My previous post argued that since they’re never going to be satisfied, you might as well not try to score political points by adopting business’s anti-regulatory agenda.
Medical tort reform—limiting damages in medical malpractice cases—has consistently been touted by conservatives as the best way to reduce the increase in health care costs. It’s their surefire alternative to the Affordable Care Act.
Well, according to this study, that didn’t work in Texas, where a certain governor pushed through “…a comprehensive package of tort reforms in 2003, including a fairly strict cap on non-economic damages.”
It’s rare to have natural experiments like this in economics—other states without these “reforms” serve as the control group—so these findings are worth taking seriously:
“Post-reform, we find no evidence of reduced Medicare spending in Texas relative to these comparison groups. We then compare health care spending in Texas hospital service areas (HSAs) with high med-mal pressure to Texas HSAs with low med-mal pressure. Pre-reform, we find no evidence that Medicare spending was higher in high-pressure HSAs than low-pressure HSAs, and no evidence that spending grew faster in high-pressure HSAs. Post-reform we find no evidence that high-pressure HSAs experienced any change in spending trends, relative to low-pressure HSAs. In sum, we find no evidence that Texas’ 2003 tort reforms ‘bent the cost curve.’”
That doesn’t mean the tort system is perfectly calibrated, but it’s another example of the dominant conservative bait-and-switch strategy: frame your reform as furthering an economic goal—jobs and incomes (supply-side tax cuts, close the EPA); slow the growth of health costs (tort reform)—when the real goal is providing a goodie to a constituent.