The Congressional Budget Office Director’s Blog post of Dec. 10th noted that an updated assessment of the effects of tort reform revealed a far greater potential savings could be realized than previously thought. The extent of change is quite staggering, going from an estimated $4 up to $52 billion for the period of 2010 to 2019 which is greater than a factor of 13. With our previous research, we strongly feel that even this updated number considerably underestimates the billions of dollars that could be saved annually with appropriate tort reform.
Additional Information on the Effects of Tort Reform
CBO has released a letter responding to questions posed by Senator Rockefeller about our recent analysis of the budgetary effects of proposals to limit costs related to medical malpractice (“tort reform”), as described in a letter to Senator Hatch on October 9. Today’s letter addresses questions about how recent empirical studies affected CBO’s analysis, why CBO’s latest estimates of the budgetary effects of tort reform are larger than the agency’s previous estimates, and whether tort reform would have a negative impact on patients’ health.
Recent Research Findings
CBO’s latest assessment of the effects of tort reform on spending for health care draws on a considerable amount of analysis that the agency has undertaken during the past several years and a stream of recent research studies that have used a variety of data and empirical techniques. Despite that analysis, estimates of the budgetary effects of tort reform are unavoidably uncertain, as is true for many other issues that CBO studies. In dealing with uncertainty, the agency consistently strives to produce estimates that lie in the middle of the distribution of plausible outcomes based upon available knowledge. After a careful evaluation of the research relevant to tort reform, along with discussions with members of the agency’s Panel of Health Advisers who have particular expertise in this topic, CBO concluded that the weight of empirical evidence now demonstrates a link between tort reform and the use of health care services.
CBO’s Updated Estimates of the Budgetary Effects of Tort Reform
CBO had previously estimated that enacting a common package of tort reform proposals would reduce federal deficits by $4 billion from 2010 to 2019, but CBO now estimates that those proposals would reduce federal deficits by about $54 billion during that period. The latest estimates are substantially larger for four principal reasons:
• The estimates include a larger effect of tort reform on medical malpractice costs;
• The estimates incorporate the effect of a gradual reduction in the utilization of health care services resulting from changes in the practice patterns of providers;
• The estimated effect on federal revenues was substantially smaller in the previous estimate (which reflected only a reduction in malpractice costs) than the estimated effect on revenues in the current estimate (which reflects the combined effects of the reduction in malpractice costs and the change in spending attributable to changes in practice patterns); and
• The reduction in utilization is projected to generate a proportionately larger reduction in federal spending on health care than in other spending on health care.
Effects of Tort Reform on Patients’ Health
The potential impact of tort reform on the quality of health care and on health outcomes is an important consideration for policymakers. CBO’s letter to Senator Hatch observed that imposing limits on suits for damages resulting from negligent health care might be expected to have a negative impact on health outcomes. However, the limited evidence currently available about the effects of tort reform on health outcomes is much more mixed than the larger collection of evidence currently available about the effects of tort reform on health care spending.
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We have mentioned numerous times that while the Democrats aver that the Obamanocare/Pelosicare legislation is just about healthcare reform, it unequivocally isn’t. This is an indisputable unconstitutional theft of Americans’ healthcare rights and choices as well as their hard earned income. It is a government confiscation of another 17% of our GDP as well as a payback for political support of the Democrats to labor unions and trial attorneys in particular.
Buried within an even more bloated 1900 page document is a proviso in Section 2531 which rewards trial attorneys by creating disincentives for states that are attempting or have already implemented laws aimed at reducing extortionist medical-legal settlements.
"A state is not eligible for the incentive payments if that state puts a law on the books that limits attorneys' fees or imposes caps on damages."
Characterizing this, IBD note that “… states that have the “nerve” to rein in frivolous medical malpractice lawsuits — and that's 85% of them, according to a Harvard study — would be punished if they also established medical courts where health care experts, rather than untrained juries, settle injury disputes based on actual medical science.”
