<DOC>
[108th Congress House Hearings]
[From the U.S. Government Printing Office via GPO Access]
[DOCID: f:91840.wais]
DYING FOR HELP: ARE PATIENTS NEEDLESSLY SUFFERING DUE TO THE HIGH COST
OF MEDICAL LIABILITY INSURANCE?
=======================================================================
HEARING
before the
SUBCOMMITTEE ON HUMAN RIGHTS AND WELLNESS
of the
COMMITTEE ON
GOVERNMENT REFORM
HOUSE OF REPRESENTATIVES
ONE HUNDRED EIGHTH CONGRESS
FIRST SESSION
__________
OCTOBER 1, 2003
__________
Serial No. 108-105
__________
Printed for the use of the Committee on Government Reform
Available via the World Wide Web: http://www.gpo.gov/congress/house
http://www.house.gov/reform
_____
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WASHINGTON : 2004
91-840 PDF
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COMMITTEE ON GOVERNMENT REFORM
TOM DAVIS, Virginia, Chairman
DAN BURTON, Indiana HENRY A. WAXMAN, California
CHRISTOPHER SHAYS, Connecticut TOM LANTOS, California
ILEANA ROS-LEHTINEN, Florida MAJOR R. OWENS, New York
JOHN M. McHUGH, New York EDOLPHUS TOWNS, New York
JOHN L. MICA, Florida PAUL E. KANJORSKI, Pennsylvania
MARK E. SOUDER, Indiana CAROLYN B. MALONEY, New York
STEVEN C. LaTOURETTE, Ohio ELIJAH E. CUMMINGS, Maryland
DOUG OSE, California DENNIS J. KUCINICH, Ohio
RON LEWIS, Kentucky DANNY K. DAVIS, Illinois
JO ANN DAVIS, Virginia JOHN F. TIERNEY, Massachusetts
TODD RUSSELL PLATTS, Pennsylvania WM. LACY CLAY, Missouri
CHRIS CANNON, Utah DIANE E. WATSON, California
ADAM H. PUTNAM, Florida STEPHEN F. LYNCH, Massachusetts
EDWARD L. SCHROCK, Virginia CHRIS VAN HOLLEN, Maryland
JOHN J. DUNCAN, Jr., Tennessee LINDA T. SANCHEZ, California
JOHN SULLIVAN, Oklahoma C.A. ``DUTCH'' RUPPERSBERGER,
NATHAN DEAL, Georgia Maryland
CANDICE S. MILLER, Michigan ELEANOR HOLMES NORTON, District of
TIM MURPHY, Pennsylvania Columbia
MICHAEL R. TURNER, Ohio JIM COOPER, Tennessee
JOHN R. CARTER, Texas CHRIS BELL, Texas
WILLIAM J. JANKLOW, South Dakota ------
MARSHA BLACKBURN, Tennessee BERNARD SANDERS, Vermont
(Independent)
Peter Sirh, Staff Director
Melissa Wojciak, Deputy Staff Director
Rob Borden, Parliamentarian
Teresa Austin, Chief Clerk
Philip M. Schiliro, Minority Staff Director
Subcommittee on Human Rights and Wellness
DAN BURTON, Indiana, Chairman
CHRIS CANNON, Utah DIANE E. WATSON, California
CHRISTOPHER SHAYS, Connecticut BERNARD SANDERS, Vermont
ILEANA ROS-LEHTINEN, Florida (Independent)
ELIJAH E. CUMMINGS, Maryland
Ex Officio
TOM DAVIS, Virginia HENRY A. WAXMAN, California
Mark Walker, Staff Director
Mindi Walker, Professional Staff Member
Danielle Perraut, Clerk
Richard Butcher, Minority Professional Staff Member
C O N T E N T S
----------
Page
Hearing held on October 1, 2003.................................. 1
Statement of:
Hillman, Richard J., Director, Financial Markets and
Community Investment, U.S. General Accounting Office; and
Kathryn G. Allen, Director, Health Care, Medicaid and
Private Health Insurance Issues, U.S. General Accounting
Office..................................................... 5
Thornburgh, Dick, former Attorney General of the United
States and Governor of Pennsylvania; John C. Nelson, M.D.,
MPH, FACOG, FACPM, President-Elect and executive board
member, American Medical Association; Jay Angoff, esq.,
former insurance commissioner, State of Missouri, and
deputy insurance commissioner, State of New Jersey; Sherman
Joyce, J.D., president, American Tort Reform Association;
and Dr. James Tayoun, vascular surgeon and president,
Politically Active Physicians Association.................. 35
Letters, statements, etc., submitted for the record by:
Angoff, Jay, esq., former insurance commissioner, State of
Missouri, and deputy insurance commissioner, State of New
Jersey, prepared statement of.............................. 111
Hillman, Richard J., Director, Financial Markets and
Community Investment, U.S. General Accounting Office,
prepared statement of...................................... 8
Joyce, Sherman, J.D., president, American Tort Reform
Association, prepared statement of......................... 120
Nelson, John C., M.D., MPH, FACOG, FACPM, President-Elect and
executive board member, American Medical Association,
prepared statement of...................................... 44
Tayoun, Dr. James, vascular surgeon and president,
Politically Active Physicians Association, prepared
statement of............................................... 133
Thornburgh, Dick, former Attorney General of the United
States and Governor of Pennsylvania, prepared statement of. 38
DYING FOR HELP: ARE PATIENTS NEEDLESSLY SUFFERING DUE TO THE HIGH COST
OF MEDICAL LIABILITY INSURANCE?
----------
WEDNESDAY, OCTOBER 1, 2003
House of Representatives,
Subcommittee on Human Rights and Wellness,
Committee on Government Reform,
Washington, DC.
The subcommittee met, pursuant to notice, at 2 p.m., in
room 2154, Rayburn House Office Building, Hon. Dan Burton
(chairman of the subcommittee) presiding.
Present: Representatives Burton and Watson.
Also present: Representative Waxman.
Staff present: Mark Walker, chief of staff, Mindi Walker,
Brian Fauls, and John Rowe, professional staff members; Nick
Mutton, press secretary, Danielle Perraut, clerk; Michael
Yeager, minority deputy chief counsel; Sarah Despres and Tony
Haywood, minority counsels; Richard Butcher, minority
professional staff member; Earley Green, minority chief clerk;
and Cecelia Morton, minority office manager.
Mr. Burton. Good afternoon. A quorum being present, the
Subcommittee on Human Rights and Wellness will come to order,
and I ask unanimous consent that all Members' and witnesses'
written opening statements be included in the record. Without
objection, so ordered.
I ask unanimous consent that all articles, exhibits, and
extraneous or tabular material referred to be included in the
record. Without objection, so ordered.
And in the event that other Members attend the hearing, I
ask unanimous consent that they be permitted to serve as a
member of the subcommittee for today's hearing. Without
objection, so ordered.
The Subcommittee on Human Rights and Wellness is convening
today to examine the influence of medical liability insurance
premiums on the access and overall quality of health care that
doctors in the United States provide.
Initially the medical liability system was set up to
protect victims of negligence. Today malpractice litigation is
one of the most feared situations in the medical profession
and, I might add, in other areas as well. Over the past several
years, doctors have experienced a considerable increase in the
cost of medical liability insurance premium rates as a result
of medical malpractice litigation. Between 1994 and 2001, the
typical medical malpractice award increased by an astounding
176 percent to an average of $1 million per court case.
The result has been outrageously high malpractice insurance
premiums for health care providers, which in turn has led to
higher costs for the overall U.S. health care system as well as
reduced access to medical services. In 2001, total premiums for
medical malpractice insurance topped $21 billion, more than
double the amount from 10 years earlier.
These outrageously high liability insurance premiums and
losses have caused many doctors who offer life-saving services
to relocate their practices, change specialties or retire from
medicine altogether, thus limiting patients' access to quality
medical care. Among the many medical practitioners who have
fallen victim to exorbitant medical liability rates, the two
most endangered specialties are OB/GYNs and trauma surgeons,
whose successful execution of their duties often makes the
difference between life and death.
According to a June 9 article in Time Magazine, the medical
malpractice and liability crisis is forcing a growing number of
doctors and medical students to switch from lawsuit magnet
specialties like obstetrics, neurology and pulmonology to
``safer'' ones like dermatology and ophthalmology, in effect
severely limiting the number of doctors willing to perform
high-risk procedures like delivering babies and operating on
spines.
To further illustrate the gravity of this problem, in south
Florida today, where there are no tort reform measures in
place, an obstetrician can pay up to $210,000 a year for
medical liability insurance. In Los Angeles, CA, the home of my
colleague Ms. Watson, and where reforms are in place, that same
physician would only pay $57,000 for that same coverage. That
kind of disparity in premiums is a driving force behind this
increasingly difficult nationwide problem.
And Florida is certainly not the only State in danger of
losing specialized physicians. According to an annual study
released by the American Medical Association, 19 States are
already in a medical liability crisis, and numerous other
States are showing signs that they could be headed in that
direction.
Fortunately, my home State of Indiana is not one of them
and is currently showing signs that the medical liability
crisis sweeping across the country has not arisen in Indiana
because the State legislature has already passed legislation
that would limit doctors' exposures to liability. At this time
our State code does not place caps on noneconomic damages,
which may result in higher medical liability premiums in the
future, and this is the cause of great concern to me and my
Hoosier constituents.
What we have to ask ourselves is this: Is it sound public
policy to require a patient to travel up to double the normal
distance to access health care during an emergency situation
because all of the local doctors in their area have moved out
of State? To help gain perspective on this question, the
subcommittee will hear today from an OB/GYN from Salt Lake
City, UT, and the President-Elect of the American Medical
Association, Dr. John Nelson, who will discuss how exorbitant
medical liability premiums are affecting doctors in the United
States.
