Malpractice Lawsuits Are ‘Red Herring’ in Obama Plan

By Alex Nussbaum

June 16 (Bloomberg) -- Protecting doctors from lawsuits may do more to gain political cover for President Barack Obama’s health-care overhaul than to rein in medical costs.

While Obama vowed to address physicians’ malpractice worries in a speech yesterday, annual jury awards and legal settlements involving doctors amounts to “a drop in the bucket” in a country that spends $2.3 trillion annually on health care, said Amitabh Chandra, a Harvard University economist. Chandra estimated the cost at $12 per person in the U.S., or about $3.6 billion, in a 2005 study. Insurer WellPoint Inc. said last month that liability wasn’t driving premiums.