Seldom can a president move an audience from applause to boos in a matter of seconds. But President Obama did it last week with three words: "fear of lawsuits."

Thousands of doctors at the American Medical Association convention cheered when Obama said some doctors "feel the need to order more tests and treatments to avoid being ... vulnerable" to lawsuits. The mood quickly turned sour, though, after Obama added that he's "not advocating caps on malpractice awards."

So goes the polarized debate over how to change a legal system that contributes to high malpractice insurance rates, unnecessary "defensive" treatments and an inability to curb far-too-common medical errors. In some states, high insurance rates have helped push doctors to move or stop providing high-risk specialties, such as delivering babies or emergency surgery.

Solving the problem requires the deftness of a surgeon using a scalpel, but it usually gets treated with all the sophistication of a lumberjack wielding an ax.

Doctors, insurers, health care providers and their mostly Republican allies fixate on mandating caps on damages for "pain and suffering," which are granted by juries on top of awards for actual harm. Trial lawyers and their mostly Democratic allies dismiss the malpractice debate entirely. They view caps as an evil conspiracy to harm injured victims, not to mention their own wallets.

The only thing the two sides have in common is that they're both wrong. Doctors overestimate the degree to which lawsuits drive up medical costs (malpractice costs account for less than 2% of all health care spending, according to the Congressional Budget Office). Lawyers underestimate the degree to which even a few outsized verdicts spread fear and influence doctors' behavior.

There are promising solutions to reduce lawsuits, promote better practices and, ultimately, save money, but they are often ignored in the national debate.


For nearly a decade, the University of Michigan Health System has been using a program in which patients report errors to a hospital "risk-management" program before filing suit. The hospital investigates and, if warranted, issues an apology and an offer of compensation to the patient. If the patient turns that down, he or she can go to court. The vast majority settle. The system moves quickly, sometimes catching errors before they're reported.

In August 2001, there were 262 open claims against the medical center. In 2007, the number was 83. Some Michigan lawyers who represent patients praise the system -- quite a testament to its ability to treat injured patients fairly.

Similar systems are proving their worth at as many as 300 hospitals and university medical centers across the country. A few malpractice insurers are using such programs for their insured doctors. In 2005, then-Sens. Barack Obama and Hillary Clinton proposed a law to encourage such systems and build a national database of disclosed errors to help physicians avoid them. This promising measure died in a committee.

Another intriguing idea is specialized health courts, where experienced judges using impartial experts would decide malpractice cases without juries. Awards would be more consistent and quicker. Yet no state has even tried a pilot program.

Unless doctors and lawyers move from the extremes of the malpractice debate, the public will be denied what it wants most -- a reduction in the medical errors that occur all too often.

GRAPHIC: GRAPHIC, B/W, Veronica Salazar, USA TODAY, Source: Journal of Health & Life Sciences Law (line graph)