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Gingrey: Lawsuits Handcuffing Health Care

Awards From Liability Suits Shouldn’t Be Used as Investments for Hedge Funds

It is a well-known fact that a strong doctor-patient relationship is an important part of an effective health care system.

What is less known, however, is that this relationship is in serious peril because of increasing attempts by some trial attorneys and Wall Street to exploit medical malpractice cases in search of large profits.

In the past few years, hedge funds and investment firms have begun capitalizing on medical lawsuits in order to reap rewards that are actually intended for injured patients. Furthermore, many of these suits aren’t even based on legitimate claims and oftentimes it is the patient’s own attorney who is responsible for facilitating these deals.

This is an alarming and costly problem. The New York Times reported that in this year alone, the financing of these types of frivolous suits will cost nearly $1 billion, adding a large amount of wasteful spending to our already ailing health care system. Health care liability awards should not be used as an investment vehicle for law firms and hedge funds, but should be used to make the patient whole.

When the well-being of patients is no longer the first priority, the need for tort reform becomes more important than ever. Support for meaningful medical malpractice liability reform can be traced back 30 years, to when then-Gov. Jerry Brown (D) of California implemented tort reform laws to address this very problem. The results were significant. The state saw an improvement in the care of patients and their safety, more accessibility to care, growth in the industry and lower costs.

The need for reform is still being echoed today, but on a national level. Most recently, we heard President Barack Obama during his State of the Union address talk about the need to look at alternate ways to lower the cost of health care, including medical liability reform. What may have been traditionally thought of as a political issue is now clearly an initiative with widespread bipartisan support.

This support gives us the ability to answer the call for reform by implementing meaningful liability solutions on a much larger scale. To do so, I introduced H.R. 5, the Help Efficient, Accessible, Low-cost, Timely Healthcare Act, along with my co-sponsors, House Judiciary Chairman Lamar Smith (R-Texas) and Rep. David Scott (D-Ga.). Our bill parallels the successful reforms in California and would ensure that injured patients can be made whole while creating substantial savings for our health care system.

And the savings that these reforms would bring about are quite significant. Meaningful medical liability reform has the potential to dramatically reduce the cost of health care by as much as
$200 billion annually. Currently, this money is being lost to the practice of defensive medicine, frivolous lawsuits and excessive fees instead of being used to compensate injured patients. In a time when each and every dollar that we spend counts, these savings could make a huge difference in the quality of health care provided.

This cost ultimately increases insurance rates and creates a less desirable environment for physicians to practice medicine. In fact, the rising cost of medical malpractice insurance has been the main reason cited by medical students for deciding not to practice, which is a contributing factor to our national physician shortage.

Lack of reform not only increases the costs of health care significantly, but it directly strains the doctor-patient relationship. When medical liability cases becomes less about the quality of care and more about outside parties earning dividends on patient injury awards, the need for reform is clear. After all, it should be easier to see your doctor than to sue your doctor.

Maintaining the status quo in our health care system is no longer acceptable. Big, expensive and intrusive bills are not the kinds of solutions the American people want. But by supporting reforms such as the HEALTH Act, we can enact cost-cutting and meaningful measures that truly turn our focus back to the care and protection of patients nationwide.

Rep. Phil Gingrey (R-Ga.) is a member of the House Energy and Commerce Committee and its Subcommittee on Health. He co-chairs the GOP Doctors Caucus.

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