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Washington Examiner
June 17, 2005

Putting a lid on D.C.'s malpractice

The Americans are not there. They're not in Baghdad. There are no troops there. Never. They're not at all.

— "Baghdad Bob," April 7, 2003]

D.C. Mayor Anthony Williams deserves credit for introducing the Health Care Reform Act of 2005 last month. It's an overdue attempt to control the District's soaring malpractice insurance rates.

His bill would cap non-economic awards in malpractice lawsuits, one of the main drivers of insurance rates. Obstetricians in D.C. now pay an average of more than $139,000 a year; that's projected to rise to more than $235,000 in five years if reforms aren't enacted. At least 60 obstetricians stopped practicing in the District during the last two years.

The trial lawyers, of course, instantly closed ranks against the mayor's proposal. Wayne "Baghdad Bob" Cohen, president of the Trial Lawyers Association of D.C., brayed their standard and ridiculous mantra: "There is no relationship," he declared in the association's newsletter, "between caps on jury awards and insurance rates."

Oh? Maybe Cohen hasn't heard of California's Medical Injury Compensation Reform Act. MICRA was enacted in 1975 to cool a similar malpractice insurance meltdown. Like Mayor Williams' proposal, MICRA caps non-economic damages at $250,000, with no limit on awards for medical bills, lost wages, and the like.

What effect has MICRA had on insurance premiums over these 30 years? A 2003 study by the Department of Health and Human Services found that "insurance premiums in California have risen by 167 percent over this period while those in the rest of the country have increased 505 percent."

HHS more broadly concluded that "there is a substantial difference in the level of medical malpractice premiums in states with meaningful caps and states without meaningful caps."

So much for "no relationship between caps and insurance rates." Maybe the trial lawyers should switch to the Homer Simpson defense: "Facts are meaningless. You could use facts to prove anything that's even remotely true!"

If you want to know what's in store for D.C. health care without reforms, take a look at a few states where trial lawyers have prevailed. A few findings from a 2003 report by the congressional Joint Economic Committee:

Florida: The number of malpractice insurers dropped from 40 to 20 over the past decade, pushing premiums up. Premiums in 2002 averaged $201,376 for obstetricians.

New Jersey: Premiums have been rising by 20 to 25 percent annually, and the Medical Society of New Jersey estimates that 3,000 physicians risk losing coverage because of reduced coverage by insurers. In less than one year, three insurers covering 55 percent of the state's doctors stopped writing policies.

Pennsylvania: The state's largest malpractice insurer has been placed in liquidation, and two others have stopped writing new policies. Rising insurance costs have induced doctors to leave the state, retire early or stop performing certain procedures. The loss of radiologists has caused waiting periods of up to eight months for routine mammograms.

West Virginia: High malpractice rates have driven about 5 percent of the state's doctors out of state or into early retirement. After the last emergency room neurosurgeon left Wheeling, trauma patients had to taken by helicopter to other emergency rooms. The departure of the St. Paul Insurance Companies has forced two-thirds of the state's doctors to seek coverage from other sources.

We could go on, but the story is pretty much the same wherever juries are allowed to bestow unlimited awards for non-economic damages: insurance rates rise, medical bills rise, doctors restrict or abandon their practices, and medical care deteriorates.

Those are facts. Why do trial lawyers stubbornly deny them? You might find a hint in this fact from a study of MICRA by the RAND Institute for Civil Justice: "Because of the law's combination of award caps and limits on maximum contingency percentages, attorneys lost 60 percent of the fees they would have made from these plaintiff victories without MICRA."