-care system. Big insurance companies decide whether patients get the tests and treatment they need, how doctors practice medicine, how much doctors are paid for their services, and how much doctors pay for malpractice insurance. The insurance industry has tremendous power because it's one of only two America businesses not subject to antitrust laws - Major League Baseball is the other - and can legally collude to fix prices. Rates are going up because insurance companies are gouging doctors to make up for investment losses in recent years. Insurers invest heavily in stocks and bonds, so when the economy goes bad, they raise premiums to maintain their profits. It's happened before. Insurance rates also skyrocketed during similar economic downturns in the mid-1980s and mid-1970s. And doctors aren't the only ones being gouged - rates are rising fast for all types of insurance, including automobile and homeowners.

Q. If Congress puts limits on lawsuits by injured patients, will it solve the problem of skyrocketing medical malpractice insurance rates for doctors?

A. No. As Business Week and USA Today have reported, there's no evidence that limiting jury awards in malpractice cases results in lower insurance premiums for doctors. In Nevada, the Legislature passed a $350,000 cap on malpractice cases last year after heavy lobbying by the insurance industry. Shortly afterward, major medical malpractice insurers announced they had no intention of lowering rates for doctors. And early this year, Nevada's three principal malpractice insurers announced rate increases of 17 to 93 percent. In Missouri, another state with a cap on damages, medical malpractice premiums are going up dramatically even though the number and cost of claims have been declining steadily. Supporters of caps often point to California as proof that limits on juries bring down insurance rates for doctors. But they're wrong. Although the California Legislature passed a $250,000 cap in 1975, malpractice premiums continued rising for more than a decade after that. Only when voters passed insurance reform did doctors begin to get relief.

Q. Are jury awards in medical malpractice cases out of control?

A. No. The average size of verdicts is relatively low and has remained stable over more than a decade. A study by Americans for Insurance Reform found there has been no "explosion" in medical malpractice payouts in recent years. In fact, payments (in constant dollars) have been virtually flat since the mid-1980s. In 2000, the median malpractice payout was $125,000, according to the National Practitioners Databank.

Q. Isn't limiting "pain and suffering" damages a good idea since they're only awarded in frivolous cases where people don't have real injuries?

A. No. What non-lawyers mistakenly call "pain and suffering" damages actually compensate people for real, devastating and life-altering injuries. They include loss of a limb, blindness, paralysis, loss of sexual function or fertility, and death of a family member. These damages are referred to as "non-economic" because they are not easily measured in terms of money. In comparison, "economic" damages are easy to calculate because they compensate people for such things as out-of-pocket medical expenses and lost income when they no longer can work due to malpractice.

Q. Will limits on medical malpractice lawsuits help make health care more affordable for patients?

A. No. Malpractice costs are such a small part of overall health-care costs that even getting rid of all malpractice lawsuits wouldn't have an impact. In the United States, malpractice insurance costs accounted for only one-half of one percent of total spending on health care in 2001, according to data from the Statistical Abstract of the United States and A.M. Best, the insurance industry's leading provider of information.

Q. President Bush and cap supporters say there are too many frivolous lawsuits against good doctors. Is this true?

A. No. Most victims of medical malpractice never even file a claim and those who do face an uphill battle in court even in the most serious cases. According to a Harvard University study, only one in eight people injured by medical negligence ever files a claim. And, as USA Today reported, people who file claims face huge hurdles because "lawyers sometimes have trouble finding a local doctor who will testify to a colleague's mistakes" and "jurors often are inclined to give a physician the benefit of the doubt." (USA Today 3/5/03)

Don’t Let Them Put Profits Over People!