Introduction

Blaming "junk lawsuits" for driving up doctors' insurance fees, President Bush has urged Congress to pass strict limits on medical malpractice litigation. But while he is correct in considering our medical liability system broken, the president has failed to see the essential problem and has proposed the wrong cure.

The White House, along with a coalition of doctors and insurance companies, wants Congress to cap the non-economic damages that juries frequently award to severely injured patients for emotional pain and suffering. Some of those awards are indeed outrageous and undoubtedly contribute to the soaring malpractice insurance rates that are squeezing all doctors and driving some out of medicine altogether.

Democrats, meanwhile, focus blame for rapidly rising premiums on the malpractice insurance industry. Siding with trial lawyers and some consumer groups, they propose tighter regulation of the industry as the best solution to the malpractice insurance crisis.

But our medical liability system suffers from more fundamental defects: It does not give most injured patients access to justice, and it does not send clear signals about standards of care that would help health care providers avoid medical mistakes.

The headline-grabbing, big-money awards set by juries mask the fact that most patients do not receive any compensation at all for injuries from negligence. According to studies of medical malpractice in several states, only 2 percent of patients injured by negligent care in a hospital file malpractice claims. Elderly and low-income patients, in particular, are even less likely to sue.

Injured patients usually do not know if they are victims of bad care or simply bad luck. Filing a malpractice claim can be an emotional, time-consuming ordeal. It entails confronting your doctor and spending countless hours in acrimonious legal proceedings. Only people with serious injuries and the potential for large awards are likely to find a lawyer to take their case because the legal costs involved are so high. Even for those with a serious injury (a disability lasting six months or more), the malpractice system compensates only one in 14 people.

The problem is not simply a matter of greedy lawyers egging injured patients to sue. It is the inherent difficulty of distinguishing between malpractice and unavoidable injuries. That is the real reason why, for every valid claim, four unfounded claims are filed.

Malpractice law has become so muddled that going to court is like rolling the dice. Juries hear confusing and conflicting testimony from expert witnesses about what constitutes a reasonable standard of medical care in a given situation, and then must decide whom to believe. Judges never tell them what the law is as they would in criminal matters. In the absence of any clear guidelines for determining if doctors are at fault, it is little wonder that jurors often let sympathy for severely injured patients guide their decisions.

Similarly, many doctors do not trust the medical justice system because it makes inconsistent and often incorrect judgments about medical practice. Fearful of being sued, and shaken by mounting malpractice premiums, they often practice a false kind of professionalism -- closing ranks, ordering excessive tests, and shutting down frank discussion about failures and near misses.

Patients have the most to lose under the current system. Without clear signals from the courts about the steps doctors should take to prevent injuries, it should come as no surprise that between 48,000 and 98,000 patients die from medical mistakes in hospitals each year. Patients are also losing access to doctors in high-risk specialties, such as obstetrics, particularly in states where malpractice insurance premiums are rising the fastest. Although many factors have pushed malpractice premiums higher, the biggest problem is the soaring costs of insuring against court decisions that are highly uncertain and lacking in common sense.

Yet, instead of grappling with the medical liability system's fundamental flaws, the political debate has centered on capping jury awards. Republicans say caps on damages for pain and suffering would lower insurance costs and thereby keep doctors from leaving their practices. Congressional Democrats argue that such caps, by making it harder for lawyers to recoup the high costs of pursuing malpractice cases, would deny injured patients access to justice. But Americans should not be forced to choose between access to medical care and access to justice.

The Progressive Policy Institute proposes a Third Way: a new network of specialized health courts that would replace America's broken medical justice system.