Health Rights.am

Health-Care Reform Could Create a Litigation Explosion

FEBRUARY 10, 2010 - President Obama wants to convene a bipartisan meeting later this month to discuss health reform—"to go systematically through all the best ideas out there,” as he said to CBS’s Katie Couric in a pre-Super Bowl interview. 

“How do you guys want to lower costs?” he said he’d ask Republicans.

If he is sincere, the president should consider how the health-care bills his party has on the table right now will drive up the legal costs that are draining the health-care system we currently have.

By creating new federally enforceable rights and obligations, layers of complex federal regulations, and dozens of new programs and agencies—not to mention 50 newfangled “exchanges"—ObamaCare would guarantee a flood of litigation. That means more money wasted on attorney fees, physicians focused on legal rather than medical considerations, and growing delays in our already-overburdened courts.

The first court battles will focus on the constitutionality of requiring individuals to buy health insurance. Assuming the statute survives, subsequent litigation will put Americans’ health in the hands of federal judges who will effectively write health-care policy as they divine the meaning of thousands of pages of statutory language and accompanying regulations.

The sources of litigation will be many, ranging from individual coverage disputes to other constitutional claims explored below. In between, there’s enough vague and ambiguous statutory language to keep lawyers employed for decades. One example: the compromise abortion provision contained in the Senate bill. Fervent disagreement over its meaning presages bitter court fights.

Consider also the legislation’s prohibition of a deductible for “preventive services” recommended by the United States Preventive Services Task Force. The recent firestorm over the Task Force’s mammogram recommendations is but a glimpse of the legal battles that will ensue when such recommendations gain new legal status under the statute.

To implement the legislation currently on the table, federal bureaucrats will necessarily generate thousands of pages of regulations. Under the Administrative Procedure Act, trial lawyers—as well as attorneys for industry, the medical profession, and countless interest groups—will challenge not only the substance of the regulations, but also the procedures used to generate them.

For example, the bills command the Secretary of Health and Human Services (HHS) to “define the essential health benefits” that insurance plans must contain. Imagine the mischief trial lawyers can make by claiming that the resulting regulations fail to fully “take into account the health-care needs of diverse segments of the population,” as the Senate bill requires. Lawyers will also challenge some of HHS’s rule-making as an improper delegation of congressional authority.

The greatest number of lawsuits may come from individuals flexing their new-found right to essential health benefits by challenging insurance companies’ coverage decisions in court after internal appeals are exhausted. The Senate and House bills will inevitably produce, but do nothing to mitigate, an increase in the variety and complexity of such litigation.

Now that the federal government is inserting itself between you and your insurance company, we’ll also see coverage disputes in which the feds are among the defendants. HHS might even wind up as a defendant in medical malpractice lawsuits.

The Constitution applies to government actions, so the feds’ dramatically expanded role in health care promises an explosion of constitutional claims, driven both by financial gain and interest group agendas. Lawsuits claiming equal protection violations will be limited only by the human capacity to feel discriminated against.

Women’s groups will likely sue if HHS requires coverage for erectile dysfunction but not breast augmentation. Gay-rights groups will litigate if they don’t like the way HHS defines “family” for insurance purposes. People 30 and over will file suit because only the young are permitted to purchase catastrophic coverage. Hispanics will go to court if they are disproportionately asked to prove citizenship before receiving insurance subsidies. And white folks will sue because of the various racial preferences in the bills.

Death panels or not, greater federal involvement in health care, including end-of-life care, triggers the constitutional requirement that government afford due process when life is at stake. Liberals who complained about the interference of federal courts in the Terri Schiavo case may wind up regretting their push to federalize health care.

Government intervention also elevates privacy issues to a constitutional level. The bills single out smoking as a justification for higher insurance premiums, potentially raising the constitutional issue of how far federal bureaucrats enforcing the new premium rules can go in determining whether you smoke in your home.

Creative trial lawyers will be aided by those activist judges more interested in making than interpreting the law. The four corners of, say, the Senate bill and its accompanying regulations will be just a starting point for a panoply of judge-made entitlements, “rights,” and federal obligations that will themselves trigger a further expansion of health-care litigation.

“Litigation has several features at odds with sound health policy—including its cost, its hindsight bias, and its adversarial character,” William Sage, Vice Provost for Health Affairs at the University of Texas, warned us seven years ago in the Journal of Health Politics, Policy and Law. Under ObamaCare, health care will become even more costly and adversarial, with patients’ concerns crowded out as doctors focus on avoiding lawsuits and federal investigations, and insurance companies and regulators blame each other for every problem.

And if you think insurance companies take too long to make decisions when lives hang in the balance, just wait to see the delays in patient care caused by the federal bureaucracy and an overburdened court system.

Supporters of the legislation favored by the president and most of his party point to socialized medicine in Europe as evidence that federalizing health care won’t be the disaster that many predict. But European nations are not nearly as litigious as our own. The uniquely American combination of bureaucrats, trial lawyers, and judges running our health-care system will prove more costly and deadly than anyone can imagine.

By CURT LEVEY
Mr. Levey is executive director of the Washington-based Committee for Justice.
WSJ