Washington, D.C. – House Judiciary Committee Ranking Member Lamar Smith (R-Texas) today praised a Congressional Budget Office (CBO) report regarding the impact of tort reform on health care costs.
The report found that tort reforms would reduce health care spending by an estimated $11 billion in 2009. The CBO also found that a national tort reform package would reduce federal budget deficits by roughly $54 billion over the next 10 years. Among the reforms reviewed in the study, CBO considered a cap on pain and suffering damages first on its list of tort reforms that would lead to significant cost savings.
Ranking Member Smith issued the following statement calling for Congress to take up tort reform:
“The CBO study confirms what Republicans have been saying all long: tort reform will reduce health care costs for all Americans. According to a study by the Harvard School of Public Health, 40 percent of medical malpractice suits filed in the U.S. are ‘without merit.’ Doctors are so concerned about frivolous lawsuits that they order unnecessary—and expensive—tests and procedures that are of no benefit to the patient. The Department of Health and Human Services estimates the national cost of defensive medicine is more than $60 billion.
“The costs of litigation and defensive medicine are then passed off to the patient in the price of health care. By placing a reasonable cap on unquantifiable damages, we can help reduce costs and pass on the savings to patients. In the handful of states that have enacted tort reform, health care costs have fallen and the availability of medical care has expanded. In Texas alone, health care premiums fell by 30% and more than 14,000 doctors returned or set up new practices in the state.
“I would remind critics who claim that $11 billion in savings for 2009 isn’t significant that earlier this year President Obama launched a $100 million savings initiative as part of his campaign for government reform. At the time, his press secretary Robert Gibbs said ‘only in Washington, D.C. is $100 million not a lot of money.’ Certainly the President can see the importance of this report and the tremendous amount of savings tort reform can provide for the American people.
“President Obama has said he wants to establish ‘demonstration projects’ to measure the effectiveness of tort reform. This study and the states that have already passed laws are proof enough that tort reform works. We don’t need to test tort reform, we need to enact it.”
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