In addition, Dr. James Tayoun a vascular surgeon based in
Philadelphia, PA, will testify about his experiences with
medical malpractice premium hikes and how they led him to
create the ``Politically Active Physicians Association,'' a
conglomeration of Pennsylvania doctors who are working together
to address the unfortunate medical liability situation in
Pennsylvania.
In an attempt to address this problem, my colleagues and I
here in the U.S. House of Representatives passed the ``Health
Act of 2003;'' that is, the Help Efficient, Accessible Low-
Cost, Timely Healthcare Act, H.R. 5 in March of this year. This
legislation, modeled after California's tort reform laws, would
place caps on the amounts that claimants can be awarded on
noneconomic damages, pain and suffering, which, according to a
U.S. General Accounting Office report, is what has fueled the
drastic increase in medical malpractice premiums.
Representatives from the GAO are here to share their insights
from the findings of this study on this issue.
Unfortunately our colleagues in the lower body, the
Senate--I will tell you about that later--have yet to pass
similar legislation, leaving thousands of doctors vulnerable to
additional premium hikes.
The subcommittee has the pleasure of having with us today
former U.S. Attorney General and the former Governor of the
State of Pennsylvania, the Honorable Dick Thornburgh with us.
He is here to provide insight into how the medical liability
crisis is adversely impacting his home State and other areas of
the country, as well as to address the need for tort reform.
Mr. Sherman Joyce, the president of the American Tort Reform
Association, is also on hand to discuss possible solutions to
this problem.
Nationwide tort reform measures could go a long way toward
helping slow the increase of liability insurance premium costs.
According to a Department of Health and Human Services report
released on July 24, 2002, it is estimated that by putting into
place common-sense liability reforms, such as placing
reasonable limits on noneconomic damages, annual health care
costs in the United States could be reduced by 5 to 9 percent.
That doesn't sound like much when you put it in percentages,
but that could save the Federal Government $60 to $108 billion
a year. And with the problems we are facing with the
prescription drug issue and Medicare, that would go a long way
toward helping to solve those problems.
I believe it is one of our highest duties as Members of
Congress to strive to find the best possible public policy
solutions for ensuring all Americans access to the highest
quality health care system in the world. It is my sincere hope
that the information shared today will inspire our friends in
the Senate and our counterparts in the State legislatures to
pass common-sense legislation to help alleviate some of the
burdens of medical liability on our Nation's physicians while
at the same time protecting the overall quality of the American
health care delivery system. And with that, I will be happy to
yield to my colleague Ms. Watson.
Ms. Watson. I want to sincerely thank the chairman for
addressing the issue and holding the hearing. We are here today
to get to the truth. And the question for me is do increased
medical malpractice insurance costs restrict patients' access
to care?
During my 17 years in California as Chair of the Senate
Health and Human Services Committee, I listened to doctors from
all over the State. Now, from those that I heard, the No. 1
complaint was about the for-profit HMOs making business
decisions and forcing doctors to conform.
In order to have meaningful legislation regarding tort law,
we need to understand the facts. We need to listen to both the
doctors and the victims and then request full disclosures from
the middleman, the insurance companies.
Mr. Chairman, this hearing is very important in an effort
to uncover the truth. A few days ago some folks representing
tort reform made an attempt to undo GAO's findings by having a
group supporting insurance--insurers--the Alliance for Health
Care Reform released a study based on the same faulty
statistics the GAO identified in its August report. Congress
and the American public should not be deceived. We want to look
at the facts, then work to address the high cost of health care
and health insurance in a framework of being behind quality
health care delivery.
Now, I know those who support tort reform want to cap
medical malpractice noneconomic damage awards. Placing a cap on
noneconomic damages will affect an injured patient's ability to
cover losses by confusing the debate. Any limit on noneconomic
damages has a disproportionate impact on low-wage earners, who
are more likely to receive a greater percentage of their
compensation in the form of noneconomic damages if they are
injured. Proponents of medical malpractice liability reform
attempted to place an arbitrary cap on the amount of money an
injured patient could be compensated via H.R. 5 earlier in this
Congress.
Chairman Tauzin requested that GAO study and report on
whether or not the high cost of medical liability insurance is
affecting patients' access to care. The GAO's response was a
resounding no. It is a tragic and unfair fact that minorities
are frequently forced to bear a disproportionately large share
of America's health and safety problems. Unfortunately, so-
called tort reform proposals that would provide wrongdoers
greater immunity for their misconduct also have the impact of
severely weakening the protections and rights afforded to these
different minorities in our country.
So, Mr. Chairman, I look forward to the testimony of all
the panelists, and I'd like to get down to what is affecting in
actuality the skyrocketing medical malpractice insurance rates.
Doctors, victims and every American will benefit from us
getting to the truth. I yield back and thank you, Mr. Chairman.
Mr. Burton. Thank you, Ms. Watson.
[Note.--The GAO reports entitled, ``Medical Malpractice,
Implications of Rising Premiums on Access to Health Care,'' and
``Medical Malpractice Insurance, Multiple Factors Have
Contributed to Increased Premium Rates,'' may be found in
subcommittee files.]
Mr. Burton. I appreciate all of our witnesses being here
today. I know you probably have other things that are important
to do, but as Ms. Watson said, this is a very important issue
to discuss.
Our first panel, and I wish you would come forward, is
Kathryn G. Allen. She is the Director of Health Care for
Medicaid and Private Health Insurance Issues, with the General
Accounting Office; and Richard J. Hillman, Director of
Financial Markets and Community Investment, with the U.S.
General Accounting Office. Would you stand, please, and be
sworn.
[Witnesses sworn.]
Mr. Burton. Being a gentleman, which sometimes is
questioned, I will start with. Ms. Allen.
Ms. Allen. Mr. Chairman and Ms. Watson, we have agreed
between the two of us that Mr. Hillman will give our short
statement, so I defer to him.
Mr. Burton. I tried.
STATEMENT OF RICHARD J. HILLMAN, DIRECTOR, FINANCIAL MARKETS
AND COMMUNITY INVESTMENT, U.S. GENERAL ACCOUNTING OFFICE; AND
KATHRYN G. ALLEN, DIRECTOR, HEALTH CARE, MEDICAID AND PRIVATE
HEALTH INSURANCE ISSUES, U.S. GENERAL ACCOUNTING OFFICE
Mr. Hillman. Mr. Chairman and Ms. Watson, the GAO's pleased
to be here to discuss the results of two recent work efforts.
I led an effort by our Financial Markets and Community
Investment Team to determine the reasons behind recent
increases in some medical malpractice rates. Kathy Allen, to my
left, led an effort by our Health Care Team to assess the
implications of rising premiums on access to health care. Both
efforts resulted in separate reports on these subjects, and we
are pleased with your permission that these full reports are
entered into the record of the hearing.
Our testimony today summarizes these efforts and, as
requested, focuses on, one, the factors that have contributed
to the recent increases in insurance premium rates; and, two,
the differences in rates amongst States that have passed
varying levels of tort reform laws. In summary, we found that
multiple factors have contributed to recent increases in
premium rates in the seven sample States that we reviewed, but
losses on medical malpractice claims, which make up the largest
part of insurers' costs, appear to be the primary driver of
rates in the long run.
We also found that nationwide premium growth has been lower
on average in States that have enacted tort reform with
stricter caps on noneconomic damages than on States with more
limited reforms. Since 1999, medical malpractice premium rates
for physicians in some States, but not all, have increased
dramatically, but before I get into the factors that
contributed to these increased rates, it is important to
understand that both the extent of the increases and the
premium levels themselves vary greatly not only from State to
State, but across medical specialties and even among areas
within States.
For example, the largest writer of medical malpractice
insurance in Florida increased premium rates for general
surgeons in Dade County by approximately 75 percent from 1999
to 2002, while the largest insurer in Minnesota increased
premium rates for the same specialty by only about 2 percent
over the same period. The resulting 2002 premium rate quoted by
the insurer in Florida was $174,000 a year, this being more
than 17 times the premium rate quoted by the insurer in
Minnesota. Moreover, even within Florida, the rate quoted by
the same insurer for the same coverage for general surgeons
outside Dade County was $89,000 a year, or about half the rate
quoted inside Dade County.
Moving on to our first objective on the factors
contributing to the premium rate increases, we found there were
multiple factors. First, since 1998, insurers' losses on
medical malpractice claims have increased rapidly in some
States. While we found that the increased losses appear to be
the greatest contributor to the increased premium rates, a lack
of comprehensive data at the national and State levels on
insurers' medical malpractice claims and on the associated
losses prevented us from fully analyzing the composition and
causes of those losses.
Second, from 1998 through 2001, medical malpractice
insurers experienced decreases in investment income as interest
rates fell on bonds that generally made up around 80 percent of
these insurers' investment portfolios. While almost no insurer
experienced net losses on their investment portfolios over this
period, a decrease in investment income meant that income from
insurance premiums had to cover a larger share of their costs.
Third, during the 1990's, insurers competed vigorously for
medical malpractice business, and several factors, including
high investment returns, permitted them to offer prices that in
hindsight did not completely cover the ultimate losses that
some insurers experienced in that business. As a result some
companies became insolvent or voluntarily left the market,
reducing the downward pressure on premium rates that had
existed throughout the 1990's.
Fourth, beginning in 2001, reinsurance rates for medical
malpractice insurers also increased more rapidly than they had
in the past, raising insurers' overall costs.
