In a recent editorial, we praised U.S. Rep. Lamar Smith (R- San Antonio) for his opposition to proposed federal legislation granting a generous tax break to contingent-fee attorneys.
We also noted at the time that his efforts would be for naught if a rumor then circulating proved to be true. It was being whispered where trial lawyers swarm that the Obama Administration was planning to bypass Congress and have the Treasury Department approve the tax break instead.
The American Medical Association took the rumor seriously. AMA members – the doctors who treat our ailments, ease our pains, and restore our health – are a primary target of plaintiffs attorneys operating on a contingency basis, and doctors see no reason to further incentivize their predators.
Along with 90 other medical organizations, the AMA sent a letter to Treasury Secretary Timothy Geithner expressing the conviction that "such a policy change would be ill-advised" and urging rejection of the proposal.
"Such a change is estimated to cost taxpayers over $1.5 billion and could act as a financial incentive for trial attorneys to file less meritorious lawsuits against physicians and other health care providers," the letter affirmed. "Even though a substantial majority of claims are dropped or decided in favor of physicians, the cost of defending against meritless claims averages over $22,000. This leads to increased costs for physicians and patients. . ."
The signatories professed themselves perplexed that "the Treasury Department would consider a change in policy that could add to the cost of health care, especially at a time when our nation is engaged in implementing comprehensive health care reform and expanding coverage to the uninsured."
Former AMA President James Rohack sums up the group's position neatly. "Any change to the tax code that encourages more lawsuits is a step in the wrong direction for our health care system," he asserts. "Instead, the AMA supports proven medical liability reforms already working in California and Texas. . . ."
So do we.