WASHINGTON BUREAU — The Congressional Budget Office reported Friday that tort reform would save the federal government $54 billion over 10 years.
The CBO looked at the medical malpractice question in response to a request by Sen. Orrin Hatch, R-Utah, the highest ranking Republican member of the Senate Health, Education, Labor and Pensions Committeee.
The CBO estimates significant changes in tort reform policies could save $41 billion for the federal government from 2010 to 2019 and increase government revenue by $13.
“Because of mixed evidence about whether tort reform affects the utilization of health care services,” past analyses by the CBO have “focused on the impact of tort reform on premiums for malpractice insurance,” the CBO says.
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But newer research suggests that lowering the cost of medical malpractice tends to reduce the use of health care services, the CBO says.
The CBO says the government could cap tort awards by limiting awards for noneconomic damages, such as pain and suffering, or by limiting the amount awarded for punitive damages, or the situations in which a plaintiff could receive awards for punitive damages.
“The two most common ways of imposing limits on liability are to shorten the statute of limitations on malpractice claims and to change the rules regarding joint-and-several liability,” the CBO says.
In practice, the principle of joint-and-several liability gives claimants a chance to collect from the defendant that appears to have the deepest pockets, regardless of how much responsibility that defendant had for the injury.
“Replacing joint-and-several liability with a ‘fair-share’ rule would limit each defendant’s financial liability to his or her percentage share of responsibility for the injury,” the CBO says.