In combination, each of these four factors have contributed
to the movement of medical malpractice insurance market through
what are called hard and soft phases similar to the cycles
experienced through property casualty insurance markets as a
whole, and premium rates, therefore, had fluctuated upward or
downward as the phases predicted.
In an attempt to constrain increases in medical malpractice
premium rates, States have adopted various tort reform
measures. Of particular focus recently have been--tort reform
measures have included placing caps on monetary awards for
economic damages such as pain and suffering that may be paid to
plaintiffs in a malpractice suit.
Available data, while somewhat limited in scope, indicate
that rates of premium growth have been slower on average in
States that have enacted tort reforms that include noneconomic
damage caps than in States with more limited reforms. Premium
rates reported by three specialties, general surgery, internal
medicine and OB/GYN, were relatively stable on the average in
most States from 1996 through 2000 and then began to rise,
although more slowly for States with certain noneconomic damage
caps. For example, for 2001 through 2002, average premium rates
rose approximately 10 percent in the 4 States with noneconomic
damage caps of $250,000, but rose approximately 29 percent in
States with more limited tort reforms.
As we have discussed, premium rate increases are influenced
by multiple factors, and our analysis did not allow us to
determine the extent to which these differences in the average
rates of increases at the State level could be attributable to
tort reform laws or to other factors.
In conclusion, Mr. Chairman, as we have discussed, multiple
factors have contributed in recent increases in premium rates
across the States and across specialties. Tort reforms,
particularly those that limit noneconomic damages, have
frequently been proposed as a means of controlling increases in
medical malpractice insurance premium rates. These reforms and
other actions, to the extent that they are effective in
reducing insurers' losses below what they otherwise would have
been, should ultimately slow the increase in premium rates if
all else holds constant. However, any evaluation of effective
tort reforms, insurance cycles or other factors in premium
rates require sufficient data. In order for Congress and others
to better understand conditions in the medical malpractice
market and the effects of the actions that have already been
taken or will be taken, better data needs to be collected,
including more comprehensive data on insurers' losses, jury
verdicts in malpractice cases, and conditions in the health
care sector that might affect the incidence and severity of
medical malpractice suits.
Mr. Chairman, this concludes our prepared remarks, and
Kathy and I would be pleased to answer any questions you or
other Members may have at the appropriate time.
[The prepared statement of Mr. Hillman follows:]
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Mr. Burton. Mr. Hillman, I find it a little troubling. I
was an insurance underwriter for a casualty company at one time
in my previous life, and I was also an insurance agent, and the
losses that insurance companies, whether they are medical
malpractice companies or casualty companies, is pretty much
open. And you indicated that there needed to be more research
to get these--this information. If GAO did this study, I can't
understand how they couldn't have found the information
regarding these losses and be able to very quickly figure out
what the problem is.
I mean, insurance companies use what they call a loss and
expense constant. The loss plus the expenses of taking care of
the administrative parts of settling claims and paying the
overhead for clerical workers and so forth, plus a small margin
for profit, is how they figure out what their costs are and
what the premium should be. And when I was an underwriter early
on, they didn't figure outside income as part of the overall
equation. Either you made money from the insurance risk, or you
didn't. And if you didn't make money, you had to raise the
rates. And if you made money, you lowered the rates. That's why
we had State insurance commissioners that dealt with these
things.
But the question I have for you, why is it, if GAO did a
thorough study on this, why couldn't they have looked at this
information that the insurance companies have to find out
whether or not there was another problem besides the need for
tort reform?
Mr. Hillman. Well, we did, chairman, look at the data that
was made available to us from the National Association of
Insurance Commissioners, and you are right, we have available
to us some national data of what is happening across the
medical malpractice insurance itself with both paid losses,
those losses that are incurred in the year under review, as
well as incurred losses being those losses that they expect to
incur over the next period and some adjustments that might take
place. And I have a chart that I would like to show you that
shows what is happening with paid losses and incurred losses
since 1975 through 2001.
Mr. Burton. I probably should have those reduced. I don't
want this young man breaking his back moving those things
around.
Mr. Hillman. A copy of this is also shown in figure 1 in
our prepared statement, if you would like to see a copy in
front of you. But what we have here shown in the blue lines are
the paid losses that are being incurred in the medical
malpractice insurance market nationwide adjusted, using the CPI
in 2001 dollars for 1975 through 2001. The bars going up
reflect the incurred losses. Those are the losses the insurers
anticipate--may anticipate within the next year or so plus
adjustments from prior periods.
Mr. Burton. So they set up a reserve for those losses, and
that reserve is figured into the overall equation?
Mr. Hillman. That's correct, sir.
Mr. Burton. Well, the answer, according to your research, I
presume, and yours as well, Ms. Allen, is that we need to come
up with some kind of a tort reform formula that's fair to the
lawyers, the patients who have been damaged and the doctors.
That sounds like a Gordian knot that needs to be chopped in
two. Can you give me an equation to solve that problem?
Mr. Hillman. I wish I had the silver bullet, and I am sure
most others do as well. When you look at premium rates in the
insurance industry, the Congresswoman wanted to get to the
facts. Well, the facts as we understand them are paid losses
and incurred losses are the primary driver of those rates. If
Congress wants to do something to reduce medical malpractice
premium rates, we need to look at those paid losses. There's a
couple of ways of addressing them.
Mr. Burton. Paid plus incurred.
Mr. Hillman. Paid plus incurred.
Incurred losses for the 15 largest insurance underwriters
that we visited and talked to, which comprise about 64 percent
of the marketplace in medical malpractice insurance, incurred
losses are about 80 percent of their total expenses. So you
really need to look at incurred losses. And in medical
malpractice what you need to do is look at frequency of claims,
look at severity of claims. Addressing frequency of claims,
tort reform, effective tort reform--looking at severity of
claims, effective tort reform could address that by reducing
jury verdicts and not putting caps on noneconomic damages.
That's one side of the equation. Another side of the equation
would be the frequency, looking at the patient care, doctors
quality of care and trying to come up with solutions to address
the frequency of claims.
Mr. Burton. I am going to let Ms. Watson ask questions, but
let me make one more statement. I presume from your studies
that there's no doubt that you are going to continue to have
the flight of doctors from States that don't do something to
deal with the exorbitant premiums they have to pay. And if that
continues to happen, those States that don't enact some kind of
reforms that are going to deal with this problem are going to
see fewer doctors and higher medical costs in all probability,
and a lowering of the quality of health care, which means a
lowering in the quality of life for those who need help. So the
bottom line, we got to do something about it, right?
Mr. Hillman. I agree. Problems in some States are very
severe, and while States have done what they can do to
implement their own reforms, they aren't all the same, and
therefore you are seeing some States continuing to have large
problems while other States are moderate.
Mr. Burton. You are making the case that we need some
Federal legislation.
Mr. Hillman. A national system seems to be one of the best
ways to curb that problem.
Mr. Burton. Ms. Watson.
Ms. Watson. Thank you, Mr. Chairman.
And we don't take what you have presented to us lightly. I
do appreciate you looking across the spectrum.
In the State of California where we have started on some
tort reform, we also, in my tenure, established the department
of an insurance commissioner, because there are three major
players in all of this, the health delivery system, the doctors
and so on, the insurance company and those they insure. And our
goal, as I said in my statement, is to be able to provide
quality health care, to have the patients' trust in the kind of
health care they receive, and be able to petition when they are
injured. And we want to be fair to all in that. We have no
intent to want to run our medical providers out of business and
out of this State. We have no intent to say to an injured
individual that you cannot be compensated. We certainly don't
want to say to their attorneys that you have no role to play.
So when I say what is the truth, I ask this question. I
think you mentioned that the National Insurance Association--
that might not be the accurate and complete title--provided you
with information, but are you able to see--do they open up
their whole profile of their actuarial data? Do you see that?
And it varies from State to State. And until we can get a hand
on what's happening in California or what's happening in
Florida or Texas, it's going to be very difficult for us to
fashion a Federal standard because we've got to take into
account the various factors that are present in a particular
State.
For example, with our large population of 35 million and
growing per day, we are finding people come in with very, shall
I say--well, they suffer from a lack of health care when they
immigrate into the State of California, Pacific Rim, and those
who are older come there and they demand certain kind of
treatments, and they are very fragile. And so we have to take
in all those factors as we look at malpractice insurance. And
so I think actuarial data is essential for you who are looking
at the numbers and trying to come up with some results and
advise us. So were you able to get into actuarial data?
Mr. Hillman. The National Association of Insurance
Commissioners does not collect actuarial data that would allow
you to assess those on a State-by-State basis.
Ms. Watson. Thank you, because that goes to the point I was
making, that it has to almost be a State-by-State look. You
know, we very seldom have a clear picture of why the premiums
were raised, and we have had these debates over a period of
years, I mean decades, and I held many of those hearings. And
it's not quite clear. But we have an insurance commissioner
that is looking into these issues. And I just want to say that
as we look at this problem, tort reform is not the only answer,
and as we seek the truth in this subcommittee, I appreciate you
coming with your testimony today. And, Mr. Burton, thank you
for the opportunity.
Mr. Burton. Let me just ask one more quick question to
followup on what Ms. Watson was asking. When you talk to the
National Association of Insurance Commissioners, did they
indicate to you that there was any problem in getting the data
from the insurance companies?
Mr. Hillman. Well, data that they collect really isn't
designed to help look at this problem that Congress is faced
with. What they're really looking for is data on the solvency
of companies, making sure that they have sufficient income to
pay claims associated with insurance.
Mr. Burton. Right. But in the process of making sure that
the companies are solvent, they have to look at the records on
loss and expense of that company. Now, they keep records, those
companies do, on the losses. Now, my question is was there any
indication that the insurance companies were trying to keep
that information from you, or the Federal--National Association
of Insurance Commissioners, to try to hide something?
