The Art of Promoting Savings in Health Care

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In politics, just like in war, success comes not just from anticipating a direct response to your latest move, but also from looking far across the theater for your adversary's counter-measure.

So it was no surprise when, after getting the attention of federal policymakers on the benefits of putting some legal reform into a national health-care package, backers of reform found their own flanks attacked.

"Medical malpractice insurers . . . take advantage of [a federal] antitrust exemption to maximize their profits, to the detriment of doctors who buy their coverage," a group of personal injury lawyer-backed organizations recently told federal lawmakers. "Millions of consumers and their health-care providers would benefit if real competition were restored in the health insurance and medical malpractice insurance markets," a letter from the Consumer Federation of America and others told U.S. Rep. John Conyers (D-MI) in support of H.R. 3596.

What these lobbying groups conceal from their audience when attacking medical professional liability insurance providers, however, is that the overwhelming number of U.S. physicians get their liability protection from companies they themselves own and govern. In California, for example, four major doctor-owned companies actively compete for the bulk of private practice physicians in the state.

These companies, all staunch supporters of the state's landmark Medical Injury Compensation Reform Act, help account for physician liability protection rates that are as much as half of those found in comparable states not protected by MICRA.

Moreover, an analysis by the Congressional Budget Office refutes the lawyer-backed groups' contention that rates for the two types of insurance targeted -- health and medical professional liability -- would fall under H.R. 3596 and its Senate counterpart, S. 1681. "Enacting the legislation would have no significant effect on the premiums that private health insurers would charge," according to the CBO. "[S]tate laws already bar the activities that would be prohibited under federal law if this bill was enacted."

In "The Art of War," Sun Tzu promoted sowing division among one's adversaries. So when advocates of federal medical liability reform showed that a decline in defensive medicine would save billions of health care dollars, they likely knew better than to expect a response on the merits.

But in the end, the trial lawyers' weak attempt to drive a wedge between doctors and the companies that American physicians themselves own and direct betrays a further escalation of their tactics -- to outright deception.

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Gordon Ownby is general counsel of the Cooperative of American Physicians, Inc., www.cap-mpt.com, and can be reached at gownby@cap-mpt.com.