One of the hottest debates in the US heathcare shoot-out, that seems to have strung along into this year’s elections cycle, is the debate over tort reform and the ever rising cost of medical malpractice premiums. Those who oppose Americans getting affordable healthcare have said that it is the hundreds of medical malpractice claims that raise the cost of insurance and overall healthcare in America today. Reality and the hard numbers don’t reflect their beliefs, but of course something as pesky as the truth has never stopped a politician no matter what side of the fence they seem to sit upon.
We detailed why the tort reform debate and the misconception of medical malpractice is a bunch of hot air earlier in this blog in the article “Tort “Reform”: The Big Payoff to Candidates That Support Malpractice Lawsuit Caps.” This article is here to explain how the Obama administration intends quell those concerns by pandering and throwing money at the issue.
Last week, Health and Human Services (HHS) Secretary Kathleen Sebelius announced that the Agency for Healthcare Research and Quality (AHRQ) has awarded $25 million in funding for programs to improve patient safety and lessen the number of malpractice lawsuits filed. The grants are part of a patient safety and medical liability initiative that President Obama outlined in an address last September to a joint session of Congress.
Medical Malpractice Grants
What this federal grant program intends to do is reduce preventable injuries, improve communication between doctors and patients, lower malpractice premiums, and “ensure that patients are compensated in a fair and timely manner for medical injuries, while also reducing the incidence of frivolous lawsuits,” according to an agency press release.
Most of the $25 mil (around $23 mil) will go to 20 separate programs and around $2 mil will be spent on conclusive research. The awards include 3 year grants of up to $3 mil to states and health care institutions for implementation and evaluation of patient safety and medical liability demonstrations, as well as 1 year planning grants of up to $300,000.
The grants are available to both institutions and individuals under the following guidelines:
- State governments, units of State governments, coalitions of State governments, established associations of State governments.
- Established health care systems. Hsiao defines a health system as having capacities (e.g., hospitals, physicians), activities (e.g., health services), interconnections (e.g., financing, oversight, management), and purpose. Its components might include multiple States, localities, Tribal governments, universities, colleges, hospitals, nonprofit organizations, faith-based organization, community-based organizations, and Federal agencies. Applicants to this FOA must share a long-established, legal entity as sponsor, and sufficient service volume to statistically power any proposed intervention.
- Organizations must also fit under AHRQ’s grant authorization under 42 USC 299c-5(c), which allows AHRQ to make grants to public and nonprofit entities.
- Any individual with the skills, knowledge, and resources necessary to carry out the proposed research as the PD/PI may work with their sponsoring organization to develop an application. AHRQ encourages individuals from underrepresented racial and ethnic groups as well as individuals with disabilities to apply. AHRQ requires a minimum time commitment of 20% annual effort from the PD/PI or the Project Manager, depending upon how the applicant structures the project’s organization and work plan.
The grants are overall intended to streamline a process that the HHS views as hamstrung by complicated legal issues. The programs studied under the grants include a judge-directed legal negotiation program, “safe harbors” for state-endorsed evidence-based care guidelines, and early disclosure of medical errors by hospitals and clinics with offers of prompt compensation.
Essentially, the thinking here is the faster the process, the lower the legal costs, and thus the lower overall cost to insurance providers. The problem is that medical malpractice payouts haven’t risen since the 1980’s, but medical malpractice insurance has steadily risen consistently over the last decade with little to no explanation other than greed by the insurance companies.
Medical Malpractice Lawsuits

Yet skepticism can only go so far before it becomes unconstructive. Any system is not perfect and the medical malpractice system certainly is not. There are many states that have chosen to take medical malpractice lawsuits head on through legislation by capping the amounts paid out to plaintiffs. Unfortunately this has not lowered premiums and has only served to hurt patients with legitimate claims.
Our own home of Washington was one of those states that believed the hype. The state supreme court ended up repealing the medical malpractice law as unconstitutional. The same thing recently happened in Illinois and other similar lawsuits are making their rounds in other states that host caps as a solution.
The new grant initiative is hoping to take a different angle to a similar goal to lower costs and in turn lower premiums. In a White House blog entry, Ezekiel Emanuel, MD, PhD, special adviser for health policy at the Office of Management and Budget, noted, “As reviews by both the Robert Wood Johnson Foundation and AHRQ have revealed, we lack a solid evidence base for determining which practices will provide fair and prompt compensation to patients, reduce preventable injuries, improve the quality of care, and reduce liability premiums.”
We can only hope that Mr. Emanuel’s evidence comes out positive, but we fear that no matter how states or the federal government attempt to lower costs, insurance premiums will keep on rising until state or federal bureaucracies offer medical malpractice insurance to compete with the market and stem the rising tide of unjustified profit.
Medical Malpractice Lawyers
The proponents and creators of these grants are, of course, trying to frame the system as benefiting the patients and the physicians equally, but what the system may turn out to be is a quick stopgap to lower settlement payouts on what are major medical errors.
“This new research is the largest government investment connecting medical liability to quality and aims to improve the overall quality of healthcare,” Secretary Sebelius said.
“The goals of the HHS Patient Safety and Medical Liability initiative are widely supported throughout the healthcare system, and we solicited broad-based input to ensure that it reflects the needs of stakeholders,” AHRQ director Carolyn M. Clancy, MD, said in a statement. “The projects we have funded help create measurable differences in the safety of healthcare for patients and help bring rationality and fairness to our medical liability system.”
We have the most sincere hope that this program works and will benefit both patients and the healthcare system as a whole. We also hope that the insurance industry will be honest about their business, recognize the lowered costs, and reduce premiums accordingly, but on this last point we will certainly not be holding our breath.
If you or a loved one have found that you have been injured or killed because of a medical error it is still your right to seek adequate compensation for your pain and suffering to assure that another patient will not have to go through what you are. Call the Medical Malpractice Lawyers at Phillips Webster for a free consultation.
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