Mr. Hillman. No. No. Not at all. We received excellent
cooperation from the National Association of Insurance
Commissioners as well as a wide range of industry participants,
insurance regulators, medical and legal and trial attorney
associations. All were very candid with us to try to help us
understand what was happening here.
From a data limitation standpoint, though, what we were
looking for and unable to find was data on severity and
frequency of claims at the insurer level on a State-by-State
basis. This information simply did not exist. What the NAIC has
is aggregate data that shows you the total loss portfolio and
premium income picture, what you expect from an investment
return standpoint, what your marginal profit might be
associated with those estimates to give you some sense of
solvency of the institution, and that is what they rely on. To
break it down on a line of insurance business which would break
out information showing frequency of claims at the policyholder
level, severity of those claims is the type of data that we
would like to have in order to better evaluate what's going on
here.
Mr. Burton. Well, does GAO have the ability to subpoena
documentation like that and information like that?
Mr. Hillman. No, Congressman. As a matter of fact, GAO's
audit authority primarily goes to the Federal agencies that
implement the Federal programs in the executive branch. In the
insurance industry there is no Federal agency--individual State
regulators, and we have no direct access to compel them to
provide us information.
Mr. Burton. Each State has an insurance commissioner.
Mr. Hillman. Correct. And they cooperated with us to the
extent they can.
Mr. Burton. I was on the committee that dealt with our
insurance commissioner when I was on the State legislature in
Indiana. We had no problem whatsoever of getting information on
insurance companies and the ratemaking procedures they used.
And it just seems to me that if the GAO--and we may ask you to
do this--if they talk to each individual State, there are 50 of
them----
Mr. Hillman. Correct, four territories.
Mr. Burton. Check them out, too, but if you talk to each
individual State, and that would be a big job, no question
about it, I think you could get the statistical data you
require in order to make some kind of an assessment like that,
because I think it's very, very important that we have all the
facts before we conclude this thing, because you're going to
get from insurance companies one picture, and you are going to
get from the doctors another picture, from the victims another
picture, and from the trial lawyers another picture. And the
only way we are to be able to come up with a formula that is
going to be fair to everybody is to get that statistical data
compiled, and if you can't get it from the National Association
of Insurance Commissioners, you're going to have to get it from
each individual State. And I know it's there. You can get it.
You just have to ask for it.
Ms. Watson.
Ms. Watson. Mr. Hillman, I want to commend you because I
think you put your finger on your problems, and I appreciate
the Chair being able to identify where the problems really are.
We understand your relationship to your Federal Government,
but when it comes to States, because we have had plenty of
trouble with our insurance commission and commissioners in the
State of Florida--I won't tell you about the horror stories in
terms of earthquake insurance. And I know that you are just
stumped, because you have no way of getting that information.
And so this is just the beginning, Mr. Chair, of trying to
look at what we can do from a Federal level. But if the GAO had
to tap into every 1 of the 50 States and territories, this
would be an endeavor that would take over a period of years,
because there's a cost to it as well, and it's very time-
consuming, and I don't think you are going to get the kind of
cooperation out of some States as you would out of others and
out of the Federal department, because you're going into the
private insurance companies' confidential records.
If you asked to open your actuarial data file, I don't know
if you're going to get the kind of cooperation, because it
might be a bad investment somewhere else that you're going to
pay for as an end result through premiums. So I'm just
suggesting that if we want you to do this, we are going to have
to be sure there are resources there, and that there is
personnel there, and you have the time to do it.
Mr. Hillman. Quite frankly, in addition to insurance data,
which is sorely needed to better understand what is going on
with premium rate increases, there's also data that's needed in
the legal system and medical system. Data on settlements and
trial verdicts, breaking out information between economic and
noneconomic damages, largely also not available, judgments on
amounts obtained at trial are reported, sometimes very large
amounts, and insurers told us, however, that most often they do
not pay those amounts beyond policy limits. So data on the
final amounts an insurer pays on individual judgments is not
being publicized or available, and it ends up what the insurers
end up having to pay on these highly publicized claims.
Mr. Burton. What's the answer, then, for the Federal
Government if we're going to try to pass a bill that would
augment what the States are trying to do, or where those States
have not done something, you know, solve the problem? And I
rather this be done by individual States, but the States aren't
doing it, and you are having the flight of doctors out there.
It seems to me something has to be done. You can't let the
health of one segment of the country just go down the tubes
because the price of insurance is too high. So what do you
think the answer is if it's difficult to get this information?
Seems like you could work with the State insurance
commissioners to get this, but assume that you can't. What do
you think the answer is?
Mr. Hillman. Well, I go back to our major finding as shown
in this table that I have presented in figure 1 of my written
statement for the record. The major contributing factor to
increasing premium rates in the medical malpractice insurance
market today appears to us to be paid and incurred losses. And
looking at how to reduce those at the insurance level may give
us some hope in helping to ferret out how best to reduce those
rates. In doing so we need to look at the frequency of claims
and the severity of claims at the insurance line level and a
State-by-State basis and each insurer to better understand what
is happening in those States, what types of measures they have
in place to combat that problem--many States have many
different things going on out there--and assess which among
those things are working best.
You're right, that is a herculean task. What we have done
as part of this review was identify those factors. Interest,
investment income, paid losses, reinsurance rates that insurers
have to pay to level out their risk are the major contributing
factors to the premium rate increases.
Mr. Burton. We may wrestle with this further and try to get
back to you with a request to augment what you have already
done.
Mr. Hillman. We would be pleased to do so.
Ms. Watson. When the Chair asked the question what can we
do, and I was thinking ahead of that as a herculean task, maybe
we can at the Federal level ask the States to report on what
steps they are taking. I represent a district where we were
red-lined, and we found out that there were gangs out there who
were faking accidents, you know, running into the backs of
people and having people making claims and so on. And you know,
so premiums went up. We were red-lined because the accidents
happened in the district.
I think back to when I was in Okinawa they would say,
``Muchie too accident in the area.'' We had the ``muchie''
accident area. People going down to, say, Orange County had
their accidents, you know, in our area, and then our premiums
went up. That is on the automobile insurance side.
So there are all kinds of factors within a State that we
have to look at. And maybe we can put, you know, the mandate,
Mr. Chairman, on the States to start looking at all of these
factors, not just the insurance section, but the legal section
as well as the victims in all of the kinds of con games that go
on as well.
It would be frightening to think that medical malpractice
insurance was growing because the professionals were practicing
faulty medicine. I mean, that would be a very frightening
thing.
But as you were testifying, I was thinking that we had a
case where the chair of business and professions was giving
these doctors coming from other countries reciprocity and
collecting 25,000 for each one he got out of his committee. I
was on his committee, and he would come to my name and he would
say, Watson, aye, and I didn't open my mouth, and out would go
the bill. And this guy would be practicing without taking the
boards. He ended up in prison, of course, this member.
But I'm just saying, each State has its own set of
problems, and there's no way that, from a Federal level, you
could impact or affect that. We are not ready for that. But
what you can do is see that each State is making strides to
look at the issue.
Mr. Hillman. Your remarks are very consistent with where we
came out in our report that we had done. We included matters
for congressional consideration which says that Congress may
wish to consider taking steps to ensure that additional and
better data are collected. Specifically Congress may want to
consider encouraging the NAIC and State insurance regulators to
identify the types of data that are necessary to properly
evaluate the medical malpractice insurance market, specifically
the frequency, severity and the causes of losses, and begin to
collect these data in the form that would allow for appropriate
analysis. That's essentially what we were saying as well.
Mr. Burton. We have been joined by the ranking member of
the full committee Mr. Waxman. Do you have any questions?
Mr. Waxman. Thank you very much.
Medical malpractice insurance premiums have risen
dramatically for some health care providers in some parts of
the country. That much seems to be clear. But there has been a
great deal of debate and great deal of miscellaneous
information about the causes of these premium hikes and impact
they have had on access to health care.
Some of my colleagues on the other side argue that greedy
trial lawyers and runaway juries are the sole cause of a
rampant problem around the country, and they have argued we can
solve this problem by imposing drastic national limits and the
ability of courts and juries to decide which malpractice claims
have merit and which do not.
I don't think that view is supported by the facts, and I am
glad GAO is here to set the record straight.
I have a few questions about what GAO found in its two
recent reports on this subject. GAO found that there wasn't one
single cause with multiple factors that cause premium increases
for some physicians in some States; is that correct?
Mr. Hillman. That's correct.
Mr. Waxman. And they included insurance company
competition, particularly in the soft market of the 1990's to
cut rates and win a greater share of the physician market; is
that correct?
Mr. Hillman. That's correct.
Mr. Waxman. Another factor is the rising cost of
reinsurance rates, correct?
Mr. Hillman. That's correct.
Mr. Waxman. And the remaining factor you cite is the
increase in insurer losses; is that correct?
Mr. Hillman. That's correct. We believe that is one of the
major contributing factors in increases in premium rates.
Mr. Waxman. On increasing insurer losses, GAO reported that
it lacked comprehensive data that would allow you to analyze
claims severity or show how losses were broken down between
economic and noneconomic damages; is that correct?
Mr. Hillman. Yes.
Mr. Waxman. GAO could not conclude and did not conclude
that runaway jury verdicts would cause an insurance crisis
throughout the country; is that a correct statement?
Mr. Hillman. We weren't asked to evaluate that, but what we
identified were major factors that contributed to increases in
premium rates.
