Tort reform opponents knock ‘defensive medicine’ argument

The defensive medicine argument took on new prominence during the healthcare reform debate when the Congressional Budget Office estimated that medical malpractice reform proposals could reduce national health spending by about .5 percent. Two-fifths of that was attributed to lower medical liability premiums, and three-fifths to “slightly less utilization of health care systems.”

In a Dec. 10, 2009, letter to Sen. Jay Rockefeller (D-W.Va.), CBO wrote that tort reforms would probably have a bigger impact on Medicare than on privately funded healthcare because private insurance plans are more likely to manage care.

“Such plans may limit the use of services that have marginal benefit to patients to a greater degree than does Medicare,” CBO wrote, “leaving less room for changes in pressures regarding malpractice to affect utilization.”

Hyde’s article turns that analysis on its head: He argues that Democrats’ healthcare reform law, by shifting away from Medicare reimbursements for each procedure towards payments for episodes of care, risks promoting healthcare rationing if the threat of lawsuits is curtailed.

“Health care reform may change financial incentives toward doing fewer rather than more tests and procedures,” Hyde writes. “If that happens, concerns about malpractice liability may act to check potential tendencies to provide too few services.”