Once again, the Democrats are legislating what is in their best interest and not what is best for all Americans.
Read: Political Malpractice
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The following op-ed was written by well respected physician, Elizabeth Lee Vliet, M.D. In it, Dr. Vliet delineates her vehement opposition to the present healthcare reform.
In the 2008 campaign, we heard healthcare in this country is “broken” and must be “reformed.” We heard “healthcare reform” would be the signature piece of an Obama Presidency. We were promised no new taxes on anyone earning less than $250,000 per year. We heard promises of transparency in government. We heard promises of a White House that would listen to all. Now that President Obama and a Democratic majority are in office, what have we gotten?
The healthcare proposals have become a massive power grab to control your money, your health options, your businesses, your liberty, and ultimately your life. It is not about insuring the poor.We already have Medicaid to cover the poor.
What the Democratic majority is doing to healthcare in this country is a crime. Punishment won’t fall on Congress and the President, who are excluded from the healthcare proposals. Punishment falls on the American people, especially the elderly.
Word of a new “stealth” strategy to ram healthcare “reform” through the Senate raises even more cause for alarm and adds to the crime of this massive power grab. The plan appears to be for Senator Majority Leader Reid to merge the two Senate bills that have passed out of committee, and attach them as an amendment to a House TARP bill, already passed by the House but curiously gathering dust in the Senate. Once the Senate votes on this “TARP” bill with the healthcare amendment tucked neatly inside, the healthcare punishment is a “done deal” without further debate. Such an abuse of power and due process would be an unforgiveable crime against the American people, perpetrated by the very people elected to represent us.
Instead of “health insurance for all,” the House and Senate healthcare bills have become punishment for all. Here is the list of Americans who face the healthcare “reform” punishment:
- Punishment for the sick. Those who have medical expenses each year will no longer beable to deduct those expenses on taxes until the expenses reach 10% of adjusted gross income (AGI). The current deduction is set at expenses above 7.5% of AGI, so the Senate plan now ADDS a 2.5% tax on those who are already paying out of pocket for medical expenses. Clearly, if someone is spending more than 7.5% on medical costs,that person is ill. The Senate bill makes the sick even sicker from the stress of having to pay more taxes!
- Punishment for the elderly. Medicare cuts of 404 BILLION is the latest figure released by the Senate; earlier the White House budget office said $500 Billion – more than a full year’s Medicare budget – would have to be cut from Medicare. How can anyone begin to think these cuts will not penalize the elderly by delaying, rationing, or denying treatment?
- Punishment for young people. Young healthy people who do not buy government mandated insurance will be punished with the form of a excise tax – reported amounts have been from $1900 to $3800 per person.
- Punishment for anyone not paying the excise tax. The IRS fine for non-payment of tax can be $25,000 and a year in jail. So those who are punished by the new tax risk being accused of a tax crime if they don’t buy government-mandated insurance and who don’t pay the penalty tax.
- Punishment for insurance companies. Companies providing “generous health insurance plans” will be hit with a 35% tax.
- Punishment for consumers who buy “generous” health insurance policies, as the tax on insurance companies is passed on to purchasers.
- Punishment for those who buy their own health insurance…a new 40% tax. Does it really make sense to punish the responsible people who take care of their own healthcare bills?
- Punishment for low income seniors, Hispanics, and Blacks who will lose their Medicare Advantage program under the new proposals.
- Punishment for those with Health Savings Accounts – HSAs will be extinct.
- Punishment for specialists who serve mainly elderly patients, such as cardiologists and oncologists. Such specialists are slated to have their reimbursements for services slashed by 44% under the Senate bill.
- Punishment for medical device makers in the form of new taxes (a tax that will be passed on to consumers).
- Punishment for all doctors, who are required to purchase expensive new computersystems and software to convert to Electronic Medical Records to meet the 2014 mandates in the Stimulus Bill.