Mr. Waxman. Seems to me if runaway jury verdicts aren't the
main problem, that we have no business in imposing national
limits on the ability of injured victims to bring claims to
court. GAO reports that this problem is as much about the
business of insurance as it is about the rising cost of claims
and legal defense, and that is the subject better left for the
States to address. After all, States have always had the
responsibility for regulating the business of insurance through
licensing professionals, for establishing appropriate standards
of care, and for punishing professional misconduct by health
care providers. They are in a far better position than Congress
here in Washington to say, we know what's best for everybody,
and to impose one-size-fits-all solutions to address the
problem. That is pretty complicated and has different aspects
to it.
Thank you very much, Mr. Chairman.
Mr. Burton. You sound a little bit like a Republican when
you talk about States rights.
Mr. Waxman. Strom Thurmond took that very same position on
a lot of issues, but on this issue he saw that this was a
States rights issue.
Mr. Burton. I think it is a States rights issue, what kind
of guidance the Federal Government might give to the States
that aren't responding to this problem and maybe encourage in
some way to get on with it. In 1974, you worked on this bill
that dealt with this.
Mr. Waxman. That is not correct. I chaired the Select
Committee on Medical Malpractice for the California State
Assembly, and many of the recommendations that we put forward
were put into the what is called microlegislation, and
microlegislation was adopted after I came back to Congress, and
I didn't have an opportunity to vote one way or the other.
Mr. Burton. Were your recommendations made in 1974?
Mr. Waxman. They were made in 1974, which is the year I was
elected in Congress. The bill was adopted in 1975. So I was
already back here. But I thought we played a constructive role
in making our recommendations.
And I think California law is one of the many States that
we try to emulate, and sometimes they have adopted it in toto,
and sometimes they decided other strategies, because I think we
have had a view that democracy is at the State level, and I
don't think they need us to give them guidance. But I don't
think they need Washington to tell them what to do on an issue
like this, particularly where it is not so clear-cut as the GAO
reports out, that this is a more complicated problem than the
glib answer of this is the solution, because this is the only
reason those insurance rates are going up. That is the point I
wanted to make.
Mr. Burton. Thank you. I think that your reports are very
well done and might ask you to do a little bit more, as I said
earlier. And with that, we'll excuse you and get back to you
later. Thank you very much.
Our next panel is our good friend, the Honorable Dick
Thornburgh, who was the Attorney General of the United States
from 1988 to 1991 and the Governor of Pennsylvania from 1979 to
1987; as well as Dr. John C. Nelson, President-Elect and
executive board member of the American Medical Association; Mr.
Jay Angoff, former insurance commissioner for the State of
Missouri; Mr. Sherman Joyce, president of the American Tort
Reform Association, and Dr. James Tayoun, who's a vascular
surgeon and president of the Politically Active Physicians
Association, I believe of Pennsylvania, if I'm not mistaken; is
that correct?
Mr. Tayoun. Correct.
Mr. Burton. OK. Very good. Have a seat.
Would you please rise? Our custom is to swear everyone in,
so would you raise your right hands.
[Witnesses sworn.]
Mr. Burton. In deference to our former Attorney General,
I'd like to start with Mr. Thornburgh.
How are you?
STATEMENTS OF DICK THORNBURGH, FORMER ATTORNEY GENERAL OF THE
UNITED STATES AND GOVERNOR OF PENNSYLVANIA; JOHN C. NELSON,
M.D., MPH, FACOG, FACPM, PRESIDENT-ELECT AND EXECUTIVE BOARD
MEMBER, AMERICAN MEDICAL ASSOCIATION; JAY ANGOFF, ESQ., FORMER
INSURANCE COMMISSIONER, STATE OF MISSOURI, AND DEPUTY INSURANCE
COMMISSIONER, STATE OF NEW JERSEY; SHERMAN JOYCE, J.D.,
PRESIDENT, AMERICAN TORT REFORM ASSOCIATION; AND DR. JAMES
TAYOUN, VASCULAR SURGEON AND PRESIDENT, POLITICALLY ACTIVE
PHYSICIANS ASSOCIATION
Mr. Thornburgh. Fine, Mr. Chairman.
Thank you very much for the invitation to speak with you
today about a topic that I think is important to not only those
present, but to all Americans. I want to emphasize that I
appear here today as a representative of no one save myself.
It's because of my longstanding interest in civil justice
reform that dates back to my service as Governor and as
Attorney General.
We can all agree, I think, that there's a significant
problem with increasing rates for medical malpractice
insurance. My home State of Pennsylvania is one of the hardest
hit. Just this past summer the GAO report noted that cash
payments by insurers to medical malpractice plaintiffs in
Pennsylvania jumped more than 70 percent between 1998 and 2002,
a 5-year period.
Doctors in Pennsylvania pay malpractice insurance premiums
that are sharply higher than the national average. A number of
major insurance carriers have failed and others have opted out
of insuring doctors or have refused to issue new policies. The
Pennsylvania Department of Insurance reported just this past
summer that 2002 marked the 4th consecutive year in which
insurers lost money on medical malpractice insurance policies
issued in Pennsylvania. As a result, one professional
organization estimates that Pennsylvania, home to the first
medical school and the original 13 States, and now home to some
of the finest medical schools and hospitals in the Nation, has
lost nearly 1,000 doctors who have decided that practice there
just doesn't pay.
The problem is not Pennsylvania's alone. Just last year,
the Trauma Center at the University of Nevada Medical Center in
Las Vegas had to close for 10 days because surgeons quit in the
face of huge increases in their malpractice premium. Such
stories are legion, and I do not propose to rehearse them all
today. They arise from across the country.
The flight of doctors from the profession or from high-
exposure specialties or geographic areas threatens Americans'
continuing access to quality health care--women without doctors
to deliver babies, accident or crime victims turned away from
crime centers, increasing practice of defensive medicine, these
are the realities of a worsening national crisis.
As I said, few could question the diagnosis. The debate
grows heated, however, when we try to settle on a cure. Many of
us, including President Bush, believe that one important step
must be a comprehensive nationwide reform of medical
malpractice law. There are simply too many meritless medical
malpractice suits filed and there are too many overly generous
jury awards. Faced with that uncertain and potentially
unlimited exposure, insurance companies feel compelled to
protect themselves and raise their rates, meaning full reform
should include caps on awards for noneconomic damages, that
ethereal category of damages that includes such intangibles as
pain and suffering. It should include limits on the fees
lawyers can recover, and it should raise the burden of proof
and include caps for recovery of punitive damages.
The thrust of each of these measures would be to strike a
balance between the legitimate need to provide redress to
injured patients and the insurance industry's need for greater
certainty about its potential exposure.
House bill 5 referred to earlier, sponsored by
Pennsylvania's James Greenwood and passed by the House more
than 6 months ago, included each of these provisions and more.
Unfortunately, that legislation, like other similar measures in
years past, was unable to make appreciable headway in the
Senate.
While we cannot be assured that these reform measures will
alleviate the crisis, there is sound empirical evidence to give
us hope. As the chairman reminded Representative Waxman,
California, for example, enacted a comprehensive reform plan
nearly 30 years ago. Since then, insurance premiums there have
risen at less than half the average national rate. Other States
that have enacted substantive reform report similar success.
Opponents of these reforms will tell you that there are
other causes for skyrocketing malpractice premiums, such as
poor investment decisions by insurance companies. That
explanation, whether true or not, ignores the significant
differences in rates between States that have enacted real
reforms and those that have not. If the problem were simply
poor investments, we would expect to see similar rate increases
across the board without regard for geography.
In addition, that Pennsylvania Department of Insurance
study I mentioned a moment ago made a very helpful distinction.
It explained that in the decade between 1992 and 2002,
Pennsylvania medical malpractice claims payments almost
tripled, premiums more than doubled, but investment income for
insurers declined by only a third. The Pennsylvania study noted
that in 2002 medical malpractice insurers in Pennsylvania
earned more than $46 million on their investments. However,
because of malpractice claims, which comprise more than 61
percent of all insurer costs in Pennsylvania, those insurers
still ended the year with an $18 million loss.
Considering that data and similar information from six
other States, the GAO concluded in June, as you've heard, as
Mr. Hillman has already testified, that losses on medical
malpractice claims appear to be the primary driver of increased
premium rates in the long term. Even if the poor investment
argument were to some degree correct, it would still miss the
point.
Study after study tell us that malpractice litigation is,
at the least, a substantial contributor to the insurance
crisis. Reform opponents seem to believe that a problem can
only have one cause and, correspondingly, one solution. Of
course, that's not so. If litigation reform could slow the pace
of insurance rate increases, it would be well worth it. The
trial lawyers point a finger at the insurance industry, at
least in part, I suspect, because meaningful tort reform might
well hit those lawyers in the pocketbook.
There is then the issue of whether the reform should be at
the national or local level. Mr. Waxman discussed that at some
length. As a former Governor, I have great faith in State
governments and their ability to react to the needs of their
citizens. Several States, Pennsylvania included among them,
have enacted reforms. With rare exception, however, those laws
are too often the cobbled-together results of political battles
between doctors' groups and trial lawyers. As a result, they
reach the statute books so diluted as to be nearly useless.
Mr. Chairman, the medical malpractice problem is national
in scope and effect. Many doctors have interstate practices;
many insurers provide coverage in more than one State. The
Federal Government itself, through direct coverage of members
of the military, veterans and others, and through Medicare,
Medicaid and community health initiatives, is a major consumer
of health care. The crisis affects our national economy through
jobs lost when hospitals, medical clinics, and offices close
and when productivity is lost through workers' receiving
inadequate health care. A national problem, in short, requires
a national solution.
