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Mar 24

Ending Defensive Medicine Is Key To Containing Health Care Costs

by Wayne W. Oliver
Originally published in Investor Business Daily on March 24, 2017

Ending Defensive Medicine Is Key To Containing Health Care Costs

As Congress moves to vote on the American Healthcare Act, it is important to note the five principles for repealing ObamaCare set forth by President Trump. Included among these planks were “legal reforms to protect doctors and patients from unnecessary costs that drive up insurance costs.”

Every day in a physician’s office or hospital across this country, doctors order more tests, procedures or medications than are medically necessary for a patient just in case there is ever a lawsuit.

This is known as defensive medicine.

Gallup reports that more than 1 in 4 health care dollars is wasted on unnecessary care so a physician can protect himself in case a trial lawyer decides to sue.

A 2012 survey conducted by the American Academy of Orthopedic Surgeons found that 96% of its doctors reported practicing defensive medicine. Researchers at Vanderbilt University found that the nation’s orthopedic surgeons alone spent $173 million a month or $2 billion annually on X-rays, CT scans, MRIs, blood work, medications and other procedures that are not clinically necessary.

The Official Journal of the Congress of Neurological Surgeons reported in 2015 that a national survey of its neurosurgeons said they too practice defensive medicine to protect themselves from lawsuits.

There are very few practice specialties or general practitioners that aren’t immune from this expensive behavior. As a result, patients pay higher insurance premiums, copays, deductibles and out-of-pocket expenses to cover this waste.

BioScience Economics, a health care economics firm, estimates that defensive medicine costs our economy $700 billion annually in both the public and private sectors. Of that, almost half impacts federal and state taxpayers as about $320 billion is wasted on defensive medicine by doctors who see Medicare and Medicaid patients.

If health reform is going to succeed this year, we must be transformational in our approach to the replacement of ObamaCare and targeting cost-containment. That means Congress should consider the 10th Amendment when crafting health care policy and return as many decisions as possible to the states.

It is only in the states where we can find the room for bold experiments and the ability to take on sacred cows such as the trial bar. To do more than just restructure the health care insurance system, it will take a plan to tackle wasteful, defensive medicine.

In 2009, the Obama administration sold out physicians. The Affordable Care Act was adopted with no regard to its impact on the doctor-patient relationship. In particular, it failed to address one of the primary threats to cost containment: trial lawyers.

Even during the debate on the Affordable Care Act, President Obama acknowledged that doctors shouldn’t “feel like they are constantly looking over their shoulder for fear of lawsuits.” Yet with most Democrats financed by the trial bar, Obama refused to take on the trial lawyers.

That’s why this year, a state-based approach to eliminating defensive medicine will have greater chance of success. Several states have enacted sweeping malpractice reform. But Florida, Alabama, Tennessee, Georgia, Kentucky and Missouri are examining the issue once again — many of them with cost-containment and defensive medicine in mind.

Physicians will tell you that the practice of medicine is now a game of defense. The majority of physicians in this country have faced at least one very costly malpractice suit in their career, and the vast majority of those have been suits filed under frivolous circumstances.

As a result, doctors have changed their behavior to practice defensive medicine to protect themselves from financial ruin. The medical profession is one of the few in which a professional can be sued and risk loss of his entire personal wealth with one mistake — or worse yet, a frivolous claim.

Trial lawyers are known for manipulating patients and the courts for their own benefit — despite the fact it is now driving up health care costs for all of us in the form of defensive medicine.

As Congress debates the American Healthcare Act, it will then move quickly to second and third phases of repealing ObamaCare. Those efforts should include incentives for states to embrace litigation reform and end defensive medicine. Ending defensive medicine may be the best prescription to bring relief to what’s making health care too expensive for everyone.

 

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