The Krauthammer Plan for Healthcare Reform

While I’m all in favor of the second component of Dr. Krauthammer’s proposal for healthcare reform:

Real health-insurance reform: Tax employer-provided health-care benefits and return the money to the employee with a government check to buy his own medical insurance, just as he buys his own car or home insurance.

(I’d be in favor of taxing compensation rather than wages; there’s no sound economic reason to make the distinction), I wonder if he realizes that the first component of his proposal:

Tort reform: As I wrote recently, our crazy system of casino malpractice suits results in massive and random settlements that raise everyone’s insurance premiums and creates an epidemic of defensive medicine that does no medical good, yet costs a fortune.

An authoritative Massachusetts Medical Society study found that five out of six doctors admitted they order tests, procedures and referrals — amounting to about 25 percent of the total — solely as protection from lawsuits. Defensive medicine, estimates the libertarian/conservative Pacific Research Institute, wastes more than $200 billion a year. Just half that sum could provide a $5,000 health insurance grant — $20,000 for a family of four — to the uninsured poor (U.S. citizens ineligible for other government health assistance).

What to do? Abolish the entire medical-malpractice system. Create a new social pool from which people injured in medical errors or accidents can draw. The adjudication would be done by medical experts, not lay juries giving away lottery prizes at the behest of the liquid-tongued John Edwardses who pocket a third of the proceeds.

would require a constitutional amendment? If you think we’re having problems passing healthcare reform now, try passing a constitutional amendment.

It’s a rather clear violation of the Seventh Amendment:

In suits at common law, where the value in controversy shall exceed twenty dollars, the right of trial by jury shall be preserved, and no fact tried by a jury, shall be otherwise reexamined in any court of the United States, than according to the rules of the common law.

16 comments… add one
  • PD Shaw Link

    You could do an opt in and give the plaintiff an opportunity to file their claim before an administrative board (voluntary waiver).

    He’s also likely wrong that such a system would cut out the lawyers. The doctors and hospitals would certainly exercise their right to representation, given the amounts at issue (and license revocation?!?), so the plaintiffs would be at a severe disadvantage without their own.

  • Brett Link

    Real health-insurance reform: Tax employer-provided health-care benefits and return the money to the employee with a government check to buy his own medical insurance, just as he buys his own car or home insurance

    You mean like some type of voucher? I’ve suggested it in another thread, although I think you’d need to combine it with

    A)an individual mandate to buy insurance, with some decent penalties;

    B)regulations on what type of health insurance package the voucher could be used for (no “cheapo” packages that leave the purchaser bankrupt when they get a chronic illness);

    C)”Pre-conditions” screening and “Rescission” are outlawed.

    Another idea might be to have one of the insurers set up as the “default” option – if you didn’t apply your voucher to a different company, you’re insured by the “default company” (although you’d have to really standardize insurance packages). That way, nobody would be without insurance at some point, and the default insurer and other insurers would compete to hold on to and lure customers away, respectively.

  • Brett Link

    EDIT: “in another comment on one of your posts way back”.

    It’s basically what public housing did for while – vouchers and the Low Income Housing Tax Credit.

  • PD Shaw:

    My point is that as stated Dr. Krauthammer’s version of what’s called “tort reform” would require a constitutional amendment. I think there might be other ways to accomplish similar things without a constitutional amendment but what he’s suggesting would definitely require one.

    I recognize that the need for malpractice reform is a regular Republican talking point and I agree that it might accomplish a little at the margins. I’m skeptical that it’s either necessary or sufficient.

  • Brett Link

    I recognize that the need for malpractice reform is a regular Republican talking point and I agree that it might accomplish a little at the margins. I’m skeptical that it’s either necessary or sufficient.

    It’s necessary, but it’s not the magic key that Republicans seem to think it is.

  • PD Shaw Link

    I agree. Krauthammer’s vision might also run afoul of the Constitutional provisions that vest the judicial power in the courts, including regulation of the practice of law. But Krauthammer was trying to be constructive, so I thought I would be as well. You could make the system voluntary, but that means making it attractive. You probably can’t get rid of lawyers or judges either. So the cost-savings are speculative, and hing on the defensive medicine argument. Would doctors be less likely to provide excess treatment if they were merely reviewed by a panel of medical doctors with the power to take away their license, than they would be a jury?

  • But, ultimately, that’s already the case, at least in theory. Medical malpractice doesn’t consist of a physician harming a patient but in harming a patient while not conforming to the standards of medical practice (which is decided by a panel of medical doctors). That juries routinely violate this is an accident of the system (in the Aristotelian sense), not its essence.

  • PD Shaw Link

    I think the issue of “lottery” verdicts stems from the non-economic damages. What is the monetary value of the pain & suffereing, and emotional loss to be suffered as a result of the injury? Valuation is not a medical issue.

  • Bah, we have no meaningful Constitution as it is. When “interstate commerce” is taken to include non-commercial actions which occur entirely within the boundaries of one state and involve one person or family group, our written Constitution is meaningless. The level of sophistry necessary to get us to this point essentially obviates the amendment process: the Constitution means what we want, or at least what 5 of 9 of us want.

  • True as that might be, Jeff, there are a couple of things that should be considered:

    1) Lawyers will undoubtedly challenge any attempted legislative approach to remove them from the process up to and including a constitutional amendment;

    2) The 9 Supreme Court justices are all lawyers. I think the likelihood of their giving the okay to any solution that takes lawyers out of the process is nil.

  • cynicalone Link

    Mr. Schuler,
    Relating to seventh amendment claims,
    see: National Childhood Vaccine Injury Act
    and Office of Special Masters of the U.S. Court of Federal Claims.

  • PD Shaw Link

    The vaccine act would be an example of what I referred to earlier. We can create a special statutory program that offers more than the traditional common law remedies without a jury. The Vaccine Act doesn’t require the plaintiff to prove negligence to access a fund set aside from vaccine sales.

    Another example would be state worker’s compensation laws. These are usually no fault programs with damage tables. Also, no jury trial because it’s a statutory cause of action, not common law.

    It’s worth considering, but it would require more give and take than simply making doctors the judges of disputes involving doctors.

  • An authoritative Massachusetts Medical Society study found that five out of six doctors admitted they order tests, procedures and referrals — amounting to about 25 percent of the total — solely as protection from lawsuits. Defensive medicine, estimates the libertarian/conservative Pacific Research Institute, wastes more than $200 billion a year.

    Out of curiosity, did any of those studies bother to take the time to determine whether the additional tests uncovered illnesses or injuries that would have remained undiscovered otherwise?

  • PD Shaw Link

    Alex, no.

    The MMS is simply a survey that asked doctor’s “the frequency with which the … tests, procedures, admissions, and consultations were ordered due to concerns about liability.”

    http://www.massmed.org/AM/Template.cfm?Section=Advocacy_and_Policy&TEMPLATE=/CM/ContentDisplay.cfm&CONTENTID=23559

    Krauthammer probably didn’t read this part: “This study is based entirely on self-reported measures whose validity and reliability have not been established. Physicians’ reports of the frequency of defensive practices may have errors due to recall bias. In addition, social desirability may have lead physicians to report higher rates of defensive practices in an effort to bring attention to what they and the Society perceive to be a wasteful and potentially harmful situation.”

  • ELMO Link

    Dave Schuler, you say that Krauthammers version of tort reform world require a constitutional amendment… That is nonsense. What current amendment or current article does Krauthammer’s version presently violate?

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