Report: Liability Reform Can Lower Healthcare Insurance Costs

A recent report from the Congressional Budget Office has found that lowering the cost of healthcare-related lawsuits can save the system billions of dollars, resulting in better priced healthcare insurance for consumers.

The recent report said that by adding a package of tort reform proposals, total U.S. healthcare spending could be reduced by about 0.5 percent, or about $11 billion as of 2009. The CBO also noted that reforming healthcare-related lawsuit awards and related matters could trim $54 billion from the federal deficit in the next decade.

Much of this savings would come in the form of lower medical liability premiums paid by healthcare professionals, with some savings also coming from less usage of some health services. This is because in some cases, providers will order unnecessary tests and procedures for patients based on little more than fear of lawsuits.

"The American Medical Association estimates that medical liability costs are passed along to patients in this country at a price tag as high as $151 billion each year. Unreasonable lawsuits and the absurdly high cost of malpractice insurance are driving up costs for patients and have forced doctors out of practice," said Senator Judd Gregg, a New Hampshire Republican, in response to the report.

Overall, Congress is still weighing a number of proposals that could affect the price Americans pay for their healthcare insurance, although it remains to be seen if this particular issue will be addressed.