Tort Reform In Texas Could Teach Washington a Lesson

Thu, 09/17/2009 - 07:26 — KathleenMcKinley

In yesterday's Washington Post, Peggy Venable tells Pres. Obama that he need not just "try" some pilot programs on tort reform in states, as he proposed in his health care speech, he need look no further than Texas. Texas passed tort reform in 1995 and passed even better reform in 2003 and 2005. Has it made a difference? I would say so:

A 2008 study from the Perryman Group found that perhaps the most visible economic impact of the lawsuit reforms are the benefits experienced by Texans who have better access to high-quality healthcare. Doctors and hospitals are using their liability insurance savings to expand services and initiate innovative programs; those savings have allowed Texas hospitals to expand charity care by 24 percent.

The total impact of tort reforms implemented since 1995 includes gains of $112.5 billion in spending each year as well as almost 499,900 jobs in the state. The fiscal stimulus to the state from judicial reforms is almost a $2.6 billion per year increase in state revenue. In addition, these reforms are responsible for approximately 430,000 individuals having health insurance than would otherwise, and there has been an increase in the number of doctors, particularly in regions which have been facing severe shortages.

I'd say there has been an increase. In the last three years, 7000 doctors have moved to Texas. When a doctor knows he doesn't have to put up with ambulance chasing lawyers constantly, it's worth the move. And Texas benefits. So would the country.

Because of the reforms Texas Medical Liability Trust, one of the largest malpractice insurance companies in the state, has cut its premiums by 35%, saving doctors some $217 million over four years. Since reforms bring competition to the malpractice insurance industry in Texas, we have benefited with over 30 new insurance companies competing for business. This drives all our rates down.

I hope the Pres. Obama and Congress understands all this, and understands how important tort reform is to bringing down the cost of heathcare for all Americans.

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