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David Dobbs presents the Swedish fix tomedical malpractice. Michael Kinsleyattacks the American MedicalAssociation's approach to tort reform.Atul Gawande argues that when medicalerrors happen, doctors are to blame,not "the system."

The Medical Malpractice MythForget tort reform. The Democrats have a better diagnosis.By Ezra KleinPosted Tuesday, July 11, 2006, at 6:20 AM ET

The Republican answer to runaway health-care spending isto cap jury awards in medical malpractice suits. For thefifth time in four years, Senate Majority Leader Bill Fristtried and failed to cap awards at $250,000 during his self-proclaimed "Health Care Week" in May. But this time, theDemocrats put a better idea on the table.

Sens. Hillary Clinton and BarackObama also want to save onhealth care. But rather thancapping jury awards, they hope

to cut the number of medical malpractice cases by reducing medicalerrors, as they explain in an article in the New England Journal ofMedicine. In other words, to the Republicans, suits and payouts arethe ill. To the Democrats, the problem is a slew of medical injuriesof which the suits are a symptom. The latest evidence shows theDemocrats' diagnosis to be right.

The best attempt tosynthesize the academic literature on medicalmalpractice is Tom Baker's The Medical MalpracticeMyth, published last November. Baker, a lawprofessor at the University of Connecticut whostudies insurance, argues that the hype aboutmedical malpractice suits is "urban legend mixedwith the occasional true story, supported byselective references to academic studies." After all,

including legal fees, insurance costs, and payouts, the cost of the suits comes to less than one-half of 1 percent of health-care spending. If anything, there are fewer lawsuits than would beexpected, and far more injuries than we usually imagine.

As proof, Baker marshals an overwhelming array of research. The most impressive andcomprehensive study is by the Harvard Medical Practice released in 1990. The Harvardresearchers took a huge sample of 31,000 medical records, dating from the mid-1980s, andhad them evaluated by practicing doctors and nurses, the professionals most likely to besympathetic to the demands of the doctor's office and operating room. The records wentthrough multiple rounds of evaluation, and a finding of negligence was made only if twodoctors, working independently, separately reached that conclusion. Even with thisconservative methodology, the study found that doctors were injuring one out of every 25patients—and that only 4 percent of these injured patients sued.

The Harvard study stands for a large body of literature. On their own, however, the resultsdon't disprove the Republicans' thesis that many medical malpractice suits are frivolous. Maybebadly injured patients don't sue, while the reflexively litigious clog up the legal system, makingtort reform a viable solution. But a new study, released in May, demolishes that possibility. Dr.David Studdert led a team of eight researchers from Harvard School of Public Health, Brighamand Women's Hospital, and the Harvard Risk Management Foundation* who examined 1,452medical malpractice lawsuits. They found that more than 90 percent of the claims showedevidence of medical injury, which means they weren't frivolous. In 60 percent of these cases,the injury resulted from physician wrongdoing. In a quarter of the claims, the patient died.

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When baseless medical malpractice suits were brought, the study further found, the courtsefficiently threw them out. Only six of the cases in which the researchers couldn't detect injuryreceived even token compensation. Of those in which an injury resulted from treatment, butevidence of error was uncertain, 145 out of 515 received compensation. Indeed, a biggerproblem was that 236* cases were thrown out of court despite evidence of injury and error topatients by physicians. The other approximately 1,050 cases, in the research team's opinion,were decided correctly, with damage awards going to the injured and dismissal foiling thefrivolous suits.*

Nor is there evidence to show that the level of jury awards has shot up. A recent RAND studylooked at the growth in malpractice awards between 1960 and 1999. "Our results arestriking," the research team concluded. "Not only do we show that real average awards havegrown by less than real income over the 40 years in our sample, we also find that essentiallyall of this growth can be explained by changes in observable case characteristics and claimedeconomic losses."

Which brings us back to the Republicans' and Democrats' divergent approaches. The Obama-Clinton legislation fits well with Studdert's and RAND's findings. It also builds on successfulefforts by the nation's anesthesiologists and a few hospitals to reduce their medical malpracticepayouts.

Anesthesiologists used to get hit with the most malpractice lawsuits and some of the highestinsurance premiums. Then in the late 1980s, the American Society of Anesthesiologistslaunched a project to analyze every claim ever brought against its members and develop newways to reduce medical error. By 2002, the specialty had one of the highest safety ratings inthe profession, and its average insurance premium plummeted to its 1985 level, buckingnationwide trends. Similarly, feeling embattled by a high rate of malpractice claims, theUniversity of Michigan Medical System in 2002 analyzed all adverse claims and used the datato restructure procedures to guard against error. Since instituting the program, the number ofsuits has dropped by half, and the university's annual spending on malpractice litigation isdown two-thirds. And at the Lexington, Ky., Veterans Affairs Medical Center, a program of earlydisclosure and settlement of malpractice claims lowered average settlement costs to $15,000,compared with $83,000 for other VA hospitals.

Clinton and Obama would offer federal grants and support to unroll such programs nationwide.And they want to create a national database to track incidents of malpractice and fundresearch into standards, procedures, and technologies that would prevent future injuries. So,what say you, Bill Frist? Is it time for another Health Care Week?

Correction, July 11, 2006: The original paragraph misstated the relevant numbers in theStuddert malpractice study. (Return to the corrected paragraph.)

Correction, July 17, 2006: The original sentence incorrectly stated the institutionalaffiliations of the researchers. (Return to the corrected paragraph.)

The original sentence incorrectly stated the number of cases thrown out of court despiteevidence of injury and physician error. (Return to the corrected paragraph.)

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Ezra Klein is a writing fellow at The American Prospect.

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Jonathan Michael Lloyd The above is all well and good, but what of the costs *within* the healthcare system due toa perception of risk due to lawsuits? I speak of the multiple lab tests that may not benecessary for a diagnosis or treatment option, and which add up to billions of dollarsacross this great land of ours.

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