Skip to main content

Texas Malpractice Caps Blasted, Defended

 |  By John Commins  
   October 14, 2011

Medical liability caps enacted in Texas in 2003 have not reduced rising medical costs in the Lone Star State, and expose as false claims that malpractice expenses are a key driver for medical inflation, according to a study from Public Citizen.

"Despite the sales campaign to promote Texas as an exhibit of the merits of limiting doctors' liability for mistakes, the real-world data tell the opposite story," Taylor Lincoln, research director of Public Citizen's Congress Watch division and author of the report, said in a media release. "Healthcare in Texas has become more expensive and less accessible since the state's malpractice caps took effect."

Public Citizen's report -- A Failed Experiment: Health Care in Texas Has Worsened in Key Respects Since State Instituted Liability Caps in 2003 -- analyzes the costs and availability of healthcare since Texas imposed the $250,000 cap on non-economic damages. The report says that malpractice litigation has been cut in half, but Medicare spending has soared.

"This contradicts the 'defensive medicine' theory, which holds that fear of litigation is to blame for stark increases healthcare costs. Also, since the caps were instituted in Texas, health insurance costs have outpaced the national average and the percentage of residents lacking health insurance has risen,'" the report says.

However, Jon Opelt, executive director of the Texas Alliance for Patient Access, an advocacy group for malpractice reforms whose members include the Texas Medical Association and the Texas Hospital Association, said in an interview with HealthLeaders that the Public Citizen report is fundamentally flawed, and that it misstates the original intent of the malpractice reforms.

"When proponents argued for a cap it was a discussion about stabilizing insurance rates paid by healthcare providers and attracting new doctors to the state, and that has been overwhelmingly successful," Opelt says. "Never was it stated that passing these reforms would reduce the health insurance premiums for consumers."

According to the Public Citizen report, since Texas instituted its liability limits:

  • Per-enrollee Medicare spending has risen 13% faster than the national average;
  • Medicare spending specifically for outpatient services has risen 31% faster than the national average;
  • Medicare diagnostic testing expenditures have risen 26% faster than the national average;
  • Premiums for private health insurance have risen faster (52%) than the national average (50%);
  • The percentage of Texans who lack health insurance has risen to 25%, solidifying the state's dubious distinction of having the highest uninsured rate in the country;
  • The per capita increase in the number of doctors practicing has slowed to less than half its rate in the years leading up to the caps;
  • The per capita number of primary care physicians practicing in Texas has remained flat, compared to a sharp increase in the years leading up to the caps; and
  • The prevalence of physicians in non-metropolitan areas has declined.

Opelt says he cannot repudiate every statistic highlighted in the study, but he says he doesn't have to, because most of the claims – for example, rising Medicare costs, or the percentage of Texans who are uninsured -- have nothing to do with medical malpractice.

He asserts, however, that any claims that Texas has seen a decline in the numbers of practicing physicians since 2003 are simply untrue. "By any objective measurement what we have seen is the end of the exodus of doctors from our state. We have seen a substantial increase in doctors coming to Texas and practicing, especially in the high-risk fields. What that means is more care for more people and closer to their homes. That is not reflected in their study," he says.

Opelt says the report also gives a false impression that patients' rights to legal redress have been gutted in Texas when, in fact, only non-economic damages have been capped.

"Even with these new reforms in place one could still receive a multimillion dollar judgment," he says. "What it has done is reduced the number of lawsuits filed in this state. It has reduced the number of outlier awards. It has allowed doctors hospitals and nursing homes to find and afford liability coverage so they can treat patients."

Opelt also objected to the study's contention that Texas physicians face less accountability for errors since the imposition of the caps.
"There is nothing in the peer review studies that draw a correlation between lawsuits or the threat of lawsuits to the improved quality of care," he said. "Since the passage of reforms we have seen some significant improvements in Texas, but they are not totally related to the cap. Although it can be stated that dollars that used to go to lawyers and lawsuits are now going to charity care and patient care."

John Commins is a content specialist and online news editor for HealthLeaders, a Simplify Compliance brand.

Tagged Under:


Get the latest on healthcare leadership in your inbox.