- Punishment for those who value their medical privacy. The Stimulus Bill requires all physicians, beginning in 2014, to send patients’ medical records directly to the federal health czar without further permission from patients.
- Punishment for all 50 State governments. Already running at a deficit with the recession, State governments face catastrophic increases in costs with Medicaid costs being shifted to them by the Federal government under the new proposals.
- Punishment for everyone, due to Speaker Pelosi’s proposal for a National Sales Tax (also called a VAT) to pay for healthcare reform. This new tax would hit everyone hard in a recession, and would be on TOP of existing state and local sales taxes.
- Punishments for all. All, that is, except the exempted elite: members of Congress, the President and his family, trial lawyers, and Unions (SEIU, AFL-CIO, and others). The exempted elite retain their private care while becoming the very ones who force more taxes, penalties, higher costs as punishment on the rest of us.
This reminds me of the Soviet Union when I visited there in 1974 and 1975. The Soviet ruling elite were the only ones with cars, comfortable apartments…and access to the best healthcare.
I understand at a personal and professional level the perils of government-run healthcare. I have patients in my practice who have come many countries with government run healthcare that doesn’t address women’s unique health needs. I live in a state with a large Native American population, whose healthcare under the Indian Health Service, run by the federal government, has been abysmal. I have personally had an emergency hospitalization in England. I am walking today because I had the best spine surgery care in the world at Johns Hopkins. If I had lived in Britain, or Canada, or Europe and had to wait for MRIs and surgery, I would paralyzed from the neck down.
I will never agree that nationalized healthcare anywhere provides better quality of care than we have in the United States. I am not alone. Recent polls by different organizations have found that 80-90% of M.D.’s and D.O.’s oppose government-controlled healthcare.
Don’t be fooled by the American Medical Associations endorsement of Obamacare. Only 17% of practicing physicians actually belong to the AMA. Last week’s “white coat” photo op at the White House was a carefully selected group of 2008 campaign donors “Doctors for Obama.” They were NOT anymore representative of practicing physicians across this country than the AMA.
The American people should be even more alarmed by a recent Investors Business Daily poll: 45% of doctors who responded said they would retire or resign from medicine rather than practice medicine under government control. Who will take care of patients then?
The proposed healthcare plans are the most massive transfer of power to the executive branch of government that has ever occurred or has even been contemplated. This concentration of power in the executive branch violates the Constitutional requirement for balance of power, and for separation of powers among the Executive, Legislative, and Judicial branches of government.
This crime against the American people is far worse than the Stamp Act levied by King George.
That was the final straw that set off the first American Revolution.
©Elizabeth Lee Vliet M.D. 10-12-2009
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Arrogance, condescension and prevarication have become quintessential ingredients of the more powerful Democrats. Harry Reid evinced these key traits in his statements regarding healthcare and malpractice reform. The Democrats disingenuously toss about cost of healthcare reform as being around $800 billion to $1 trillion which we all know extremely underestimates the expense. In what was probably somewhat of an extemporaneous comment that inadvertently revealed more reality, Reid stated definitively the cost of healthcare reform to be more than double what other Democrats have been quoting, that is, $2 trillion dollars.
Two telling facts were exposed by his statement regarding savings with malpractice reform. One, that there is little inclination for the Democrats to address this issue despite its preeminent importance. Secondly, his deeming that the estimated saving of $54 billion per year is an “inconsequential” amount is inexcusably arrogant, disdainful and irresponsible. Since when is a billion dollars, never mind $54 billion trivial? That is our money – nearly $750 for a family of four per year!
This is the same attitude that is used when it comes to inserting pork into legislation such as the thousands of individual pork projects that were placed in the stimulus bill (aka American Recovery and Reinvestment Act of 2009 or Porkulus Bill) in February. Five billion dollars here, ten billion dollars there, another fourteen billion dollars for another useless, unrelated project and pretty soon you have billions of REAL dollars REALLY wasted!
