Does medical liability reform affect the cost and quality of health care? Supporters of President Obama’s health agenda allege, not much. CHRISTUS Health, however, might beg to differ.
Founded in 1866 by the Sisters of Charity of the Incarnate Word, CHRISTUS Health now has hospitals, long-term care facilities, and clinics in more than 60 cities throughout Texas, the south central United States, and Mexico. CHRISTUS Health’s mission is to give exemplary health care to the poor and underserved.
In the year prior to the Texas Legislature’s 2003 tort reform, CHRISTUS Health spent $153 million in liability defense payments in medical malpractice lawsuits. Last year, its lawsuit expense payments totaled only $2.3 million. Why the dramatic decrease?
Dr. Tom Royer, CHRISTUS Health’s CEO, has stated the savings are due entirely from the tort reform measures enacted by the Texas Legislature. Half of its facilities are in Texas and Texas’ lawsuit reform had a dramatic impact.While $150 million per year is a large number for CHRISTUS, how does that translate to the patient? CHRISTUS has made the conscientious effort to use those savings to substantially increase the charity care it provides and to invest in quality initiatives that further improve the care it provides its patients. Ten years ago, CHRISTUS Health provided $353 million a year in charity care. By 2008, that number increased to $565 million. CHRISTUS is on pace to spend $700 million on charity care this year – almost 12 percent of its budget.
CHRISTUS Health measures its expenses as a cost per bed. Since the reforms, the cost per bed in CHRISTUS Health’s Texas facilities is significantly less than in its facilities in states without the tort reform. Lower lawsuit costs allow for more beds.
It is also using liability savings to extend its outreach into communities that need charitable primary care services and in a manner most efficient for both the patient and provider. Recognizing that people often receive their primary care in emergency rooms where it is most expensive and not an emergency, CHRISTUS Health has opened primary care clinics in poorer neighborhoods.
CHRISTUS Health is one example of a hospital system which, before tort reform, was needlessly spending money defending itself from frivolous claims. Now that money is being spent on its primary mission of providing charitable health care to those most in need.
While the goal of tort reform was to rein in the cost of health care to individuals, the cost to taxpayers for indigent care cannot be discounted. Enabling CHRISTUS to provide more charity care offsets the need for more taxpayer-funded indigent and uncompensated care.
Beyond that, Dr. Royer recently assigned $60 million of the liability savings to quality care initiatives, such as updating and retraining the obstetrical nursing staff in fetal monitoring. The program has greatly improved care for patients. Currently, there is not a single lawsuit against CHRISTUS Health involving an allegation of obstetrical malpractice.
So not only is CHRISTUS Health providing more health care, it is committing new resources to ensure its health care is of the highest, mistake-free quality.
We have been told throughout the federal health care debate that our goals should be increased access, higher quality, and lower costs. The CHRISTUS story illustrates why medical liability reform is an essential element of federal health care reform.
The Honorable Joseph M. Nixon is a Senior Fellow with the Texas Public Policy Foundation and of counsel with the Houston law firm Beirne, Maynard & Parsons, LLP. He served six terms in the Texas House of Representatives and chaired the House Committee on Civil Practices during his last two terms.