Medical malpractice reform in exchange for paying doctors less

The bipartisan debt commission appointed by President Obama recently released its recommendations on how to pare the country’s debt.

Of interest to doctors is the suggestion to change the way doctors are paid.  Physician lobbies have been advocating for removal of the Sustainable Growth Rate formula — the flawed method by which Medicare, and subsequently private insurers, pays doctors.

According to this method, physicians are due for a pay cut of more than 20% next month.

According to the commission,

the plan proposes eliminating the SGR in 2015 and replacing it with a “modest reduction” for physicians and other providers. The plan doesn’t elaborate on what constitutes a “modest reduction” in Medicare reimbursement.

Meanwhile, the Centers for Medicare and Medicaid Services (CMS) should establish a new payment system — one that rewards doctors for quality, and includes accountable care organizations and bundling payments by episodes of care, the report said.

The commission also said in order to pay for the SGR reform, medical malpractice lawyers should be paid less, there should be a cap on noneconomic damages in medical malpractice cases, and that comprehensive tort reform should be adopted.

There’s little question that associating physician reimbursements with the number of tests and treatments ordered is a major driver of health costs. Removing that incentive, and better valuing the time doctors spend with patients, is a positive step in the right direction.

Also note the commission’s strong support for malpractice reform, specifically mentioning caps on non-economic damages.

Earlier this year, surgeon Jeffrey Parks raised the question of whether doctors would take less pay in exchange for strong medical malpractice reform:

You can’t ask doctors of the future to earn less and work more without subsidizing the training and schooling, without addressing the medical malpractice crisis. I’m willing to sit down at the bargaining table.

Now, reform doesn’t specifically have to involve caps — which admittedly would be unfriendly to legitimately injured patients. Immunity for doctors following clinical guidelines — advocated by progressive policy expert Peter Orszag — health courts, or no-fault malpractice are all acceptable alternatives.

A piece of advice to progressives who, in general, want to pay doctors less: offer something in return.

There’s no bigger bargaining chip than legitimate medical malpractice reform. You’ll be surprised at how many doctors are willing to accept that deal.

 is an internal medicine physician and on the Board of Contributors at USA Today.  He is founder and editor of KevinMD.com, also on FacebookTwitterGoogle+, and LinkedIn.

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