Senate Holds Hearing for Medical Litigation

February 13, 2003

The Senate Judiciary Committee and the Senate Health, Education, Labor and Pensions Committee held a joint hearing this week on “Patient Access Crisis: The Role of Medical Litigation.” Judiciary Chairman Orrin Hatch (R-Utah) strongly expressed the importance of medical liability reform, and urged Congress to make every effort necessary to find a resolution to this crisis.

“The current tort system works against improvements in the healthcare system and increases costs because it forces providers to engage in defensive medicine in order to avoid lawsuits. Medical malpractice premiums have risen dramatically in recent years, in large part due to the current system of “jackpot” justice that permits frivolous lawsuits and unlimited awards of non-economic and punitive damages in most states,” Carl Parks, senior vice president, government relations, of the National Association of Independent Insurers (NAII), said.

Some claim that the crisis is a result of reduced investment income, a sagging economy and intentional misconduct on the part of insurers. Chairman Hatch indicated that there is nothing to suggest that states have been remiss in regulating the insurance industry, and there are no data to suggest that collusion is the cause of rising malpractice insurance rates. Health Education Labor and Pensions (HELP) Committee Chairman Judd Gregg (R-N.H.) attributed rising loss costs and defense costs associated with litigation as the principal drivers of medical malpractice premiums.

Jose Montemayor testified on behalf of the National Association of Insurance Commissioners (NAIC). Based on his experience as commissioner of insurance for the state of Texas, he indicated that increasing amounts paid for claims are the primary cause of rising costs in medical malpractice insurance in the state.

Witnesses included several patients who have experienced the medical liability crisis, Shelby Wilbourne, M.D., a physician on behalf of the American College of Obstetrics and Gynecology, and Lawrence Smarr, president Physician Insurers Association of America.

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