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    Restricting patient legal rights in Texas through medical liability tort reform has not lowered health care costs as intended. Medicare spending has increased faster in Texas than the national average in the three years before and after tort reform. Specifically, average annual growth in Medicare spending per enrollee was 3.80% in Texas and 3.36% nationally before reform, and 7.43% in Texas versus 6.03% nationally after reform, indicating that limiting litigation has not curbed health care spending increases. In fact, 10 of the top 15 most expensive areas for Medicare spending are located in states that have imposed severe limits on patient legal rights.

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    Restricting patient legal rights in Texas through medical liability tort reform has not lowered health care costs as intended. Medicare spending has increased faster in Texas than the national average in the three years before and after tort reform. Specifically, average annual growth in Medicare spending per enrollee was 3.80% in Texas and 3.36% nationally before reform, and 7.43% in Texas versus 6.03% nationally after reform, indicating that limiting litigation has not curbed health care spending increases. In fact, 10 of the top 15 most expensive areas for Medicare spending are located in states that have imposed severe limits on patient legal rights.

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    11 views1 page

    MedicareSpeding HealthCosts

    Uploaded by

    HZwingli
    Restricting patient legal rights in Texas through medical liability tort reform has not lowered health care costs as intended. Medicare spending has increased faster in Texas than the national average in the three years before and after tort reform. Specifically, average annual growth in Medicare spending per enrollee was 3.80% in Texas and 3.36% nationally before reform, and 7.43% in Texas versus 6.03% nationally after reform, indicating that limiting litigation has not curbed health care spending increases. In fact, 10 of the top 15 most expensive areas for Medicare spending are located in states that have imposed severe limits on patient legal rights.

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    of 1

    RESTRICTING PATIENT RIGHTS

    DOES NOT LOWER HEALTH COSTS


    Spending Increases Faster in Texas
    It has been widely reported that costs
    associated with medical liability account for only TEXAS NATIONAL
    about 1.0 – 1.5% of overall health care Inflation-
    adjusted
    Inflation-
    adjusted

    expenses. 1 This amounts to a rounding error in


    total TEXAS total NATIONAL
    Medicare Annual Medicare Annual
    spending Rate of spending Rate of
    the overall effort to reduce health care costs per enrollee Increase per enrollee Increase

    and ensure that coverage is available. 2000 $ 6,769.96 $ 6,316.83

    2001 $ 6,632.24 -2.03% $ 6,294.13 -0.36%


    Rather than accruing significant cost savings to 2002 $ 7,004.75 5.62% $ 6,608.36 4.99%

    the health care system, Texas has seen 2003 $ 7,552.11 7.81% $ 6,968.29 5.45%

    Medicare spending increase faster than the Average 3.80% 3.36%

    national average in the three years following


    passage of so-called tort “reform.” This is 2004 $ 8,188.54 8.43% $ 7,520.15 7.92%

    exemplified by the experience in McAllen. 2 2005 $ 8,860.16 8.20% $ 8,020.69 6.66%

    2006 $ 9,360.59 5.65% $ 8,303.75 3.53%


    The chart at right shows that the average rate of
    Average 7.43% 6.03%
    growth in Medicare spending per enrollee in the
    Growth 01-03 to 04-06 95.47% 79.62%
    three years before patients lost their rights was Source: The Dartmouth Atlas of Health Care
    3.80% in Texas compared to 3.36% for the (http://www.dartmouthatlas.org/index.shtm)

    national average. In the three years following


    so-called tort “reform,” average Medicare
    spending increased 7.43% in Texas compared to 6.03% for the national average. 3

    Texas Medicare costs have increased more rapidly than the national average. In fact, Texas has seen
    an average growth rate that is 16% higher than the national average since Texas severely restricted
    patient legal rights. If the medical industry mantra that the threat of litigation drives up costs due to
    so-called “defensive medicine,” why are Texas Medicare expenditures spiraling higher than the
    national average after the threat of litigation was essentially taken away in 2003? In fact, 10 of the 15
    health markets with the highest Medicare spending per enrollee are in states in which the medical
    and insurance industries successfully lobbied for severe limits on patients’ rights. 4

    Medical facilities are undoubtedly enjoying significant cost savings because patients who are harmed
    through medical negligence have had their rights severely restricted. Are these resources being used on
    unnecessary capitol expenses designed to drive up system utilization, increasing – not decreasing –
    overall health system costs?

    1
    See: http://prescriptions.blogs.nytimes.com/2009/08/31/would-tort-reform-lower-health-care-costs/
    2
    See: http://www.newyorker.com/reporting/2009/06/01/090601fa_fact_gawande
    3
    The Dartmouth Atlas of Health Care; http://www.dartmouthatlas.org/index.shtm
    4
    Id. Among the 10 most expensive markets, 4 are in Texas (Corpus Christi, Dallas, Harlingen, McAllen)

    For more information, contact Texas Watch at 512-381-1111.

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