I’m skeptical about … malpractice reform (part 1).

Responding to a 2009 request from Senator Orrin Hatch (R, Utah), the Congressional Budget Office issued a letter suggesting that medical malpractice tort reform would “reduce federal budget deficits by roughly $54 billion over the next 10 years.” Sounds great—a billion here, a billion there and pretty soon you’re talking real money—but the devil is in the details. The CBO letter reported that 40% of the savings would come in the form of lower malpractice premiums to physicians and 60% from “less utilization of health care services.”

What does that mean, exactly? Insurance companies are only going to lower premiums to physicians if they are paying out fewer and/or smaller settlements to the victims of malpractice. To accomplish this would require placing caps on awards and making it harder to sue. The thinking goes that physicians, once relieved of malpractice fears, would then stop ordering so many unnecessary tests thereby lowering healthcare costs for everyone.


(Credit: Tingey Injury Law Firm, Unsplash: tingey-injury-law-firm-L4YGuSg0fxs-unsplash)


Defensive medicine is defined as the “ordering of treatments, tests, and procedures primarily to help protect the physician from liability rather than to substantially further the patient’s diagnosis or treatment.” And it’s a problem—a big problem. One recent study noted that 93% of physicians in high-risk specialties admit to defensive medicine practices at least some of the time (and the others simply lack self-awareness). Every physician I know practices defensively. Ours is a culture of shame and blame. Physicians have simply responded in kind to protect themselves. Besides, patients are always clamoring for more tests, so where’s the problem in “being careful?” Ignoring the fact that excessive testing often leads to harm rather than benefit, there is the matter of cost. Going well beyond the CBO projections, a 2010 Price/Waterhouse/Coopers study estimated that defensive medicine practices cost the healthcare system $210 billion annually, accounting for 10% of all healthcare costs. The figure is dubious. Nobody really knows how much defensive medicine is costing the system but all agree that it’s a sizable chunk of change. Sizable enough to prompt House Speaker John Boehner (R, Ohio) to state that defensive medicine is the “biggest cost driver” in the American healthcare system. And while I rarely agree with the Speaker about anything, in this case, he just may be right.

But is there any evidence that malpractice reform actually changes the way physicians practice? We need look no further than the great state of Texas for answers. In 2003, the state passed sweeping malpractice reform that not only placed caps on payouts but also made it much harder to sue doctors. Before the legislation, the standard to win a malpractice suit required showing that a physician had deviated from “the standard of customary practice” and that this deviation had resulted in harm to the patient. Texas changed the standard to one requiring “willful and wanton negligence” on the part of the doctor. In Texas, an emergency physician not only has to deviate from customary practice, but also must recognize that this deviation was likely to cause harm and proceed anyway. Under this standard, a patient who accidently had the wrong leg amputated during surgery would not be compensated unless he could prove that the doctor knew it was the wrong leg and cut it off anyway. Anybody want to move to Texas?

Needless to say, the legislation successfully lowered the number of lawsuits by 60% and payouts by 70%. Over the next 7 years, physician malpractice premiums also declined by 50%. But medical insurance premiums paid by patients didn’t. Instead, they rose by more than 50%, at a rate even higher than the national average. Even the Affordable Care Act wasn’t able to help the citizens of Texas much. The state still leads the nation in the percentage of its citizens without healthcare insurance. And there’s no truth to the claim of politicians that malpractice reform led to a huge influx of doctors either. Although many doctors did move to Texas after the reform, roughly an equal number retired or moved away. Instead, the increase in physician population simply mirrored the overall increase in the state’s population as a whole, while the proportion of doctors practicing in physician-shortage areas actually declined a bit. A detailed paper published by the Social Science Research Network clearly shows that Texas was neither “hemorrhaging doctors” before the reform nor achieved an “amazing turnaround” after. The state still has fewer physicians per capita than the rest of the country.

