In an advertisement for Charlie Dent’s tort reform bill, Bernie O’Hare tries to sneak this whopper past us:
The practice of defensive medicine – when doctors order tests and treatments in order to protect themselves against frivolous lawsuits – is estimated to cost as much as $200 billion annually. Congressional Budget Office (CBO) analyses indicate comprehensive medical liability reform would save the government $54 billion over the next decade and cut national health care spending by 0.5 percent per year. Dent’s leislation will encourage states to adopt effective alternative medical liability laws that reduce the number of health care lawsuits initiated, reduce the average amount of time taken to resolve lawsuits and reduce the cost of malpractice insurance.
The $54 billion annual savings number includes the cost of defensive medicine:
Concerns about reducing the rate of growth of health expenditures have reignited interest in medical liability reforms and their potential to save money by reducing the practice of defensive medicine. It is not easy to estimate the costs of the medical liability system, however. This article identifies the various components of liability system costs, generates national estimates for each component, and discusses the level of evidence available to support the estimates. Overall annual medical liability system costs, including defensive medicine, are estimated to be $55.6 billion in 2008 dollars, or 2.4 percent of total health care spending.
That’s from a Health Affairs study, summarizing the most rigorous research that’s been done on this question to date. If Bernie has seen a better study showing that we really waste $200 billion a year on defensive medicine (4 times as much!), I’d love to know what it is.