HealthLawProf Blog

Editor: Katharine Van Tassel
Concordia University School of Law

Monday, February 17, 2014

Guest Blogger Associate Professor Laura Hermer: Getting Reform Through Reform: “Let’s Make a Deal”

Hermer1Bill Sage and David Hyman offer an interesting proposal in “Let’s Make a Deal: Trading Malpractice Reform for Health Reform,” in last month’s issue of Health Affairs. Traditional tort reform is a perennial issue that will surely arise again during the next medical liability insurance crisis. Rather than wait for that crisis, why not use traditional tort reform now, when we have the luxury to think about it, and use it as a bargaining chip with which to attain other, arguably far more important, systemic concessions from American physicians? We could, they argue, institute traditional liability reforms (hewing, e.g., to California’s MICRA) in exchange for substantial payment and/or delivery reform, such as replacing fee-for-service with bundled, episodic payments and mandating participation in accountable care organizations or other coordinated care delivery models, requiring greater public transparency concerning medical errors, or setting aside opposition to provision of primary care services by non-physician providers. Improvements to payment and delivery systems are not inevitable, and so offering liability reforms would help sweeten the deal.

I wonder, though, if such concessions would be productive. They may indeed yield the results Sage and Hyman hypothesize. Many physicians view MICRA-style reforms as the “gold standard,” and would like to see them instituted nationwide. Such measures have been found by a number of researchers to reduce liability insurance premiums. However, physicians in states that have instituted them or measures like them report that they still worry about lawsuits, even if perhaps less so than physicians in other states. They still practice defensive medicine. And health care costs remain as high as ever.

MICRA-style reforms, in other words, may sound good to physicians but ultimately offer far less than they promise. The reforms suggested by Sage and Hyman, on the other hand, have real potential to improve health care quality and costs, yet at the same time will also likely produce substantial changes in how physicians practice and are compensated – changes that many physicians will likely experience as negative.  It is true that major physician organizations have been quite supportive of changes proposed to the SGR and have expressed support for certain ACA demonstration projects. Yet individual physicians appear more skeptical. According to a 2010 Physicians Foundation survey, for example, a substantial majority of individual physicians expressed negative views about the impact they expected the ACA to have on their workload and earnings, and about specific ACA demonstration projects such as bundled payments. These fears might not be misplaced, as it is quite possible that some of these reforms may result in not only changes in physician revenue and incentives, whether positive or negative, but also, in the worst case, a burdensome bureaucratization of clinical practice and strictures on innovation.

Giving physicians what they want – traditional liability reform – in exchange for payment, delivery, and other reforms won’t likely make them happy, at least not in the long run. Would a genuine possibility for greater autonomy and substantially decreased administrative burdens offer a better route to success? Will we have to wait for a generational change among practicing physicians before we see a more general acceptance, let alone embrace, of reform?

Guest Blogger Associate Professor Laura Hermer

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