The New York Times’s man in Albany, Thomas Kaplan, is on the malpractice case—that is, the state legislature’s efforts to limit the damages for pain and suffering that injured patients can recover from a hospital or doctor who makes a serious mistake. A few weeks ago, Kaplan and a colleague reported that New York governor Andrew Cuomo was flirting with relieving hospitals of any big payouts in malpractice cases, which in turn might make it harder for patients to bring any lawsuits at all—something some health care providers have long hoped for.
The quid pro quo for this gift apparently was a promise that the hospitals would not fight efforts to cut Medicaid reimbursements. Such cuts could impact their bottom lines, but if under a deal the hospitals did not have to pay out big bucks for malpractice awards, they might come out big winners this budget season after all.
In our earlier piece, we questioned the Times’s garbled story, which did little to untangle the myths of malpractice for the public. Friday’s story was different, and Kaplan deserves kudos for casting a skeptical eye on the case being made for the savings that would result from capping damage awards. Looking at the evidence, Kaplan cut through the claims made by protagonists in this latest Albany drama. “Other states that have similar caps in place offer cautionary evidence about the big savings for health care providers that such limits are believed to produce,” Kaplan wrote.
He looked at California—the poster child for malpractice reform—and found that in the years after the state limited damages in the mid-1970s, malpractice insurance premiums actually rose. But supporters of caps, according to the Times, argue that eventually claims decreased, resulting in lower premiums. “I don’t think the doctors even believe this saves them money,” Jamie Court, the president of the California advocacy group Consumer Watchdog, told Kaplan. “But what they know is this limits their legal accountability, and that’s more important for them.”
Researchers have shown that limiting awards does slow the rate of growth in malpractice premiums, but they have not found the “huge savings” that New York politicos are predicting, Kaplan reported. “Without question, it’s not a game-changer,” one researcher said. Kaplan also noted that this deal is being fueled by a single piece of evidence the pols have used to make the argument for limiting damages. A committee appointed by Governor Cuomo to find Medicaid cuts dusted off a 2004 study commissioned by a bunch of malpractice insurance companies saying that a $250,000 cap would reduce costs for New York doctors and hospitals by twenty-four percent. Does that offset the losses to the hospitals for taking lower Medicaid payments? Will the hospitals be back wanting more if these savings don’t materialize? Those are questions Kaplan may want to examine in his next piece.
And while he’s at it, he could look at what caps on damages actually do to lower overall health care costs, not just reducing insurance expenses for doctors. In an Excluded Voices interview, health policy expert Dr. Robert Berenson told Campaign Desk:
In states where there are caps, there is no reason to believe that the costs of care are much different than they are in neighboring states with more liberal malpractice laws. Liability insurance premiums, however, are lower and more affordable for providers.
Berenson explained that caps could mean some injured people will not have their day in court, because lawyers now will only take the very strongest cases. Caps “will reduce suits and payouts, and that will hold down premiums for providers,” he said. “No one has successfully studied what that means for quality and safety for patients.” In other words, caps may do nothing to actually improve care. The quality of care part doesn’t seem to be part of Albany’s equation this year.