Okay, so malpractice reform didn’t increase the number of insured Texans or increase access to care. But wasn’t the real purpose to reduce medical costs by taking pressure off physicians to order so many unnecessary tests? Certainly that panned out, didn’t it? It did not. For reasons that nobody can adequately explain, Part B Medicare expenditures (e.g. lab tests, doctor visits, and surgeries) markedly increased in Texas after the legislation, and to a far greater degree than the rest of the country. From 2003 to 2007, these expenditures rose nationally by 31% while they increased in Texas by 43%. Strike three, you’re out.

Despite legislation protecting them from lawsuits, physicians in Texas continued ordering tons of tests—even more tests than doctors in places without similar protections. Does this mean ordering more tests and surgeries improves the quality of care? This is a very difficult thing to measure, but if we use the number of complaints filed against physicians as a surrogate for quality then the answer is another no. Once it became almost impossible to sue doctors, patients retaliated in the only manner left to them. Complaints filed to the state Medical Board increased by 13%, investigations by 33%, license revocations by 47%, disciplinary actions by 96%, and financial penalties by 367%. Oops—looks like the doctors of Texas didn’t exactly live up to the promise of providing better care through fewer tests.

To summarize: Malpractice reform in Texas led to a drastic reduction in lawsuits, payouts, and insurance premiums paid by doctors while failing to increase access to care, lower insurance premiums paid by patients, or improve the quality of care delivered. Lastly, the reform failed to save healthcare dollars or reduce Medicare testing. The only winners were the doctors and the insurance companies. The losers were everyone else. What I would call an “epic fail,” Michele Bachmann called “a wonderful job of lawsuit reform.” I guess it just depends on your perspective.

Thirty states now have damage caps in place and there is no evidence that this has done anything to lower healthcare costs or decrease defensive medicine. The three states that have enacted the most drastic reforms—Texas, South Carolina, and Georgia—have seen no change in ER physician practice patterns and have reaped no savings. There are many reasons to change our current malpractice system, but thinking that it will save money by eliminating defensive medicine isn’t one of them.




  1. Douglas W. Elmendorf, Director, Congressional Budget Office, US Congress, Washington, DC, letter to Senator Orrin Hatch, Oct. 9, 2009, cbo.gov.
  2. M. Studdert et al., “Defensive Medicine Among High-Risk Specialist Physicians In a Volatile Malpractice Environment,” JAMA 2005; 293: 2609-17.
  3. Price/Waterhouse/Coopers, “The Price of Excess: Identifying Waste in Healthcare Spending,” 2010, http://www.pwc.com/us/en/healthcarepublications/the-price-of-excess.jhtml.
  4. Taylor Lincoln, “A Failed Experiment: Health Care in Texas Has Worsened in Key Respects Since State Instituted Liability Caps in 2003,” Public Citizen, Oct. 2011, http://www.citizen.org/documents/a-failed-experiment-report.pdf.
  5. “Health Insurance Coverage of the Total Population,” Henry J. Kaiser Family Foundation 2013, http://kff.org/other/state-indicator/total-population/.
  6. David Hyman et al., “Does Tort Reform Affect Physician Supply? Evidence From Texas,” Social Science Research Network 2012, http://ssrn.com/abstract=2047433.
  7. Ronald Stewart et al., “Tort Reform Is Associated With More Medical Board Complaints and Disciplinary Actions,” Am. Coll Surg. 2012; 214: 567-73.
  8. Daniel Waxman et al., “The Effect of Malpractice Reform on Emergency Department Care,” NEJM 2014; 371, n0.16: 1518-25.



2 thoughts on “I’m skeptical about … malpractice reform (part 1).

  1. The results this reform yielded do not really surprise me. Getting sued is serious business and we live in a society that wants something for nothing all while being egged on by the media. Want to get rich? Sue someone! So obviously the lawyers were loving it but the malpractice insurance companies-not so much. Money rules the worlds.

