On June 15, the New York Times described how Obama is open to reining in medical suits by trying to reduce malpractice suits. There are some fundamental issues that need to be on the table when thinking about this issue -- the most important being that the "standard of care" is not necessarily evidence-based.
There are also far more medical errors than there are malpractice suits, and the few frivolous suits that exist rarely make it to settlement, let alone court. I am currently exploring the effects of malpractice on maternity care, and will address these issues below.
The AMA and doctors are in favor of protecting doctors from malpractice lawsuits, and they have good reason: medical liability insurance premiums are absurdly expensive, especially in some states (e.g. Florida). Practitioners must then pass along the costs to consumers, leading to inflation of health care costs. However, premiums are not based entirely on the risk of being sued: liability insurers invest the premiums and then must increase their rates when their return on investments decline (as would be happening now in the recession).
They also raise their rates when they don't face competition, and some states have only one or two liability insurers. So liability insurance isn't in sync with actual malpractice activity. Using the National Practitioners Data Bank, I have found that obstetric malpractice suits have fluctuated over the years 1991-2004 rather than increasing over time. (See graph below.) This is not what one would expect based on the increased fear of litigation that doctors express.
In fact, many doctors practice in fear of litigation, and some have argued that this leads to "defensive medicine": medical practices designed to avert the future possibility of malpractice suits, rather than to benefit the patient. This drives up the cost of health care, because payers end up paying for unnecessary procedures. But again, their fear is out of proportion to the actual risk: the risks of lawsuits have not increased, and the average awards in medical malpractice suits have increased only slightly (adjusted for inflation).
On the other hand, negligent medical errors are far more common than people in favor of capping damages want to acknowledge. In the Harvard Malpractice Study, Dr. David Studdert led a team of eight researchers from Harvard School of Public Health, Brigham and Women's Hospital, and the Harvard Risk Management Foundation. The study used a conservative methodology to determine whether or not negligence occurred in 31,000 medical records, dating from the mid-1980s. Practicing doctors and nurses evaluated the cases, and the study made a finding of negligence only if two doctors, working independently, separately reached that conclusion.
The study found that doctors were injuring 1 out of every 25 patients, and only 4% of these injured patients sued. So the actual rate of negligent medical error is much higher than the litigation system suggests. Also, fewer than 10% of cases were "frivolous," meaning that no negligent medical error occurred, and the courts efficiently threw them out. Only 6 cases where researchers couldn't detect injury received even token compensation.
This issue of medical error is already part of the argument against reform: many who are against caps on damages point to the high rate of error and its impact on patients and their families. But the missing piece that no one on either side of this debate seems to talk about is that the "standard of care" is part of the problem. The New York Times article suggests that President Obama is "open to offering some liability protection to doctors who follow standard guidelines for medical practice."
But standard guidelines are often not based on the best scientific evidence, and this is especially true in the case of obstetrics. Evidence-based medicine suggests that optimal management of birth involves minimal interventions, and yet the standard of care involves high rates of induction of labor, often using drugs like Cytotec that are contra-indicated for this purpose (see here and here on the dangers of this drug), artificial stimulation of labor, amniotomy, confinement to bed, restriction of food and drink, non-physiologic positions for pushing, and very high rates of cesarean section (currently about 1/3 of births nationwide).
This is the "standard of care" but is not evidence-based -- there is a large body of scientific research that finds that all of these practices are harmful and lead to unnecessary and preventable instances of fetal distress, cesarean section, and maternal mortality and morbidity. Moreover, there is some evidence that doctors do more interventions and more cesareans as a defensive practice, because it fits the standard of care and despite the fact that it goes against the scientific evidence.
So offering protection to doctors who follow standard guidelines for medical practice will not reduce medical errors and preventable injuries, at least not in obstetrics. In order to do that, President Obama's health care reform should think about offering liability protection to doctors who practice evidence-based medicine. To let the "standard of care" continue to rule is akin to letting the fox guard the henhouse.