Medical malpractice reform savings would be small, report says

Medical malpractice reform is unlikely to cut healthcare spending significantly, the Congressional Budget Office reported Friday.

Enacting a cap on pain-and-suffering and punitive damages, changing liability laws and tightening the statute of limitations on malpractice claims would lower total healthcare spending by about one-half of 1% each year -- $11 billion at the current level -- according to an estimate by the nonpartisan agency.

The figure is far lower than previous estimates by groups backing malpractice reform. On Sunday, Sen. Jon Kyl (R-Ariz.) blasted Democrats for blocking attempts to reform malpractice laws. “Almost everybody agrees that we can save between $100 billion and $200 billion if we had effective medical malpractice reform,” he said.

Reform advocates cast the report as an endorsement of their efforts, noting that the government would save $41 billion over 10 years on such programs as Medicare and Medicaid.

“These numbers show that this problem deserves more than lip service from policymakers,” Sen. Orrin G. Hatch (R-Utah), who requested the analysis, said in a statement.

Lisa Rickard, president of the U.S. Chamber of Commerce’s Institute for Legal Reform, called the analysis “momentous.”

“Today’s CBO analysis should underscore what two-thirds of voters have said: Congress should include meaningful medical liability reform in the healthcare reform bill,” she said.

This is the first Congressional Budget Office report to put a price tag on so-called defensive medicine, procedures and tests that stave off the threat of lawsuits but may not improve patient health. The agency found that reducing those measures through malpractice reform would lower healthcare spending by three-tenths of 1%.

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alex.hart@latimes.com