    But really. How often are there these huge pay out lawsuits? I also want to know how many other physicians you know that have been sued. It may be well hidden but I haven’t been able to find much on anyone. So even without this cap, correct me if I am wrong, it seems that suing is not as easy as it once was…

    I can see why this idea was probably easily sold. On the outside it would be of comfort to physicians. If common sense and intuition are warped by fear of a law suit how can any patient be safe? Plus, we can save money by limiting all these extra tests! Sure, a couple people might suffer, but it is the name of the game and it will help the majority-the majority being insurance companies and such. But Isn’t it still bad to have revoked license and other sanctions? I mean at least if a physician has malpractice insurance it might semi-protect them financially.

    So is over-ordering a direct result of the fear of being sued? I am only partially convinced.

    My theory is that the over ordering of tests more than likely originated years ago by physicians to protect from any law suits, duh, but as a result the way medicine is taught has adapted to this style. I rarely hear physicians say “I am only doing this so I don’t get sued.” While I am not naïve and do believe that it is something ingrained in the back of our heads, I do not believe that most of the doctors I actually respect practice the way they do for the sole reason of not getting sued. I would like to think that most of these doctors practice the way they do in order to diagnose and treat patients and not just to make money and prevent losing all that money. Whether it be because they are humanitarians and want to end suffering (maybe we all start out like this but it is easy to get jaded!) or whether it is that they enjoy solving the mystery and perfecting their craft and they are slightly hardened to society. Either way, they do not appear to be consumed with worries of litigation, even though it is probably in the back of everyone’s mind. In my own experience I find that these things are ordered because it is the expectation and old ways of diagnosing seem to be out the window.

    So anyway, these people go to medical school and are taught that this is the current Standard of Practice/Care and if it is not done then you will be sued. Even in nursing school they beat it into our brains- “If it is not documented it is not done and you will be sued for negligence” and “if you give that med, even if the doctor ordered it, you are responsible and if it goes wrong you will be sued.” Even though when asked, no one can tell me of a specific even they know of personally. I know that doesn’t mean it isn’t a risk, but it seems like overkill at times.

    So the seasoned physicians who are now teaching the “newbies” enforce this defensive medicine. It seems that hands are tied. When a patient comes in once or twice a week for “kidney stone” or some other mysterious, unsolvable abdominal pain, a CT scan will likely be ordered. Common sense along with the fact that the other 10 CT scans they have had in the last year show nothing abnormal-well maybe constipation from the pain meds. Obviously, that is uncomfortable so instead of critically thinking about the situation and seeing that the X-ray shows constipation. It does not matter than a CT scan was done 7 days ago, it is taught to keep looking until something is found.

    It seems to me that if someone were to get cancer they could be like “oh it was So and So Hospitals fault. They ordered all these scans and they owe me money for pain and suffering”

    Patient satisfaction scores are of utmost importance. We really do care about the patients so we want them to be well radiated and addicted to dilaudid. That way they keep coming back to benefit the hospital, drug company, private insurance or whatever else there may be. I have a theory that “diseases” that have no abnormal test results, not abnormal anything were created to pacify these people and make it ok to get them hooked on narcotics or benzos. That way when they stop taking them they really will have a problem.

    So the cap appears smart and it seems to have the physicians best interest in mind and I am sure the patients are told “with less people waiting on test results in the ER, you will be seen sooner and get the best pain meds to help that cough you have had for two hours! “ Or so They say. If someone could tell me the credentials and who They are I would be a little happier.
    Maybe in theory this reform could potentially eliminate the patients who don’t really need to be seen for these “emergent tests.” Kind of like welfare, it sounds good on paper and it probably has helped a few but it has really deviated from its original goal.

    Once word gets out that CT scans are no longer readily available people will stop coming for petty things. That would be an assumption based on whether the general public was up to date on such things and that they were there simply to rule out some life threatening medical problem instead of going through the motions to get their Percocet refilled.

    So the Cap is initiated, less test WILL be ordered and the Hospitals will be the opportunist they can be. They already push customer, I mean patient satisfaction to somehow make money. Now, it would become easier for these CEO ran hospitals (with no medical training) to put guidelines on who gets which test and when. We all know this can prevent a lot of unnecessary costs, but what about the patient who really should have a CT but doesn’t quite meet guidelines. Will this cause the doctor intuition to be a thing of the past? If the boxes aren’t checked accordingly then it’s a no go. Maybe this is extreme, but I bet people 50 years ago didn’t think that a drug comparable to heroin was necessary for mild to moderate pain. Don’t get me wrong, if someone really needs something that strong for pain I doubt anyone would withhold it. But that is another topic all together. My point is that anything is possible and I think watching the world around us is enough proof.

