New Public Citizen Report on tort reform in Texas

Last month I reported on a new study on tort reform in Texas by Texas Watch.  See here.  Now, consumer protection organization Public Citizen has released a report on the failure of a $250,000 medical malpractice cap in Texas to lower health care costs. Here is the abstract of the report:

A common perception among policymakers and pundits is that medical malpractice litigation is significantly, or even chiefly, to blame for skyrocketing health care costs and steadily diminishing access to care. But analysis of data in Texas, which in 2003 imposed some of the strictest liability caps in the country, tells a far different story. While litigation over malpractice in Texas has plummeted dramatically since the caps were imposed, residents of Texas (except for people with financial connections to liability insurance companies and, to a lesser extent, doctors) have realized few, if any, benefits. Instead, the health care picture in Texas has worsened significantly by almost any measure.

You can read the full report here.  For some comments on the report go here and here.

Here are some of the findings:

-- The cap did not prevent increases in health care costs.

-- Since 2003, Medicare costs rose 13% faster than the national average.

-- Health insurance costs have outpaced the national average and the percentage of residents lacking health insurance has risen.

-- Medicare spending specifically for outpatient service has risen 30.7 percent faster than the national average;

-- Medicare diagnostic testing expenditure have risen 25.6 percent faster than the national average;

-- Premiums for private health insurance have risen faster (51.7 percent) than the national average (50 percent);

-- The percentage of Texans who lack health insurance has risen to 24.6 percent, solidifying the state’s dubious distinction of having the highest uninsured rate in the country;

-- The per capita number of primary care physicians practicing in Texas has remained flat, compared to a sharp increase in the years leading up to the cap; and

-- The prevalence of physicians in non-metropolitan areas has declined.

These last two findings are interesting given that a typical argument for tort reform is that we need tort reform to avoid doctors leaving practice or moving to other states.

The one thing the cap resulted in was fewer lawsuits.  This is an obvious consequence of tort reform.  As I have stated before (see here, for example), if you make it more difficult for injured victims to sue (or recover) there will be fewer lawsuits.  We don't need a special study for that.  All that shows is the real goal of tort law: to make it more difficult for injured victims to get compensation for their injuries and to allow those who cause their injuries to avoid liability.

A lot of people think this is a good idea until they (or someone close to them) suffers an injury. They often change their opinion once they realize the real consequences of tort reform.  See here and  here for example.