Obama Open to Reining in Medical Suits
By SHERYL GAY STOLBERG and ROBERT PEAR

WASHINGTON — The American Medical Association has long battled Democrats who oppose protecting doctors from malpractice lawsuits. But during a private meeting at the White House last month, association officials said, they found one Democrat willing to entertain the idea: President Obama.

In closed-door talks, Mr. Obama has been making the case that reducing malpractice lawsuits — a goal of many doctors and Republicans — can help drive down health care costs, and should be considered as part of any health care overhaul, according to lawmakers of both parties, as well as A.M.A. officials.

It is a position that could hurt Mr. Obama with the left wing of his party and with trial lawyers who are major donors to Democratic campaigns. But one Democrat close to the president said Mr. Obama, who wants health legislation to have broad support, views addressing medical liability issues as a “credibility builder” — in effect, a bargaining chip that might keep doctors and, more important, Republicans, at the negotiating table.

Seriously, though…this should have come out of Friday, the traditional day for releasing avoidable stupidity. Because I HATE having to pull all this together at 6 AM.

Malpractice Costs Up 150% Since 1999, Hospitals Say
By THOMAS J. LUECK

The cost of medical malpractice insurance in New York City, Westchester County and on Long Island has risen by nearly 150 percent since 1999, creating severe financial strains that have limited patients’ access to such specialties as obstetrics and gynecology and made New York a "crisis state" for doctors, according to a report released yesterday by a hospital trade group.

The trade group, the Greater New York Hospital Association, which represents medical institutions in New York, New Jersey, Connecticut and Rhode Island, said its analysis had focused on 34 hospitals in and around New York City. On average, it said, the hospitals have been billed for malpractice premium increases of 27 percent a year for five years.

"The increasing cost of malpractice insurance has become a pressing burden for New York’s financially fragile hospitals," said Kenneth E. Raske, the association’s president.

Now, here’s the thing.

We need to remember the economic rationale behind law suits. You sue when someone fails and the cost of their failure doesn’t fall on them. A law suit shifts the burden to the responsible party. Punitive damages is for egregious failure, avoidable failure or intentional failure.

Now, how do you set a limit on the cost of failure before the failure occurs? How to you even set a value on the damage cause by, say, a child dying of brain damage?

There are cases that are purely punitive, and should be. Humans being human, of course, you have folks trying to game the system and I suppose folks feel limiting the amount to can receive in any settlement removes an economic incentive to do so. But if you’re actually concerned about health care rather than people who didn’t deliver the health care properly, the incentives are applied in the wrong place.

Since 2000, the number of insurers providing malpractice insurance to New York area hospitals has fallen to four from six, the association said. It said the New York insurers, compared with those in other states, had had some of the worst financial results, paying out $1.44 in claims for each dollar collected in premiums. And it said many of the nation’s largest malpractice awards, some exceeding $90 million, had occurred in New York City. Although such awards are routinely reduced before the cases are settled, the study listed huge settlements reached in recent years, including one for $50.1 million in Manhattan in 2002 and another for $10.6 million in Brooklyn in 2000.

If there’s so many failures you can’t afford to pay for them, you can pay less…or fail less. Insurance companies advertise about programs to improve your driving or fire safety you can implement in exchange for lower insurance rates. Why not do the same thing for hospitals? Give them the incentives to eliminate the factors that cause error (primary of which, in NYC anyway, is a critical understaffing of hospitals…talk to the union reps, they’ll have the figures at their fingertips). That way we get lower premiums AND better health care.

And that is what we want, right?