I recognize that the same political pressures that have so
watered down reform efforts in many States may well prove to be
insurmountable as an impediment to this body's lead in passing
appropriate Federal reforms, but something must be done, and it
must be done nationally and it must be done on a comprehensive
basis and it must be done, Mr. Chairman, soon.
Thank you very much for permitting me to appear today.
Mr. Burton. Thank you, Governor. We appreciate, very much,
your comments.
[The prepared statement of Mr. Thornburgh follows:]
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Mr. Burton. We'll just go right down the line.
Dr. Nelson.
Dr. Nelson. Well, thank you very much. Good afternoon. And
Ranking Member Watson, good afternoon to you, too.
I'm John Nelson, the President-Elect of the American
Medical Association. I practice obstetrics and gynecology in
Salt Lake City, UT. The American Medical Association
appreciates the opportunity to discuss how our Nation's medical
liability crisis is seriously threatening patients' access to
quality health care.
Now, what's a crisis?
You know that our health care system is facing a crisis
when patients have to leave their State to receive urgent
surgical care or when pregnant women cannot find an
obstetrician to monitor their pregnancy and deliver their
babies or when a community health center has to reduce their
services or close their doors because of liability insurance
concerns.
You know that a health care system is facing a crisis when
efforts to improve patient safety and improve health care
quality are stifled because of fear of lawsuits.
Escalating jury awards and the high cost of defending
against those suits, even those without merit, are causing
medical liability insurance premiums to soar out of sight.
Several recent Federal Government and private sector reports
referenced in our written testimony confirm this. You just
heard the GAO recently verify that losses on medical liability
claims, the largest part of liability insurers' costs, appear
to be the primary cause of increasing medical liability
insurance--not the only cause, the primary cause.
In many cases, over the last 2 years, physicians have been
hit with medical liability premium increases of 25 to 400
percent. My own doubled. As medical liability insurance becomes
unaffordable or unavailable, physicians are being forced to
relocate, close their practice, or drop vital services.
This is a growing national problem that affects more than
just physicians and other health care folks. It affects
patients, real people, not statistics. This affects their
ability to access health care that they actually need.
Every day for the last couple of years there's been at
least one major media story on the plight of American patients
and physicians as this crisis reaches across the country. The
AMA has now identified 19 such States that are in crisis, up
from 12 just a year ago, and many others where the crisis is
looming.
The GAO evidence studied five crisis States and found, as
you heard, examples of reduced access to care affecting
emergency surgery and newborn deliveries. In fact, the AMA has
no doubt that the GAO would have had even more access to
problems found if they had examined the other 14 States.
By written testimony, we believe the GAO could have
strengthened its findings; and in good faith, we think if they
had looked a little more carefully, a little more across those
States, they could better reflect the severity of the crisis.
The AMA believes that when an injury is caused by
negligence patients are entitled to prompt and fair
compensation, complete compensation--all economic losses, lost
wages and legitimate medical expenses. Also appropriate, we
believe that patients should receive reasonable compensation
for the intangible noneconomic damages, such as pain and
suffering.
Unfortunately, our medical liability system is neither fair
nor predictable. It's becoming increasingly an irrational
lottery, driven by open-ended damage awards for unquantifiable
economic damages. The studies have concluded that the only
significant predictor of payment of claims in a medical
liability case is injury and not the presence of an adverse
event due to negligence; in other words, injuries often lead to
settlements or jury awards even when the standard of medical
care has been met.
Mr. Chairman, you and others know that if H.R. 5 is one of
the answers, it's past due. The question people are asking
around the country is: Will my doctor be there?
As a physician I ask: Can I be there?
That is why we worked so hard with HCRA and others to get
H.R. 5 passed, and we need the same thing to happen in the
Senate.
Of course, you know one of the keys is a limit of $250,000
on noneconomic damages, with flexibility so States can
determine their own caps, if need be. And as discussed, it
worked very well in California; we know how the premiums in
California have not increased as much as elsewhere.
HRQ, the Agency of Healthcare Research and Quality, tells
us that the access to physicians, the increase in physician
supply--it is increased at a faster rate in States that have
passed caps than where they haven't. That's got to continue. We
cannot afford the luxury anymore to wait until this liability
crisis gets worse because it affects real patients. We have to
be like the meteorologist. We cannot tell there's a hurricane
here; we have to tell there's a hurricane coming. It's good
preventive medicine.
Mr. Chairman, we've got to get some common sense back into
courtrooms or there will not be doctors in the emergency rooms
and delivery rooms.
Thank you very much.
Mr. Burton. Thank you, Dr. Nelson.
[The prepared statement of Dr. Nelson follows:]
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Mr. Burton. Mr. Angoff.
Mr. Angoff. Thank you very much, Mr. Chairman,
Congresswoman Watson.
I'm Jay Angoff. I'm a lawyer from Jefferson City, MO. I was
the director of the Missouri Insurance Department between 1993
to 1998; and, Mr. Chairman, I'd like to start out by answering
a question you asked to the first panel, which is, exactly what
kind of data do the States collect at the department level and
what kind of data does the NAIC collect?
As the representative of the GAO said, most States and the
NAIC collect the data from the States, will collect data from
the companies, as to their aggregate paid losses, their
aggregate written premiums, their aggregate earned premiums,
their aggregate incurred losses; but in general, the States do
not collect case-by-case data, and I think that's what the GAO
is looking for.
However, we did begin collecting case-by-case data in 1987.
A law was passed requiring our insurance department to collect
data on medical malpractice cases on a case-by-case basis, and
so we've done that every year. In the 6 years that I was the
commissioner, we had great experience. Filed claims went down,
reported claims went down, and, in those 6 years, we had an
excellent malpractice market. Rates generally stayed the same
or even went down in certain years.
After I left the department, we continued to collect this
data and we continued to have good experience, and in 2001, we
had particularly good experience. Between 2000 and 2001, closed
claims went down by 19 percent, filed claims went down by 31
percent, and the average payment per claim also went down. For
example, in cases of very serious injury, such as quadriplegia
and paraplegia, the average payment per claim went down from
$325,000 to $250,000. So, between 2000 and 2001, filed claims
went down, closed claims went down, the average payment per
claim went down.
What do you think happened to malpractice insurance rates
in 2002? Well, they went up. They went way up. Obviously, this
cannot have anything to do with paid claims because those have
gone down.
What it does have to do with is the insurer's estimates of
incurred losses, and I'll get to a more technical explanation
of that at the end of my statement. It's technical, so I'd
rather not get into it and take the risk of putting everybody
to sleep now, but it's just important to recognize that
insurance rates are based on not the amounts that insurance
companies actually pay out, but the amount that they project
that they'll pay out in the future, and I'll return to that.
So, in any event, that's what our data showed in Missouri.
Now, Mr. Chairman, you said and I know it to be correct
from my own experience, that Indiana has very low rates,
relatively low malpractice rates, and it also has a cap on
noneconomic damages.
Other States also have very low malpractice rates, and they
include Minnesota, Iowa, and North Dakota. Those States do not
have caps on noneconomic damages.
I believe, Mr. Chairman--I don't pretend to have done any
scientific study on this, but I believe it's cultural to a
certain extent. I believe if a study was done, and maybe this
is something that the GAO would be very equipped to do, the
factor that correlates the most with high losses, high paid
claims, is percent urban. I think in the upper Midwest and
Midwest--particularly in the upper Midwest--people are pretty
conservative, juries are pretty conservative; and whether or
not there's a cap, I think rates there are relatively low. So
the main factor, I believe, that correlates with relatively
high payouts is percent urban.
But that leads to the question, Mr. Chairman, what about
California?
California, obviously, is a very heavily urban State, and I
think that there's no disagreement that insurance premiums,
malpractice insurance premiums in California since 1975, when
MICRO was enacted, have increased at a substantially lower
level, lower rate, than premiums across the country. But if you
look at the data year by year, Mr. Chairman, what you see is
that in the mid-1980's, despite MICRA, insurance premiums,
malpractice premiums, in California shot way up, way up. They
tripled between 1982 and 1988 despite MICRA's being in effect.
Then, beginning in 1989--1988 was the peak. Beginning in
1989, insurance premiums, malpractice premiums, began to fall
and moderate; and they moderated so much that in 2000, 12 years
after the peak in 1988, malpractice premiums were less, even
without accounting for inflation, than they were in 1988.
So that leads to the question: What happened in 1988?
In 1988, in California--and obviously they do things
differently in California--the public voted, enacted a very,
very extreme regulatory measure, called Proposition 103, which
heavily regulated insurance companies. It required prior
approval of all rates. It required a hearing, an automatic
hearing, anytime an insurance company asked for a rate increase
of more than 15 percent. It repealed the antitrust exemption
for the insurance industry, and it required all companies to
roll back their rates by 20 percent unless they could show that
they wouldn't be able to earn a fair rate of return under the
rollback rate.
This is a very extreme initiative. It wouldn't have gotten
off the ground in Missouri; I do not think it would have gotten
off the ground in Indiana. But it passed in California. And
there's no way to prove a cause-and-effect relationship, but
you can prove the association, and the association is, after
Prop 103 was enacted, malpractice rates in California went way
down.
Just one or two other points, Mr. Chairman. Let me talk
briefly about the difference between incurred losses and paid
losses.
Paid losses, as the name indicates, they announced that
insurance companies actually pay out of the incurred losses,
which is the term, as you know, that is always used in the
insurance industry, but to the layman it seems sort of
misleading because these are the--these aren't really losses.
They're the amounts that insurance companies project that
they'll pay out in the future, and they may or may not actually
pay out that much.
