Malpractice reform is a small price to pay for health care reform.

How to fix health policy.
Sept. 9 2009 11:01 PM

One Reform for Another

Obama should follow through on his malpractice concession.

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Barack Obama. Click image to expand.
President Obama

Before President Obama's big speech tonight on health care, even liberal commentator Michael Tomasky was urging him to drop the public option because "it just doesn't have the votes in the Senate." (In fact, it's probably only six votes shy.) Instead, Obama offered up a different concession: malpractice reform. He chose well.

As Ezra Klein has previously noted in Slate, the evidence is weak that there's a malpractice crisis in America. One Harvard study found that doctors injured 4 percent of their patients, and only 4 percent of them bothered to sue. Real average jury awards have remained flat. Malpractice premiums are not the burden doctors claim they are: In inflation-adjusted dollars, they were lower in 2000 than they were in 1986.

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Even so, insurers' fears of being hit with an astronomical jury award are legitimate. The risk may be remote, but the potential loss is frightening. The health reform bills that have cleared four committees in the House and Senate don't address this problem because Congress doesn't want to anger lawyers, who give three times as much to Democrats as they do to Republicans.

Obama has repeatedly stated that he'd be open to malpractice reform, but he's never followed through. In his June 15 speech to the American Medical Association, Obama said: "I recognize that it will be hard to make some of these changes if doctors feel like they're constantly looking over their shoulders for fear of lawsuits. … I understand some doctors may feel the need to order more tests and treatments to avoid being legally vulnerable. That's a real issue." But conservatives pounced on what he said next: "I'm not advocating caps on malpractice awards—which I personally believe can be unfair to people who've been wrongfully harmed."

In his speech before Congress, Obama sounded a bit more conciliatory:

I don't believe malpractice reform is a silver bullet, but I have talked to enough doctors to know that defensive medicine may be contributing to unnecessary costs. So I am proposing that we move forward on a range of ideas about how to put patient safety first and let doctors focus on practicing medicine. I know that the Bush administration considered authorizing demonstration projects in individual states to test these issues. It's a good idea, and I am directing my secretary of health and human services to move forward on this initiative today. 

President Bush favored capping noneconomic malpractice damages at $ 250,000. Obama stopped short of endorsing that. If $250,000 strikes him as too low, how about $750,000? That's a decent opening bid in a negotiation with the GOP. If some Republican senator agrees to haggle, Obama should be prepared to drop to $500,000. If several Republicans agree to haggle, Obama should consider dropping all the way down to $250,000. Under the health reform that Obama is trying to achieve, it should no longer be necessary to win a litigation lottery to get your medical bills paid.

Timothy Noah is a former Slate staffer. His  book about income inequality is The Great Divergence.