Costs of defensive medicine...

...are not clear.  Most of the folks who argue that there is a lot of defensive medicine being practiced cite two sources.  First, many surveys by groups like the AMA or some of the specialties (American Academy of Orthopaedic Surgeons, for example) ask their members, "Do you sometimes practice defensive medicine?"  And, surprise, surprise, they usually get about 90% of their members answering, "Yes."  There is never any clarification as to whether they are saying, "Yes,  every day,"  or "Yes, once a few years ago."  The second study cited frequently is a study done in 1996 by two Stanford economists, Daniel Kessler and Mark McClellan.  Factcheck.org talked about that study 5 years ago when George W. Bush referred to it:

The Kessler-McClellan study is one of the few academic studies that has ever attempted to measure the cost of "defensive medicine" attributable to lawsuits. It did so by examining the cost of treating hospitalized heart patients in states that have caps on damage awards and other restrictions on malpractice suits, and comparing them with the costs of treating similar patients in states without such limits on lawsuits.

They concluded that having malpractice reforms led to reductions in medical expenditures of 5% to 9%.

The Kessler-McClellan study is latched onto by medical folks like the American Academy of Orthopaedic Surgeons:

If the Kessler and McClellan estimates were applied to total U.S. healthcare spending in 2005, the defensive medicine costs would total between $100 billion and $178 billion per year. Add to this the cost of defending malpractice cases, paying compensation, and covering additional administrative costs (a total of $29.4 billion). Thus, the average American family pays an additional $1,700 to $2,000 per year in healthcare costs simply to cover the costs of defensive medicine.

Most other analysts agree that the Kessler-McClellan conclusions are not supportable.  A 1999 study in the Journal of Health Economics did the same analysis on the cost of Caesarian sections in states with limits on lawsuits, compared to states without limits, and found that the reduction amounted to about .3%.  That's right -- three-tenths of one percent -- an amount that is statistically insignificant.  A 1994 study by the Congressional Office of Technology Assessment could not find any evidence to support any conclusions about the overall extent or cost of defensive medicine.

The Congressional Budget Office and the Government Accountability Office have analyzed data from cancer wards, nursing homes, doctors' offices and maternity wards, and have not been able to duplicate Kessler and McClellan's results.  A 1999 GAO study called the evidence Kessler and McClellan cited "too narrow" to provide a basis for estimating overall costs of defensive medicine:

GAO: Because this study was focused on only one condition and on a hospital setting, it cannot be extrapolated to the larger practice of medicine. Given the limited evidence, reliable cost savings estimates cannot be developed.

And on Jan. 8, 2004, the Congressional Budget Office also said the Kessler-McClellan study wasn't a valid basis for projecting total costs of defensive medicine.

CBO: When CBO applied the methods used in the study of Medicare patients hospitalized for two types of heart disease to a broader set of ailments, it found no evidence that restrictions on tort liability reduce medical spending. Moreover, using a different set of data, CBO found no statistically significant difference in per capita health care spending between states with and without limits on malpractice torts.

So -- however intuitive the argument may seem to be that the risk of malpractice suits might lead a doctor to perform an otherwise unnecessary test, it doesn't seem to be born out in practice.

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by: cvllelaw @ Wed Sep 09, 2009 at 22:55:38 PM CDT

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Public healthcare may require tort reform

But we both know that it is impossible to get a true financial cost of defensive medicine.  Evidence of this is bourne out by your citation of only three, very limited (and flawed) studies which contributed data (and not just criticism) to the mix.  I'm not saying that you only cited three studies, but that data was only cited from three.  While "reliable cost savings estimates cannot be developed", as admitted in the 1999 study, common sense indicates that they exist.  

There is one consideration though -- doctors get paid more if they perform more procedures -- perhaps that is driving more unnecessary tests than the malpractice hammer.    

Tort reform may become "necessary" if the Government begins to ration publicly funded care by imposing restrictions, such as the rationed care in the UK.  I do not advocate going to the UK system, but I can see a need for a baseline UK-type system to cover the 40-50 million Americans who fall through the cracks, and cannot achieve health coverage otherwise.  Because those doctors would be technically prohibited from performing defensive medicine by UK-type guidelines, they would need to be protected from malpractice lawsuits.  

The most straightforward way to do this, at least in urban areas, is to provide Government hospitals and clinics, run by Government doctors, nurses and staff, who work for a salary, not for a share of the profits.  Sovereign immunity principles can protect government doctors from malpractice suits, unless they are willful or wonton in their negligence or neglect.

We do this already for current and ex-military.  My father is a beneficiary of a VA run clinic.  I see no reason that such a system cannot be extended to the general public -- other than the fact that people will scream, "this is leading us on the path to socialism"!  Right...like public roads, Medicare, public schools, public defense...all "socialist" institutions.  

Speaking of those screamers, did anyone come up with a pithy name for the 9.12.09 "march" (or as someone said, "waddle") on Washington yet -- you know, the (apparently not too many) thousands that will be arriving here soon on our socialized road network, then taking the socialized mass transit, to our city which is protected from terrorists by our socialized defense forces, and then if overexerted, may go to the hospital on a socialized Medicare plan?

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by: RichardWard @ Thu Sep 10, 2009 at 09:14:14 AM CDT

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Sovereign immunity wouldn't automatically apply because it would fall outside the ambit of

traditional governmental actions.  Of course, a legislative act could confer the immunity.

That immunity would survive until the first horror story of malpractice.  

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by: martinlomasney @ Thu Sep 10, 2009 at 09:24:36 AM CDT

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Sovereign immunity

U.S. has general sovereign immunity, but Federal Tort Claims Act gives a limited waiver of that immunity -- a waiver which could be modified for healthcare.  It is not a situation of tort reform, it is just the government saying that I do not consent to be sued if you use this service.

As for the "horror story", government immunity does not necessarily cover the individual for willful or wonton behavior.  Also, I would be very surprised if the UK system did not invoke sovereign immunity in its socialized medicine system -- and there are plenty of horror stories there.    

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by: RichardWard @ Thu Sep 10, 2009 at 09:40:00 AM CDT

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I don't think I need t point out

that David Kessler and Mark McClellan are strong GOP partisans.  

"One person, one vote" died at the hands of SCOTUS, January 21, 2010

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by: KathyinBlacksburg @ Thu Sep 10, 2009 at 13:14:19 PM CDT

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