The Impact of High Legal Costs on Healthcare

Spending money on legal fees is a part of our society, especially in the healthcare industry. There is a time and place for the legal system in healthcare, but more and more we unfortunately see instances where legal fees are unnecessary or high, resulting in a significant impact on doctors and nurses and the services provided to patients.

Some of the rising cost of healthcare is directly related to an existing crisis in our country. One of the most significant aspects of consumers’ relationship with the healthcare industry is that when things go wrong, one of the first things that happens is someone hires an attorney for a malpractice suit.

Because of high costs for healthcare insurance coverage, we now have 41 million people in the United States going "bare." What this means is that in addition to the individual not getting proper care, doctors and nurses are now faced with a major challenge specific to out of control malpractice coverage. In other words, uninsured patients, doctors have to find a way of protecting themselves in case of error or mishap.

More than $10 billion is spent annually in the U.S. for malpractice and legal costs arising from absence of or inadequate healthcare coverage.In addition to out of control malpractice premiums due to the current tort system, we also see a 50% increase in median jury awards and a 40% increase for median out-of-court settlements.

The frightening thing is that no end is in sight. Because jury awards are increasing, the need for robust malpractice insurance and legal coverage also increases. When you consider the cost of a doctor or nurse battling malpractice claims, you are looking at significant monies. Even maintaining legal counsel and malpractice insurance coverage is enough to put some medical professionals out of business or at least push them to a less risky field of medicine.

While it’s tempting to throw the blame on attorneys’ charges, the underlying issue is that we need better healthcare solutions. In addition, we need laws that better protect medical professionals from frivolous lawsuits filed by money-hungry without a valid claim.

Now, we have seen a proposal by the President with renewed attention on capping awards specific to pain and suffering in malpractice lawsuits. True, this does shed some light on an all-important matter but we still have a very, long way to go. The solution to high legal costs in healthcare is not a cut and dry case. We need to boost our nationwide health coverage, toughen our laws, and ensure doctors and nurses are properly trained. Most importantly, the hospitals and clinics that staff medical professionals need to put strict guidelines in place to reduce risk for malpractice and the ever-increasing legal dollar.