The following is the text of Harry Reid's comments as seen in the video:
"He talked about CBO saying that there would be $54 billion saved each year if we put caps on medical malpractice and put some restrictions — tort reform — $54 billion. Sounds like a lot of money, doesn’t it, Mr. President? The answer is yes. But remember, were talking about $2 trillion, $54 billion compared to $2 trillion. You can do the math. We can all do the math. It’s a very small percent."
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The Nevada Secretary of State, Ross Miller who is a Democrat, revealed to Eric Shawn on FOX News that ACORN was hiring convicts who were still incarcerated. Some of these individuals were convicted of identity theft yet their hob was to be canvassing for voters. This is akin to having a sexual predator partying with a room full of provocatively attired cheerleaders who have been plied with alcohol.
With evidence discovered in ACORN offices, officials in Nevada believe this corrupt practices involved individuals who were much higher up in ACORN. They also believe that there is more than sufficient evidence to obtain convictions.
We can see that this organization and its culture are inherently corrupt from top to bottom and across the country. Their illicit partisan activities including voter fraud and ballot stuffing are to be condemned in particular because they can ultimately affect elections and with it, our rights. Yet despite all of this known information, the Democrats who are the beneficiaries of the group’s support, resolutely persist in sending lewd amount of tax dollars to this group. Unbelievably, the stimulus bill that was approved earlier this year allocated right billion dollars to ACORN!
Video: ACORN Hired People "Still In Prison" For ID Theft
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Although Obama claims he that he may “think about considering” some test programs regarding tort reform, his perfunctory attitude on this, ideology and the protection of his constituency do not support any serious commitment on his part. His habitual prevaricating justifies giving no credence to his comments until concrete and serious actions are taken.
Does Obama’s statement that "I don't believe malpractice reform is a silver bullet, but I've talked to enough doctors to know that defensive medicine may be contributing to unnecessary costs" convey a strong conviction that litigation is a problem or that he would champion reform? Definitely not! The word “may” in “may contribute” belies his verbal “commitment” to consider tort reform.
There is abundant and irrefutable evidence that defensive medicine practiced by physicians in attempts to avert malpractice suits comprises around twenty to thirty percent of healthcare costs translating into of tens of billions of dollars wasted annually. Even with trillions dollar budgets and deficits, this is still real money.
Read: Republicans Skeptical About Obama Pledge to Consider Tort Reform
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Decisive and effective tort reform is desperately needed in this country. Our uncontrolled legal system lottery has wreaked havoc on Americans, American industries, innovations and on healthcare and healthcare costs. Physicians frequently order tests that would otherwise be unnecessary for patient care just to cover all bases in attempting to reduce the risk of a lawsuit. This is also called practicing defensive medicine and may cost our country at least $200 billion dollars annually. Then there are the direct costs of defending frivolous lawsuits which add billions of dollars more.
There are also the indirect costs such as discouraging otherwise capable individuals from pursuing a career in medicine. Those who decide to become physicians may avoid training and later practicing in very high risk specialties such as Neurosurgery, Cardiac Surgery and Obstetrics, areas where there are already a shortage of providers. Then there are the extremely dedicated, experienced and wise physicians who have been in medicine for many years who no longer want to contend with these stresses and issues and either limit their practices to lower risk procedures or retire from medicine altogether. This translates into losing some of the best and most experienced doctors from the healthcare system, an undesirable and patently avoidable situation.
With this only being part of the total story, consider the arrogance and chutzpah that Obama had when he addressed the AMA on June 15th. Despite being cognizant of the exorbitant and unnecessary costs that liability issues add to the overall price of healthcare, he stated in no uncertain terms that tort reform was not presently a negotiable issue. Of course, this should come as no surprise to anyone as attorneys are among his biggest supporters. With one of his stated goals being to reduce the cost of healthcare cost, it is imperative that he needs to seriously and effectively address tort reform.
