Tort reform proposals are the spectre that haunts the legal industry: like a horror-movie monster, if we relax our guard it is certain to rise again. Whether the context is debate on newly-enacted healthcare legislation, concerns about the trial bar’s influence in politics, or even lectures on the moral decay of society, it seems that someone is always pointing a finger at plaintiffs and their attorneys. If only we could enact comprehensive tort reform, they say, then things would be different: healthcare costs would plummet, “junk lawsuits” would dissipate, a better life for all. The Illinois personal injury attorneys of Passen Law Group have always believed that that proponents of tort reform — namely, the insurance lobby and Corporate America — had it wrong.
Now, we have proof.
The argument usually advanced by proponents of tort reform sounds like this: with tort reform, there will be fewer personal injury and medical malpractice lawsuits, particularly meritless lawsuits. If doctors, hospitals, and other healthcare providers don’t have to plan for the defense of “junk” lawsuits, then they won’t need to practice so-called “defensive medicine” – tests and procedures that are not truly warranted or necessary, but are performed merely to avoid a lawsuit. Malpractice premiums will also drop. So goes the theory, anyway.
Although the new federal healthcare bill thankfully does not include tort reform, many states have enacted tort reform laws of varying severity. Ohio is one such state: tort reform cleared the legislature in Columbus five years ago. Five years later, Ohio’s healthcare costs, however, have increased.
Ohio’s tort reform package included draconian restrictions on the rights of plaintiffs to access the civil justice system: arbitrary cap on jury damages ($250,000 except in catastrophic cases), restrictions on punitive damages, and other measures designed to make it more difficult to take medical malpractice claims to trial. The Chicago personal injury attorneys at Passen Law Group strongly oppose such measures, as they unreasonably restrict the ability of the victims of medical negligence to recover all of the loss they have suffered. Indeed, such restrictions can often prevent victims from recovering even the out-of-pocket costs they incur due to the negligence of others.
While tort-reform advocates argue that such measures are justified because they will reduce healthcare costs, costs in Ohio still climbed. In the first four years since these unreasonable measures were imposed, the average cost of an employer-based family health insurance plans rose by about $2,000, or 19%. While some might argue that costs would inevitably have risen even more had these measures not been in place, this assertion is also belied by the facts. The average national increase over that same time period was 22% – virtually indistinguishable. Indeed, Ohio’s average cost increase was greater than that in Kentucky (which borders Ohio), a state that did not enact tort reform.
Nor is the result in Ohio an anomaly. When the costs of providing medicare are analyzed (providing a fairly reliable indicator of localized healthcare costs), costs appear to have little if any connection to tort reform. For instance, Texas has enacted tort reform measures very similar to those in Ohio. But Texas cities still have some of the highest average per person healthcare expenditures in the nation.
Since the passage of tort reform legislation, malpractice insurance premiums in Ohio have decreased slightly. But economists believe that this decrease was because premiums were previously arbitrarily inflated, due to a decline in the stock market and insurers’ corresponding need to shore up reserves, just before Ohio’s new laws were enacted. Thus, the drop in premiums was purely artificial. But whether the drop in premiums was at all connected to the legislation or not, the fact remains that none of these savings was passed along to the people of Ohio. As a society we must ask ourselves: Should we enact laws to protect the powerful insurance lobby and their astronomical profits, at the expense of denying the victims of the medical negligence the opportunity to have their voices heard and to receive fair and reasonable compensation determined by a jury of their peers? The Chicago medical malpractice attorneys of Passen Law Group believe the answer is clear.
For a free consultation with an experienced Illinois personal injury lawyer at Passen Law Group, call us at (312) 527-4500.