Rep. Issa: Was Obama ‘Just Lying to Congress’ on Tort Reform Pledge?

By Fred Lucas | February 8, 2010 | 6:03 PM EST

President Barack Obama delivers a statement on his budget that he sent to Congress, Monday, Feb. 1, 2010, in the Grand Foyer of the White House in Washington. (AP Photo/Pablo Martinez Monsivais)

( – In September, President Barack Obama told a joint session of Congress that his administration would look into tort reform as a means of lowering health care costs, but the administration’s Department of Health and Human Services stated in congressional staff report that medical malpractice reform is “not a priority.” 

As congressional Republicans prepare for a Feb. 25 meeting with Obama, Rep. Darrell Issa (R-Calif.) wonders if Obama was lying.

Issa is the ranking member of the House Oversight and Government Reform Committee, which released a study last week showing that tort reform – such as capping non-economic damages – could save as much as $210 billion per year in medical costs. The report showed the impact lawsuits are having on doctors – particularly OBGYNs – and also how capping rewards have reduced medical costs in California, Texas and Georgia.

In his September speech, Obama said, “Now, I don't believe malpractice reform is a silver bullet, but I've talked to enough doctors to know that defensive medicine may be contributing to unnecessary costs.”

“So I'm proposing that we move forward on a range of ideas about how to put patient safety first and let doctors focus on practicing medicine,” the president said. “I know that the Bush administration considered authorizing demonstration projects in individual states to test these ideas. I think it's a good idea, and I'm directing my Secretary of Health and Human Services to move forward on this initiative today.”

The Oversight report says, “Committee staff inquired of HHS whether they had an updated figure, but staff was told by personal of the Office of the Assistant Secretary for Planning and Evaluation that the report in question involved medical litigation which ‘is not a priority with the administration.’”

Issa knows what he wants to ask the president at the Feb. 25 bipartisan conference.

“The first question I have for President Obama is if he still stands by his call for tort reform or was he just lying to Congress when he directed Secretary [Kathleen] Sebelius to pursue an initiative addressing the costs of defensive medicine,” Issa said in a statement Monday.

“When HHS is telling me that malpractice reform is not a ‘priority of this administration,’ I have to question the sincerity of the President’s commitment to working with congressional Republicans on a bipartisan basis,” Issa continued.
“A clarification from the administration would tell us if he is sincere in his effort for bipartisan discussions or if this is just another exercise in futility aimed to make the American people think the White House is serious about bipartisanship.”

In 2003, HHS found the federal government spends between $33.7 billion and $56.2 billion annually for malpractice coverage and defensive medicine. The HHS study said “reasonable limits on non-economic damages would reduce the amount of taxpayers’ money the federal government spends by $28.1-$50.6 billion per year.”

Health care spending consumes 17 percent of the economy, or about $2.5 trillion, and is projected to reach $4.7 trillion by 2019. The committee report contends that putting some restraints on medical malpractice lawsuits will reign in medical costs.

“It is estimated that these additional liability-based medical care costs adds at least 3.4 million
Americans to the rolls of the uninsured,” the report said, citing data from the Pacific Research Institute.
Further, the higher malpractice awards were in a state, the higher the Medicare spending was in a state, the report said, citing a study in the May-June 2007 issue of the journal Health Affairs.

The report cited three states that saw significant reduction in medical costs after passing liability caps.
In California – where awards were capped at $250,000 in 1975, premiums for doctors are as much as 50 percent lower compared with other states. In one example, OBGYNs pay a high of $89,953 per year in California compared to $214,893 per year for medical malpractice in Florida.

Texas enacted reforms in 2003. Medical malpractice rates for doctors have dropped by 50 percent, after a $250,000 non-economic award cap was implemented, and the average award in a lawsuit dropped from $1.2 million to $880,000.

Georgia – which also imposed a $250,000 cap in 2005 – had a 39 percent decrease in medical lawsuits and insurance for doctors decreased by 18 percent.

A 2005 survey by the American Medical Association found that 93 percent of doctors said they practice defensive medicines, while 92 percent said they have made unnecessary referrals to specialists or ordered unnecessary tests to avoid lawsuits.

A 2007 AMA study found that 60 percent of malpractices cases are dropped, but these cases cost an average of $18,000 to defend. Meanwhile, since 2000, the median award for a malpractice case has been $1 million or more.

Internal medicine premiums in states with caps on awards were 17.3 percent lower, according to a study by the research firm Kilgore, Morrisey and Nelson. For OBGYNs – among the hardest hit specialties – premiums were 25 percent.

More than two-thirds of OBGYNs were “forced to alter their practice in some way” because of a lack of affordable malpractice insurance, according to a 2006 report by the American College of Obstetricians and Gynecologists. Further, 90 percent of OBGYNs have been sued, according to the group.