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Webster Hubbell, Defensive Medicine, and Health Care Costs

I can think of no member of the Clinton administration more deserving of scorn than former Associate Attorney General Webster Hubbell. Hubbell ended up in jail but his conviction had nothing to do with his performance at the Justice Department or with anything related to Whitewater. Hubbell went to jail for the worst offense a lawyer can commit. He cheated his clients. You can find Hubbell’s plea agreement here.

Hubbell's technique for cheating his clients was not even particularly sophisticated. He ran up hundreds of thousands of dollars in personal expenses and then billed his clients for those expenses, falsely claiming them to be case related. While that may not be a particularly complex scheme, it is particularly despicable.

At the core of the relationship between a lawyer and a client is the idea that the lawyer will promote the interests of the client. When a lawyer puts his own financial gain ahead of his duty to a client, he disgraces not only himself, but also his firm, and the entire profession. I have no use for lawyers such as Hubbell. Disbarment, jail time, as well as personal and professional disgrace are completely appropriate in such cases.

In a round about way, that brings me to the subject of health care costs. The John Kerry web site, citing information from “2000 MEPS Data from the Agency for Healthcare Quality Research projected forward using KFF National Premium Increase” notes that the cost of health insurance for American families has risen from $6,772 to $9,549 over the last four years. Reducing the cost of health insurance has become a big issue.

The centerpiece of the Bush/Cheney proposal to reduce the costs of health insurance is to limit non-economic damages in medical malpractice cases to $250,000. It is obvious that the direct savings from such a proposal would do little to reduce health care costs.

According to the Congressional Budget Office the cost of the entire medical malpractice tort system is about $25 billion. Not even Dick Cheney wants to eliminate all of those costs. As the Vice President said recently:

Obviously, we want to preserve the right of people who have legitimate grievances to be able to go to court and address those grievances. That's as it should be. Nobody is suggesting that somebody who has been harmed by a serious breach of medical ethics, or somebody -- a doctor who has made a serious mistake, that an individual patient shouldn't be compensated for those errors.

According to the CBO, about the best we can hope for in direct savings from a damages cap is a reduction of about half of one percent in health care costs. That would save American families less than $4 per month.

The Bush/Cheney idea is not just to get savings from a direct reduction in costs of the tort system but also to change the way doctors practice medicine. The Republican idea is that limiting damages for pain and suffering will reduce the practice of defensive medicine.

Vice President Cheney defines the practice of defensive medicine as ordering tests or procedures that provide no health benefit to the patients in the hope of avoiding or defeating a malpractice suit. He says:

They'll do everything they can in terms of ordering up tests, whether you need them or not, because they're thinking not necessarily about treating the patient, they're thinking about the pending lawsuit.

The Bush/Cheney argument is that a cap on non-economic damages will reduce the incidence of defensive medicine and save $60+ billion per year in health care costs. That argument is predicated on two assumptions. The first assumption is that there is a lot of defensive medicine being practiced. The second is that a cap on damages will result in a reduction of such practices.

I do not think that a cap on damages is likely to result in significant reduction in defensive medicine. That belief results from my having a very different view of doctors than Bush/Cheney.

My experience with doctors in my family, the doctors who have treated me and my family, and the doctors that I know socially leads me to believe that doctors take the Hippocratic Oath seriously.

The Modern Version of the oath includes the following:

I will apply, for the benefit of the sick, all measures which are required, avoiding those twin traps of overtreatment and therapeutic nihilism.

Defensive medicine is prima facie overtreatment and, therefore, a violation of the Hippocratic Oath. President Bush and Vice President Cheney may think that doctors routinely violate their oath, but I do not.

Secondly, I believe that doctors, other than a very small minority, abide by a far higher ethical standard than Webster Hubbell.

Defensive tests and procedures are ordered for the benefit of the doctor (to prevent his financial exposure in litigation) and not for the health benefit of the patient (which, by definition, is zero). They are, therefore, expenses of the doctor and not the patient.

It would be completely appropriate for a doctor to raise the price he or she charges for services that benefit the patient and then pay for tests and procedures ordered for the doctor’s benefit out of his or her own pocket (after obtaining informed consent from the patient, of course).

What is not appropriate is for a doctor to order a test for his own financial protection, fail to inform the patient that the test or procedure is of no health benefit, and then bill the patient (or the patient’s insurer) for the expense.

Webster Hubbell went to jail for incurring expenses that benefited him personally, falsely representing that they were expenses of the client, and then billing the client for such expenses. I see no important distinction between Hubbell’s cheating of his client and the practice of purely defensive medicine. A doctor billing the patient for the personal expenses of the doctor is cheating his patients just as surely as Hubbell cheated his clients.

George Bush and Dick Cheney may believe that most doctors operate at Webster Hubbell’s ethical level but I do not.

My belief that the vast majority of doctors abide by the Hippocratic Oath and operate at a higher ethical level than Webster Hubbell leads me to the conclusion that there is not a large pot of money to be saved from eliminating defensive medicine.

Of course, I might be wrong. Perhaps Bush and Cheney are correct in their assessment of doctors. Perhaps doctors do routinely violate the Hippocratic Oath and have no qualms about defrauding their patients. In that event, would the Bush/Cheney proposal eliminate a lot of defensive medicine?

I see no reason why it would. Under the Bush/Cheney proposal, doctors would still be liable for malpractice claims. They would still be called to account for unlimited damages for health care expenses and lost wages caused by negligence. They would still be liable for pain and suffering up to $250,000.

If doctors continued to order unnecessary tests and procedures, they would still be paid for those services. The Bush/Cheney view is that the doctors are quite willing to ignore their oath and commit massive fraud in order to gain financially. Why would a cap on non-economic damages in malpractice cases change their character?

Edit: Usage errors fixed. Spelling changed.

Posted by Dwight Meredith at July 22, 2004 02:04 PM | TrackBack