Constitutional Contract Law

The 109th Congress took as one of its favorite causes the issue of tort reform, passing legislation that severely limited an injured party’s right to sue and collect damages, and there is an ongoing debate on further restrictions on the ability of people to sue. One thing that is brought up repeatedly is medical malpractice insurance. The rates have skyrocketed, and the Bush administration and former Republican majority in Congress have blamed lawsuits for the rise.

Lawsuits do have an impact on medical malpractice insurance rates. But what Bush and his Republican friends don’t mention is that lawsuits have had only a relatively small effect on the cost of insurance. For the real blame, one has to look elsewhere.

Insurance companies rake in billions of dollars a year from their customers, and then take the money and invest it. When the Enron debacle and other financial scandals hit Wall Street beginning in 2001, insurance companies were invested heavily in the stock market; and when the stock market took a dive, the insurance companies took a bath. Up went insurance rates on just about everything.

I do believe that lawsuits can get out of hand, and that exorbitant damages are sometimes awarded. But rather than restricting access to the courts or putting a mandatory cap on damages, why not take a deeper look?

Some people are motivated to sue simply for monetary gain, but, particularly with medical malpractice cases, others want justice, and to blow the whistle on incompetent or careless physicians. Too often a monetary settlement will occur and then the doctor will go right back to practicing medicine, with no consequences, and with the details of the case buried beneath a nondisclosure agreement.

I’m convinced that many injured parties would be more likely to accept reasonable settlements if they knew that action would be taken against an incompetent physician. Why not tie tort reform, particularly as regards medical malpractice, to an investigation that takes a good hard governmental look at the care and competency of the physicians and other practitioners involved? Why not outlaw nondisclosure agreements when it involves some kind of personal injury? After all, the public’s right to know is surely important on the issue of medical malpractice.

The Congress should also look at the possibility of banning unnecessary delaying tactics used to wear down plaintiffs. These tactics often drag out a lawsuit for years and serve to cause the plaintiffs to give up. If the possibility of sanctions and stiff fines went along with this practice, it might end.

Alternative ways for plaintiffs in malpractice cases to seek justice and receive equitable settlements might cut down considerably on both the frequency and cost of lawsuits.