Read: Tort Reform Is Key To Health Reform
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The overall healthcare system in the United States is probably the best in the world though it is not without areas that can be improved. If you just listened to the shrill demagogues of the far left wing of the Democratic Party, one would think that we have a "healthcare crisis" in America. However, closer great scrutiny reveals not only do we have the best healthcare delivery system in the world but we also have premier healthcare technologies, cutting edge surgical procedures, and pharmaceutical innovations. What we have in America is a "health insurance catastrophe" largely caused by Congressional mandates over the years, a malignant unfettered tort system wasting tens of billions of dollars of resources annually, and unreimbursed healthcare due to illegal immigration and related issues.
Approximately 1/6th of our population does not have any medical insurance coverage either because of a lifestyle choice, they are temporarily between jobs, have not applied for federal coverage for which they are eligible, or are not a legal citizen of the United States. All of these people, however, do have access to medical care. If they show up in an emergency room , they must be treated. That is a Federal law. They can not be turned away! The rest of us who have employer provided heath insurance plans or have purchased private insurance on our own are paying for these estimated 47 million uninsured.
Let's repeat this again: EVERYONE in America has access to the healthcare system even if they are unable or unwilling to pay for services rendered and even if they have no insurance.
So what is all the fuss about at Town Hall meetings set up to discuss President Obama's obsession with healthcare reform?
Obama and Congressional Democrats claim that this reform is all about increasing the quality of care, increasing affordability and making healthcare available to all Americans. Unfortunately, these reasons are all fallacious and are pretenses for the real goal: Government run and controlled healthcare with social engineering and wealth transfer. Everything else is an intentional LIE! What, for example, does affirmative action in medical school admissions have to do with quality of health care? There are many more affirmative action provisos like this one in the legislation.
All across the United States innumerable Americans - most of whom have never protested anything in their lives - are doing so also because they do not trust the Federal Government. Period. One only need to look at the abysmal track records of Social Security (going broke), Medicare and Medicaid (grossly underfunded and going broke) and the United States Postal Service (posted a $7 billion loss in 2007 and 2008) to see the typical inefficiencies, incompetence and wretched mismanagement characteristic of the Federal government.In the end, we the TAXPAYERS, will be paying the price and ending up with less and rationed care, higher taxes, fewer choices, inferior quality of care and fewer innovations.
Then we have privacy issues, bureaucratic interference in an individuals' medical care, rationing, etc...
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During his press conference on July 22nd, Obama made the following statement regarding physicians, reimbursement and decision making:
“So if they're looking and you come in and you've got a bad sore throat or your child has a bad sore throat or has repeated sore throats, the doctor may look at the reimbursement system and say to himself, ‘You know what? I make a lot more money if I take this kid's tonsils out.”
Though this statement might have been expressed for political reasons in order to reacquire public support for his government takeover of the healthcare system, it once again demonstrates him to be uninformed, irresponsible, incompetent, biased and arrogant. This together with Obama’s stalwart support of trial attorneys who are among his largest benefactors and his unwillingness to explore meaningful tort reform, are just more evidence why he and the government can’t and shouldn’t be trusted in controlling the healthcare system for more than 300 million Americans.
Republican Tom Price, M.D. (R-GA), who had practiced medicine for over twenty years, was incensed by Obama’s comment and the implication that doctors may be more interested in money than in helping patients. He issued the followed response:
“It’s obvious President Obama has absolutely no idea what motivates someone to enter the field of medicine,” said Chairman Price. “Medicine is about service and helping one’s fellow man. By insinuating that doctors make treatment decisions based on how much they will be paid, the President displays an astounding disregard for that service and insults every single medical practitioner.
“The only possible explanation for such a comment is his failure to understand the root problems and challenges of our health care system. If the President is sincerely interested in reducing unnecessary procedures, he should speak to his friends in the trial bar about medical malpractice reform. Instead, the President would rather attack those who are responsible for providing the highest quality healthcare in the world.”
Who do you want managing your healthcare, Doctors or politicians and attorneys? We thought so!
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