The Doctor’s Advocate | Second Quarter 2017
Government Relations Report

Federal Medical Liability Reform: A Historical Perspective

Stephen A. Borg, Vice President, The Keelen Group, and Legislative Advocate in Washington, DC, for The Doctors Company, and Elizabeth Healy, Assistant Vice President, Government Relations, The Doctors Company

In March 2010, the United States Congress passed, and President Barack Obama signed into law, the Affordable Care Act (ACA). It was one of the largest pieces of healthcare legislation that our nation has ever seen. Seven years later, healthcare is again at the center of the political arena in Washington, DC, and the overhaul of the ACA has been a top priority for legislators (both for and against changes) at the beginning of the 115th U.S. Congress.

With the election of Republican President Donald Trump, Republican majorities in both the U.S. Senate and U.S. House of Representatives, and healthcare reform being a top priority of the administration, it seems only logical that medical liability reform at the federal level would be on the agenda. However, major obstacles to the enactment of California- or Texas-style medical liability reform at the federal level remain.

The Doctors Company and the Health Coalition on Liability and Access (HCLA) are poised to take advantage of the spotlight on healthcare and the potential for medical liability reform to be attached to any new legislation going forward. Together, we worked to draft new federal medical liability legislation that places a strong emphasis on retention of state tort reforms already in place, while providing stronger protections for states without tort reform. Both The Doctors Company and the HCLA are working to ensure that medical liability reform is on the agenda for any future major healthcare legislation.

Over the last two decades, the House of Representatives has passed comprehensive federal medical liability reform legislation more than 10 times, only to have the legislation stall in the U.S. Senate every time.

In 1995, the Republican party took control of the House of Representatives and the Senate for the first time in over 40 years. Republicans arrived in Washington, DC, touting their “Contract with America” and quickly began introducing legislation to that end. Included in these “Contract” packages was legislation to enact federal tort reform. Republicans had long favored federal tort reform, but it wasn’t until their historic gains in the 1994 elections that the issue found enough traction to advance in Congress and, in doing so, also provoked serious opposition.

As the Contract with America turned hyperpartisan, tort reform became another wedge issue that pitted generally business-friendly Republicans in favor of it against consumer-protection Democrats—supported by trial lawyers—opposed to it. Medical liability reform, which had long been a bipartisan issue at the state level, got caught in the fray of partisan bickering and soon became a partisan issue at the national level. Because broader tort reform has become a partisan wedge issue at the Congressional level, the many Democrats in Congress who are supportive of medical liability reform at the state level are reluctant to vote for it in Congress.

In nearly every subsequent Congress, House Republicans introduced legislation that was typically based loosely on an expansion of California’s MICRA law. Hopes were high for enactment when Republican President George W. Bush enjoyed a Republican majority in both houses of Congress from 2003 to 2007. But the Republican majority lacked the size and unity to get tort reform passed in the Senate for the president to sign.

Hopes were raised again in 2010 when, in a speech to Congress, President Obama acknowledged that defensive medicine, spurred by malpractice lawsuits, was driving up the cost of healthcare. In light of this acknowledgment, the medical community hoped that medical liability reform would be included in the ACA. But, ultimately, the bill only included funding to study alternative medical liability reforms.

Republicans made massive gains in Congress in the first midterm elections after President Obama’s election, including a new breed of Republican—followers of the “Tea Party Movement.” While Democrats retained a razor-thin majority in the Senate, Republicans held a 242–193 member advantage in the House. With their new majority, House Republicans introduced federal medical liability reform legislation. But this time, they ran into an unforeseen foe within their own party. The Tea Party Republicans preferred to focus on states’ rights and limiting the power of the federal government and on deficit reduction.

As a result, Republicans in favor of federal medical liability reform shifted to focusing on the budget savings potential of liability reform. The Congressional Budget Office estimated that enacting federal medical liability reform would save the federal government more than $50 billion over a decade. That strategy led Republicans to try attaching medical liability reform to legislative packages as a way of offsetting the subsequent costs of those packages.

In 2017, the 115th Congress began with a Republican advantage of 52–48 in the Senate and 241–194 in the House, compared with a 55–45 and 225–208 advantage from 2005 to 2007, the first half of George W. Bush’s second term, when Republicans failed to enact federal medical liability reform. Republicans currently have their second-largest advantage in the House since 1931, but about three dozen of those representatives are members of the House Freedom Caucus, the successors to the Tea Party.

Even with a historically significant Republican domination of the House of Representatives, the passage of tort reform in the House is not ensured. And even if federal medical liability protections are passed in the House of Representatives in the 115th Congress—either as a standalone bill or an attachment to an ACA replacement bill—those protections will face a steep climb in the Senate. None of the House’s medical liability reforms were approved by the Senate when Republicans held a 10-seat advantage from 2005 to 2007, and any reform legislation that is introduced in the Senate will face the highly charged partisan atmosphere around healthcare legislation, making it difficult to gain bipartisan support.

Nevertheless, The Doctors Company will continue to advocate for medical liability reform. Medical liability reform is a proven strategy to reduce medical costs while maintaining access to healthcare and providing fair compensation to injured patients. The Doctors Company will continue to advocate for the practice of good medicine and protect medical liability reform in all branches and all levels of government.

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