    In my years as a RN I have been witness to some borderline ridiculous decisions made by some physicians who probably should have been sued, in one case for a lot. I, personally, have noticed a commonality between all the hearings I attended. Basically it was not the physician withholding tests or not ordering enough or anything to do with actual medicine. Surprisingly, that was not the meat and potatoes of why the physician was being investigated. In all the hearings I attended the theme seemed to be as simple as a crappy personality. Even though some mistake had been made, that seemed to be trivial in respect to the physician’s bedside manner as well as how the physician interacted with other healthcare workers.
    I have worked as an RN in multiple ERs alongside MANY different doctors over the last few years and I have forged friendships (or at least “work” friendships) with many of these doctors, while others have been strictly professional. Strictly professional in the sense that the only communication we had was to take care of a patient. In fact, at one place I worked someone had the bright idea to eliminate ANY form of verbal communication by creating a way to message a physician with your concern/question. Almost like a text message via computer. If some of these doctors were approached they would tell you to send it in a message. There was no real interaction thus no working relationship.

    The way these doctors associated, or didn’t in some cases, with those he worked with spilled into patient care. The nurses, being only human, had little to go on to help encourage the patient and patients family that they were in good hands. They also overheard the exchanges between the physician and co-workers and it was rarely positive in the cases brought to light.
    Making a fatal error and getting sued is a very real risk, especially in critical settings, such as an Emergency Department. As we both know, it can get very stressful and resources are stretched to the max. This births an environment where mistakes, sometimes fatal, can easily be made and it is important to know the people you are going to be working so closely with. It is so important that you at least have some sort of grasp on whether the individual can be trusted to use their head or whether you would be better off talking to a wall. It is critical that we understand each other strengths and weaknesses and the only way to do that is to get to know someone on some level. Very rarely do people come out and say “Hey I am an idiot who can’t handle anything, especially if it is not the way the book says it should.” So really, looking up from the computer from time to time to acknowledge the people around you can really save you. That is if you are the type to have to force any interaction. Honesty, for those types, they are ticking time bombs and they should be happy they can only get sued for so much.

    Everything is so out of control and no one is safe really. I would say that when you try to make people feel better and it comes from the heart you are protected. But that is not true. I am living proof of that and no one is safe. You know what my advice would be? Trust no one but surround yourself with people who have the potential to be trusted and wait and see. Be nice to everyone and when it comes to narcotics you are damned if you do and damned if you don’t!

    Basically treat others how you want to be treated. It is the Golden Rule for a reason!

    • Llana, you make some excellent points. Since the introduction of caps both the number of lawsuits and the amount of the payouts has indeed gone down. The most recent data I could find shows that, in 2012, malpractice payouts were the lowest on record representing a mere 0.11% of national healthcare costs. So the argument for urgent tort reform seems overstated and self-serving.

      One point I would like to stress is that doctors practice defensively without consciously acknowledging that they are doing so. The emphasis on “being careful” is so ingrained into physicians that test ordering is second nature and done without a lot of conscious thought. The introduction of EMRs only fosters this by making it incredibly easy to order a host of tests with the simple click of a mouse. Tort reform is unlikely to change this, as current data clearly shows. This does not mean that tort reform isn’t necessary. The reason we need tort reform is not because that it will reduce defensive medicine, but rather because the current system fails to serve the patient!

      In the meantime, the best way to for doctors and nurses to prevent harm is through the practice of “mindfulness” (paying attention to the present, the common, and the ordinary), an increasingly difficult task given the frequent interruptions, onerous charting requirements, and ever increasing demands to “do more with less.”

Leave a Reply

Your email address will not be published. Required fields are marked *