Now, when you saw the GAO's chart over there, it showed
paid losses increasing at a moderate rate. If they used the
medical CPI, it would have increased at a much more moderate
rate, it would have been flatter; and if they take into
consideration the growth in the number of doctors, it would
have been still flatter. But those are quibbles. Pay rates
increase at sort of a moderate rate, but what you saw with the
incurred losses is--they went like this: They went way up in
the mid-1980's, and then today, in 2002, they went way up
again. We won't know.
As you know, Mr. Chairman, we won't know whether the
incurred loss estimates that insurance companies are making
today are accurate for another 8 or 10 years, but what we do
know is--we do know how accurate the incurred loss estimates
insurance companies made in the mid-1980's were and we know--
and that chart gives you a clue--we know that those estimates
turned out to be way, way overstated, not necessarily because
of any bad faith, but they turned out to be way overstated. And
you can--and there's the reason we know; that is, the paid
losses have now come in, so we can tell that the incurred loss
estimates insurance companies made in 1986 and 1987. Based on
those losses being paid over the next 10 years, we now know
that those incurred loss estimates were about 30 percent
excessive.
We won't know, as I said, whether today's loss estimates
were excessive until 2012 or so, but based on past experience,
I believe that they will prove to be excessive.
And I'd just like to conclude Mr. Chairman; I appreciate
your patience. I guess I'd just like to conclude by saying,
there are a lot of things the States can do to try to solve
this problem, fewer that Congress can do. The reason is that
insurance is the one industry which is regulated solely at the
State level. That is a prerogative. The State insurance
commissioners are very jealous of that, so there's not that
much that Congress can do; but I guess whether it's Congress or
the States that'll take this action, I think that the single
most important reform that could be enacted is one which would
set standards that insurance companies have to follow in making
their incurred loss estimates, so that we wouldn't have these
wild swings.
You know, there was--rates are going way up today, rates
went way up in the mid-1980's, rates went up in the 1970's. We
wouldn't have these wild swings. Doctors would be able to
handle it much more easily.
Thank you, Mr. Chairman.
Mr. Burton. We'll get to that, those questions, in a little
bit, because I know how they set those reserves; and some of
the companies do do that in an excessive way. But if you've got
a State insurance commissioner and he's watching that, they can
usually cope with that. But we'll talk about that in a minute.
[The prepared statement of Mr. Angoff follows:]
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Mr. Burton. Mr. Joyce.
Mr. Joyce. Mr. Chairman, thank you very much. And Ranking
Member Watson, thank you. I appreciate the opportunity to be
here.
I know time is short, and, as a former congressional
staffperson, I know the golden rule to be brief, and I will
attempt to do that.
At the outset, I'd like to associate myself with General
Thornburgh and Dr. Nelson, in particular, in highlighting the
problems that our health care liability system poses for
patients, for physicians, and health care providers in general.
Let me just say, though, I would go even one step further
and remind the subcommittee--and I would certainly say this to
members of the State legislature, as well--that there are
institutions in our health care system that are critical as
well, that are facing similar problems. Hospitals rely on
physicians to staff their emergency rooms, and trauma surgeons,
as the chairman mentioned, are in short supply; and they are
all feeling the pinch.
It extends even to nursing homes long-term care providers.
They need medical providers. They need the top of the
profession to assist them. Without those officials, they cannot
provide the health care that we all expect and need. The whole
continuum of care really is at stake here, and I encourage the
subcommittee to take that into account.
We at ATRA are strong supporters of MICRA. We would hail
that and do hail that as the benchmark and the model for State
legislatures and for the Congress to consider as the civil
justice reform for the health care arena. As other witnesses
have said, there are other issues in health care, and certainly
with respect to insurance, but I think the evidence is
overwhelming that the excessive costs, as reflected in
liability insurance for health care providers makes this a
critical component of any effort to deal with health care in
the Congress and at the State level.
Let me add, in terms of the picture Mr. Angoff talked
about, California's experience. I think he made some
interesting points, but I think it's instructive for the
subcommittee to look at the history of MICRA and to look at the
rise in insurance rates for health care providers in the
aggregate, for physicians in California versus the rest of the
country. From 1976 to 1999, California practitioners saw an
increase of 167 percent. By craft, physicians in the rest of
the country saw an increase of slightly over 500 percent, so
roughly a three-to-one ratio. I think that, in and of itself,
is quite compelling.
Mr. Chairman, you mentioned the disparity in costs that
practitioners in Miami versus Los Angeles, in the OB/GYN field,
experienced. A similar experience would be the case for a
general surgeon. In Los Angeles, according to the Medical
Liability Monitor in 2002, a surgeon would pay insurance
premiums of $36,740; by contrast, in Miami, it would be just
over $174,000. Again, this is money that has to come from
somewhere, and while there may be other issues to deal with,
clearly the experience of MICRA demonstrates that this is a
powerful factor.
Let me mention also, because we've heard about the States,
and we certainly are advocates of State civil justice reform,
that Texas took a very aggressive step this year in following
the lead of California with the MICRA law and passed
comprehensive legislation. But Texas did something else which
is very important to keep in mind. Just as, I believe it was
last week, Texas voters passed a proposition, Proposition 12,
which cleared the way to ensure that a judicial challenge to
the Texas medical liability law will not result in its being
overturned.
We've heard about States' rights, and I would suggest
respectfully to the subcommittee that there is a concerted
effort by proponents of civil justice reform at the State level
to undo what State legislators have done. It hasn't worked in
every instance, but noneconomic damage limits in Illinois and
Ohio have been overturned by State Supreme Court in those
States, and that's something that again, as you contemplate
your role in fashioning liability law, you should certainly
keep in mind.
Let me mention also that with respect to tort reform, not
every reform proposal will have an impact on insurance rates,
certainly not immediately. We do not hesitate to say that when,
in fact, that's the case and that has been the case. A proposal
to limit punitive damages or simply to say that the standards
should be raised to clear and convincing evidence will not have
an immediate impact, in all likelihood, on insurance rates.
However, limiting the outer--establishing an outer limit on
noneconomic damages, I think common sense tells us, will in
fact have that benefit.
Let me conclude by saying, Mr. Chairman, that you and
Members of the House have taken the right step in enacting H.R.
5. That's a sweeping proposal and it addresses the issue, we
think, in a balanced way. And we also want to commend you not
only for covering doctors who clearly are the backbone of our
health care system, but all segments of the health care
community.
Many thanks.
Mr. Burton. Thank you Mr. Joyce.
[The prepared statement of Mr. Joyce follows:]
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Mr. Burton. Mr. Tayoun.
Dr. Tayoun. Chairman Burton, Ms. Watson, thank you for
giving me the opportunity to speak. I am a board certified
vascular and general surgeon in Philadelphia. I am president of
the Politically Active Physicians Association, which formed
approximately 1 year ago. I'm here to tell you--to kind of add
a face to what is going on.
I first started my practice in 1997. I purchased medical
liability insurance for $28,789. In 1 year, the same policy
with no claims history increased to $44,000. To sum it up,
between the years 1997 to 2001, my insurance increased over 500
percent. By the year 2002, with only two claims against me--
both dropped, however--my insurance went to $133,000, and
adding insult to injury, the insurance company that was
providing me with this said, oh, by the way, we're going to
leave the State. So I was left without insurance and looking
for somehow, from anyone above--we formed the Politically
Active Physicians Association to help legislators in our State,
which is Pennsylvania, to take a hard look at what is
happening, because when I leave, I leave thousands of patients
behind who cannot follow me.
Now, I took some research and looked into where am I going
to practice, because I cannot afford $133,000 and there is no
insurance company at all for me. I looked into New Jersey,
which is 10 minutes from where I practice now, and I found the
same insurance company would give me a $34,000 policy. I found
that if I went 20 minutes into a different State, Delaware, my
insurance policy was quoted at $7,500--same surgeon doing the
same surgical procedures with such a dramatic fluctuation.
There's a problem, and it's a problem that's across America
and needs to be addressed on a Federal level, I feel.
I can go into multiple examples in our State of physicians
who left, and our organization had put a poll out to 150
hospitals, asking for data on the youngest surgeon in the high-
risk specialties because, as you might not know, and I'll
explain to you, when a general surgeon enters the field right
out of residency training it takes approximately 10 to 15 years
for that surgeon to become honed, to be able to handle any
emergency that comes into that hospital; and we do that by
having senior surgeons directing us and guiding us and being
able to bounce questions off of.
The problem is, most of the physicians in Pennsylvania now
are 50 years or older. The orthopedic surgeons, less than 35
years of age, in Pennsylvania, are less than three.
The base of--the foundation of the whole infrastructure to
the medical system in Pennsylvania has been gutted and ripped
out and will fall; and when we do actually realize it and when
it hits like--the hurricane actually hits, it's going to be too
late to fix that; and it's going to take at least 30 years to
get better physicians back.
We have world renowned institutions in Philadelphia. We
train most of the doctors in America, but we cannot retain
them. The Pennsylvania Medical Society has shown that
Pennsylvania ranked 12th in youngest physicians in the country,
and it's dropped to 41st in a matter--from 1996 to the year
2000. And we actually think we have zero in 2003, but they're
still working on the study.
In short, who loses is not the doctor; it's the patient.
Doctors can get up and leave. My patients cannot follow me. I
take care of the needy. I take care of the elderly. They cannot
follow me; and they've told me this time and time again. And
with this, we've put together our organization to try to help
educate our patients, to help our elected officials to do the
right thing--in fact, nationwide tort reform which is needed to
allow physicians to continue practicing in the needy areas and
to help our elderly.
That's it.
Mr. Burton. Thank you, Doctor.
[The prepared statement of Dr. Tayoun follows:]
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Mr. Burton. I want to thank all of you.
