Medical Groups: Litigation Expenses to Cost Taxpayers $1 Billion

Cheryl Clark, for HealthLeaders Media , September 3, 2010

The physicians' group letter makes several other arguments:

  • The change would cost taxpayers over $1.5 billion and could act as a financial incentive for trial attorneys to file less meritorious lawsuits against physicians and other healthcare providers. The average cost per case, now an estimated $22,000, would increase, money that could otherwise be used to expand coverage for the uninsured.
  • The Internal Revenue Service in 1997 says litigation expenses advanced by trial lawyers are not deductible regardless of whether a trial attorney uses a gross fee or net fee contract with clients.
  • Proposed legislation now in the House and Senate "has failed to attract enough support to hold hearings on the issue, let alone be considered by either chamber."

The groups support a national cap on pain and suffering awards, similar to that in California and Texas, which does not exceed $250,000.

"The Congressional Budget Office found that medical liability reforms that include a quarter-million dollar cap on non-economic damages would reduce the federal budget deficit by about $54 billion over 10 years. As our nation works to reduce the growth in healthcare costs, it's clear that medical liability reform must be part of the solution."

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