Curb Malpractice Suits to Fix ‘Badly Broken’ System, Bush Says

President Bush said Thursday that stringent new limits on medical malpractice lawsuits would yield tens of billions of dollars in savings that could lower insurance premiums across the board, help senior citizens buy prescription drugs and extend health coverage to millions of uninsured Americans.

Calling on Congress to enact limits already in place in California, Bush cited a “badly broken malpractice system” as a major reason for increasing health-care costs.

“It’s a national problem that requires a national solution,” Bush said here.

But consumer activist groups, trial lawyers and their Democratic allies in Congress took strong exception to Bush’s claims, with some accusing him of stressing the malpractice litigation issue as a ploy to divert attention from his lack of success in producing more far-reaching health-care reforms.

“People who are injured ought to be able to take their case to court--no question about it,” Bush said in a speech at High Point University to 1,700 doctors, nurses and other health-care workers and administrators. “But we’ve got to understand that frivolous lawsuits clog our courts and deny people with legitimate claims.”

Bush said California’s “reasonable” malpractice limits have kept costs relatively low and have led to more affordable, more available and safer care for the state’s residents--a claim some analysts disputed.

Legal experts said it would be difficult to calculate the health-care savings attributable to California’s damage caps and then to extrapolate from them nationally. Each state has a different set of laws, and no one can say with authority how lawsuits would have been resolved if the limits were not in place.

“I certainly wouldn’t venture a dollar amount, let alone a projection nationally, as to what it would save,” Stanford University law professor Robert Rabin said. “Those savings obviously come at a cost in terms of cases that are brought, some of which would be legitimate claims for negligence on the part of doctors.”

According to data for 2000 from the National Assn. of Insurance Commissioners, insurers spent a smaller percentage of premiums collected--45.8%--in California to pay claims against medical providers than the national average of 80.9%.

“There’s no question that jury awards and therefore settlements in California are less than they would have been under the old common-law rules on damages because of the restrictions,” UC Berkeley law professor Stephen Sugarman said.

To buttress Bush’s message, Senate Republicans had planned Thursday to introduce an amendment limiting medical malpractice lawsuits. But Democratic leaders hoped to manage the floor schedule in such a way as to block the amendment or at least to delay a vote on the measure.

In his remarks, Bush displayed unusual gusto as he denounced trial lawyers, blaming them for “junk lawsuits” that he said have forced up costs and driven doctors out of the profession.

The president’s assertions brought a swift response from Democrats, led by Sen. John Edwards (D-N.C.), who made his fortune in North Carolina as a personal injury attorney. His cases included some high-profile medical malpractice lawsuits, one of which was cited by a Department of Health and Human Services study on malpractice litigation released Wednesday.

In a conference call with reporters, Edwards--a possible opponent for Bush in 2004--said the president’s speech “makes no sense to me at all,” stating that malpractice litigation accounts for “significantly less than 1%” of overall health-care costs.

Therefore, Edwards said, the projected savings that Bush claimed will not materialize.

He said the president’s advocacy of malpractice reform “fits a pattern with an administration when it comes to the interests of regular people competing with the interests of big corporations, insurance companies, HMOs and energy companies.”

In recent years, soaring malpractice insurance premiums have prompted physicians and other health-care providers in many parts of the country to drastically reduce their practices or to discontinue them altogether.

Thus Bush endorsed legislation proposed by Rep. James C. Greenwood (R-Pa.) to limit the number of years that a plaintiff has to file a lawsuit; allocate damages in proportion to a party’s degree of culpability; impose a $250,000 cap on noneconomic damages; and limit punitive damages to $250,000 or twice the amount of economic damages, whichever is greater.

Bush also endorsed principles that included provisions to allow medical providers to pay judgments in installments rather than in lump sums, and to require that juries be informed if a plaintiff has other potential sources of reimbursement for an injury. The president said he favors unlimited compensation for economic damages, such as lost wages.

Bush also demanded legal protections for “patient safety and quality improvement” programs designed to encourage physicians and other providers to share information about problems, errors and “near-misses” as a way to prevent future errors.

These “good faith” efforts now are ineffective because of the widespread fear among doctors that such discussions can become the basis of lawsuits, Bush said.

The HHS report released Wednesday said that malpractice insurance premiums are more than three times lower in states that impose caps on noneconomic damages, such as California and Florida, than in states that do not. Noneconomic damages include such intangible items as “pain and suffering” and “loss of companionship.”

If applied nationally, such limits could save $60 billion to $110 billion a year; that money could be used for prescription drug coverage, for bolstering Medicare and Medicaid and for providing health insurance to more than 2 million uninsured Americans, the HHS study stated.

Democrats and consumer groups questioned Bush’s claim that such huge savings could accrue from cracking down on malpractice suits. According to a study by the Consumer Federation of America, medical malpractice premiums represent only 0.55% of total health-care costs.

“It’s completely bogus,” said Joanne Doroshow, executive director of the Center for Justice and Democracy, a national consumer group based in New York. “This is a very cruel and misdirected proposal that will only make rich insurance companies richer than they already are.”

Bush said in his remarks that malpractice reform can save the federal government $25 billion in spending for programs such as Medicare and Medicaid, and programs for veterans and soldiers.

Some health-care activists criticized Bush for focusing on an emerging problem that nevertheless is dwarfed by such needs as prescription drug coverage for senior citizens or insurance for the more than 40 million Americans who have no coverage.

“The president is trying to divert attention because he has produced virtually nothing on health care,” said Ron Pollack, head of Families USA, which advocates universal coverage.

“He’s diverting attention to a low-priority matter, and it’s a reflection of his failure to get anything done of significance in the health-care arena,” Pollack said.

Drew Altman--head of the Kaiser Family Foundation, a nonprofit health-care policy center based in Menlo Park, Calif.--said he was not surprised by Bush’s focus on medical malpractice reform.

“It’s always useful for elected officials to show that they care--whether or not they get anything done,” he said.

From High Point, Bush drove to nearby Greensboro to speak at a $750,000 fund-raiser for the National Republican Senatorial Committee and Elizabeth Hanford Dole, who challenged him for the 2000 GOP presidential nomination and now is a candidate for a Senate seat from North Carolina.

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Times staff writers Charles Ornstein in Los Angeles and Janet Hook in Washington contributed to this report.