Let me start with you, Doctor. What kind of political
pressures have you had to deal with in getting tort reform
passed through the Pennsylvania legislature?
Dr. Tayoun. We have had to hold rallies, we have had to
stop working to protect up at Harrisburg. We've pushed and
fought. We've had our patients on buses with us at different
locations. We've organized the cities from Philadelphia to
Harrisburg to Pittsburgh, and we finally got legislation passed
through the house of representatives, which is now in the
senate and stalled.
The problem with Pennsylvania is, we have a constitution
which has to be changed first before anything can be enacted,
so we're running out of time rapidly.
Mr. Burton. You have to have a constitutional amendment?
Dr. Tayoun. Sure, to allow caps in Pennsylvania.
Mr. Burton. Is that right?
Dr. Tayoun. Yeah.
Mr. Burton. And that takes, what, two sessions of the
general assembly?
Dr. Tayoun. Yes.
Mr. Burton. And then it has to go to the electorate?
Dr. Tayoun. Yes.
Mr. Burton. So that's a 6- or 7-year problem, and in 6 or 7
years what would happen?
Dr. Tayoun. Too late.
Mr. Burton. Too late. So what you're making, by saying
that--and I don't know if that's the case in other States or
not, but if that's the case in other States, if you wait 6 or 7
years, the people in that State are going to be without the
kind of medical personnel that they need to take care of their
health care needs?
Dr. Tayoun. Correct. Out of the 32 hospitals that responded
to our poll, 4 of them had trauma surgeons left.
Mr. Burton. And if that happens, then it would take how
long for you to recover if, finally, the State did deal with
it?
Dr. Tayoun. If the State did deal with it, it would take at
least 20 years because it's going to--for the average surgeon
coming out of residency, it takes him at least 10 to 15 years
under senior, experienced surgeons to help them become
polished, so I don't know if you could ever get back to that
point, especially in the rural areas of Pennsylvania.
Mr. Burton. So you make a very strong case that we need
some kind of Federal legislation that would circumvent the----
Dr. Tayoun. State.
Mr. Burton [continuing]. State legislative problems.
How about the rest of you? Can you tell me what kind of
problems that you face?
I'll get to you on reserves in a minute.
Can you tell me of any other States that are having similar
problems, as far as getting----
Mr. Thornburgh. Yeah, this is purely anecdotal, and this is
10 years or so, but I've been kind of a missionary around this
State for civil justice reform in general.
Understandably, trial lawyers and plaintiffs' lawyer groups
have amassed sizable war chests to resist reform. I would refer
you to a publication of the Manhattan Institute, issued last
week, called Trial Lawyers, Inc., which lays out in great
detail what those efforts have encompassed. And I have worked
with reform groups at the State level in a number of areas to
try to enact reform.
Often, when successful, as Mr. Joyce noted in Ohio and
Illinois, the supreme courts of those States struck down the
reforms as unconstitutional. And I cannot help but note how
much effort from the Trial Lawyers Association goes into the
election of judges and supreme court justices.
Mr. Burton. So because of these impediments that were
talked about by Dr. Tayoun and you, you feel that--you know, I
believe States' rights ought to be paramount, but at some
point, if you cannot get something done and the public health
is jeopardized, you have to do something at the national level.
Mr. Thornburgh. I think that's a very practical reason why
Federal action is necessary, in addition to the nationwide
characteristics of the problem.
Mr. Burton. We have some votes coming in.
Ms. Watson, let me just recognize you.
Ms. Watson. Yes.
I'm going to just raise these questions and then go on to
the floor. Maybe the response can't be in answers.
It seems like you have a problem in Pennsylvania. You know,
from what I'm hearing, the doctor there and Mr. Thornburgh, you
have described that Pennsylvania's in trouble.
Dr. Tayoun. So's Florida.
Ms. Watson. Florida and Pennsylvania.
Mr. Thornburgh. We happen to be here by random, but I think
if you had representatives from most of the other 49 States,
you would hear----
Ms. Watson. Well, I have a chart here, and we talk about
States in crisis, States that are showing problem signs, and
States currently OK. My State, California, seems to be
currently OK because we had been working for years to deal with
the problem.
But the way it has been presented here, that there's some
real serious problems in Pennsylvania, I'm wondering what are
the component factors that make up the serious crisis that
you've got in Pennsylvania, that's No. 1; and No. 2, is tort
reform the solution to lowering the premiums? Because I just
heard, by the gentleman in the center there, that even with the
incidents going down, the premiums still went up.
So if there is an answer to that question, would you please
give--it may be in writing--to us. And you can reach me through
my office because I'm going to--Rich, I'm going to fly because
I understand we have three votes, and that's all the votes for
the day.
Thank you very much, Mr. Chairman.
Mr. Burton. Well, let me pose a couple more questions here
and make a comment. The problems that you cited, Governor, in I
believe it was Ohio and Illinois--was that it?
Mr. Thornburgh. Yes.
Mr. Burton [continuing]. Where the supreme court struck
down legislative action, leaves them in a hopeless situation as
far as dealing with the problem. Pennsylvania has another
situation. Those are just three States right there.
And, Dr. Nelson, you were talking about Florida?
Dr. Nelson. Yes, sir.
Florida's a problem. Mississippi's a problem.
There's a sign on the highway near Tupelo, MS, the home of
the largest rural hospital in the country, that says, ``Buckle
your seat belt; the next neurosurgeon that will help you is in
Tennessee.''
You know about the story of the circumstances in Las Vegas.
West Virginia, little 9-year-old kid gets knocked out in the
football game. Not a doc from the State will see him. Has to be
airlifted to Columbus, OH.
It goes on and on, and that's why we need a Federal
solution. Florida is dying. $300,000 is how much one doctor had
to pay, a cardiothoracic surgeon.
$200,000 a year for premiums for my specialty? That's more
than I make, Mr. Chairman. I couldn't afford to do that.
Mr. Burton. And, if you didn't have insurance and you had a
claim, you could lose everything you own.
Dr. Nelson. Yes, sir.
Now, things are different in Utah, you have to put a
multiplier there. I only pay $72,000, but I make a third less
than the doctors in Florida. My premiums doubled in a 2-year
span with no suits or threat of suits against me----
Mr. Burton. And doctors are not going to stay in a State
where the insurance is so high they cannot afford it. They're
going to leave rather than jeopardize their assets.
Dr. Nelson. Yes, sir, which is why a Federal solution is
necessary. Patients go from State to State, doctors go from
State to State, and the wisdom of your solution, H.R. 5, would
give flexible cap.
Mr. Burton. Regarding the reserves you're talking about,
sometimes companies do set excessively high reserves, there is
no question about that. Those reserves should be policed by the
State insurance commissioner, and that's something that has to
be done on an individual basis.
But with all these problems that they're talking about, Mr.
Angoff, and I understand that California dealt with it, it
wasn't because of the proposition you talked about; it was
because of tort reform they passed a long time ago. But I won't
get into a big debate with you, because I think probably you
and I have a difference of opinion, but go ahead and make a
quick comment.
You'd better make it brief because we're going to have to
go on the floor and vote.
Mr. Angoff. The reason I say it's Prop 103 and not MICRA is
that until Prop 103 was passed and only MICRA was the law,
rates still went way up. They tripled in 7 years.
Mr. Burton. But I don't want to have a big debate about
that.
Mr. Angoff. And, Mr. Chairman, I agree with you. The
insurance commission should police reserves. They try to.
They're not always successful. And at certain times insurance
companies--I mean, insurance companies can have an incentive to
inflate their reserves both in times like this, when investment
income is low, when interest rates are at 1 percent. We've also
got tax reasons to inflate their reserves.
On the other hand, they've also got a reason to understate
their reserves. For example, when companies are in trouble----
Mr. Burton. I understand.
Mr. Angoff [continuing]. Then they've got an incentive----
Mr. Burton. You're preaching to the choir. That was my
business, so I understand everything you're saying, but I've
just got a little disagreement with you.
Let me say this to you: We've passed this in the House and
we'd like to be able to educate our colleagues in the Senate,
who may not be influenced by large amounts of pressure.
What I'd like to have from each one of you is maybe a very
concise statement about the situation that you face in
Pennsylvania, the situation you talked about in Illinois and
Ohio, the situation you talked about in Mississippi and
Florida. If you could give that to me, what I'll do is I'll
talk to some of my colleagues in the House who feel sympathetic
to your situation and try to send a Dear Colleague and a joint
letter to my colleagues in the Senate to encourage them to take
another look at this bill and try to get this thing passed.
I had some reservations, quite frankly, about the bill when
it was in the House. The reservation I had was, what if
somebody was severely damaged by a doctor and it was a lifetime
problem for them. But my fears were allayed because the damages
were going to be paid. It was pain and suffering that had the
limits on it.
So I am very sympathetic to you. I would like to help you.
I do not think there's much more we can do in the House at the
present time unless the Senate acts, but what I'll do--Mr.
Angoff may not agree with me, but I will forward to my Senate
colleagues your recommendations and make sure that they get it,
which might help us get some of it done.
Because then, of course, we've got the problem--you know,
Governor--with the conference committee, because they're
probably going to make some changes. And then we'll have to
fight that battle in the conference committee.
And, Mr. Angoff, at the conference committee, perhaps some
of your arguments can be heard and thrown into the mix.
Anyhow, thank you very much, I really appreciate it. I'd
like to have--I sincerely would like to have your comments in a
very brief letter that I can put into a Dear Colleague to my
colleagues in the Senate.
Thank you very much for being here. I really appreciate it.
It's been very informative. Thank you.
[Whereupon, at 3:45 p.m., the subcommittee was adjourned.]
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