Liability reform gets nod in Obama proposal after health summit

Washington -- Democrats and Republicans both worry that health care cost increases are not sustainable, but they appear to share little agreement on how to keep health care affordable while maintaining quality, judging by comments at President Obama's health care summit on Feb. 25.

Obama repeatedly probed for bipartisan agreement on health reform issues during the roughly six-hour meeting across the street from the White House, but he found little aside from a shared desire to reduce frivolous medical lawsuits. Republicans at the summit repeatedly told Obama and Democratic leaders to start over on health reform and adopt smaller bills that have bipartisan support.

"Our country is too big, too complicated, too decentralized for Washington to write a few rules about remaking 17% of the economy all at once," said Senate Republican Conference Chair Lamar Alexander (Tenn.).

Obama dismissed the request. "We cannot have another yearlong debate," he said, adding that he suspected starting over might mean doing nothing at all on health care. "Politically speaking, there may not be any reason for Republicans to do anything."

The summit may have been the last chance for Republicans to influence health reform legislation adopted by the House and Senate late last year before Democrats push to enact a final bill, possibly without a single GOP vote. But most of the 17 Republicans at the summit stuck to statements labeling Democrats' health reform bills overambitious and unaffordable.

Obama closed the meeting by saying that he's willing to craft compromises with GOP members in the next few weeks if the two sides can find significant common ground.

"And if we can't, then I think we've got to go ahead and make some decisions, and then that's what elections are for," Obama said. The president on March 3 unveiled a revised version of his comprehensive health reform proposal based on the congressional bills and outlined the pathway he wants Congress to take to adopt it.

In a letter to congressional leaders the day before, Obama outlined his support for four ideas suggested by Republicans during the summit. These are:

• Expanding medical liability alternatives by adding $50 million to a $23 million state pilot project managed by Health and Human Services Secretary Kathleen Sebelius.
• Incorporating a suggestion by Sen. Tom Coburn, MD (R, Okla.), to reduce fraud by employing health professionals to pose as patients and randomly investigate recipients of public health money.
• Considering a call by Sen. Chuck Grassley (R, Iowa) for increased Medicaid physician pay, as long as it's done in a "fiscally responsible manner."
• Clarifying that consumer-directed, high-deductible health plans with health savings accounts would be offered in the health insurance exchanges that would be set up by the Democrats' legislation, based on a suggestion by Sen. John Barrasso, MD (R, Wyo.).

The American Medical Association welcomed some of Obama's proposed revisions. "As we reach the final stage of health system reform, the AMA is pleased that President Obama has offered some additional proposals, including expanding medical liability reforms, raising Medicaid payment rates to improve access to care for vulnerable patients and expanding the availability of health savings accounts," AMA President J. James Rohack, MD, said in a March 3 statement.

Liability reform discussed

Some of the best-received Republican comments at the Feb. 25 summit came from Dr. Coburn. The obstetrician-gynecologist, citing estimates by Thompson-Reuters, said the U.S. health system wastes at least $600 billion a year because of poorly coordinated care, fraud, frivolous lawsuits and a lack of preventive care.

"We know how to treat acute asthma. What we don't do a good job of is preventing children from getting acute asthma," Dr. Coburn said. "We have a system throughout the country where we're encouraging lawsuits that aren't productive for the country, and what they actually do is cause the cost of health care to go through the roof."

Several Democrats, including House Majority Leader Steny Hoyer (D, Md.), said Dr. Coburn was on target. Hoyer and others said Democratic bills would ramp up efforts to combat Medicare and Medicaid fraud and increase access to preventive care.

The AMA and 76 other medical societies wrote a Feb. 23 letter to Obama and congressional leaders imploring them to adopt legislation that reduces unnecessary medical lawsuits. "Defensive medical procedures, prompted by the threat of litigation, add substantial costs for individuals, private and public payers," the letter stated.

Medical liability reform would reduce federal spending on health care by $54 billion over a decade, according to an October 2009 Congressional Budget Office estimate. The analysis is based on a model that, among other provisions, would cap noneconomic damages at $250,000 and impose statutes of limitations for filing lawsuits -- one year after adults' injuries are discovered and three years after children's injuries are found. But Obama repeatedly has said he does not support capping damage awards.

GOP unmoved

Republicans at the summit largely used the opportunity to lay out their fundamental disagreements with Democrats' health reform bills. House Minority Whip Eric Cantor (R, Va.) said GOP members don't want the federal government to mandate a basic level of insurance that everyone must have because they say it would drive premiums and government spending higher.

Obama countered that health reform must provide meaningful coverage to the uninsured and underinsured. State or federal health insurance exchanges in the Democratic bills would set a minimum standard for coverage. Obama acknowledged that this could be more expensive coverage for some, but only because they would drop their existing basic coverage in favor of more comprehensive plans.

"We would definitely reduce prescription drug prices if we didn't have a drug administration that makes sure that we test the drugs so that they don't kill us," Obama said.

But Cantor was not swayed. "We just can't afford this. I mean ... in a perfect world everyone would have everything they want."

After the summit, House Minority Leader John Boehner (R, Ohio) repeated some of the same attacks on the Democratic bills that he used before the summit. Still, Boehner said he saw value in the meeting. "I wouldn't call it a waste of time. It was a good discussion."