In the recent health care debate, Republicans have maintained, as the centerpiece of their proposals, that enacting government imposed, one size fits all "caps" or limits on malpractice lawsuits will dramatically decrease health care costs and premiums. In broken record fashion, they have repeated this canard, as if federalizing state malpractice laws(the very government intervention they otherwise loathe at every turn), is the magic elixir that will solve our escalating health care costs.
Except that there's one major hole--better yet a crater--with this argument. Better yet, there's 32 holes to be exact. At least 32 states have already passed caps on malpractice damages that victims can recover. So we have some history and some data to test this insurance friendly hypothesis.
The biggest crater of all is California. In approximately 1975, it passed a $250,000 cap on "non-economic" or pain and suffering damages. Translation: lose your limb, an organ, or the ability to walk, talk, or function, and your lifetime of misery is reduced to an arbitrary $250,000.
California's caps are often cited as a "model" reform for politicians who seek to impose government imposed caps on all 50 states. So it stands to reason: if there is a direct relationship between capping malpractice damages and health care costs and premiums, why on earth is Blue Shield, California's largest insurer, seeking to hike premiums by 59%? Here's their official reason:
"...our individual market medical costs are rising rapidly due to higher provider prices, increased utilization, and the fact that healthier people are dropping coverage during a bad economy..."
That, plus good old fashioned greed, and friendly laws/regulations allowing such rate hikes, is probably the real motivation. But this story proves what those opposed to the magic wand of lawsuit caps have been arguing for years: the health care cost conundrum is due to a multitide of factors, the main one being that people are living longer, and therefore are utilizing health care resoures longer.
I have yet to hear one person in the media ask any politician this simple question: "If caps on damages are the answer to dramatically reducing health care costs, can you show me one state where health care costs have been reduced by one penny in the 32 states that have passed these caps?"
Anyone? Anyone? Mr.Buehler.....? Yet, this lie is repeated over and over on Sunday talk shows and on the floor of Congress as if it is a truism. Meanwhile, California consumers are about to get soaked in one of the most classic "bait and switch" tactics around right now: caps and reduced health care costs.