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· "Docs and hospitals practice what's called 'defensive medicine' in order to protect
themselves in a court of law." President Bush, Albuquerque, NM, March 26, 2004.
http://www.whitehouse.gov/news/releases/2004/03/20040326-9.html
The facts: Independent researchers reject the "defensive medicine" theory. The only study
ever attaching a price tag to defensive medicine -- extra medical tests given to avoid lawsuits--
was one conducted by the Bush Administration's own Mark McClellan. 6 No other independent
researcher has been able to replicate his findings. The contention that doctors practice defensive
medicine is crucial to the Bush Administration's claim of high tort costs because the cost of
malpractice insurance is relatively minor. Using McClellan's article to project $25 billion in
"defensive medicine" costs 7 allows Bush to attach an artificially- inflated legal cost to the federal
budget. But both the Government Accounting Office 8 and Congressional Budget Office 9 dismiss
the theory and thus refuse to make cost estimates.
· "Too many frivolous lawsuits … are being filed against doctors " President Bush,
Madison, MS, August 7, 2002. http://www.whitehouse.gov/news/releases/2002/08/20020807-1.html
The facts: So-called "frivolous" suits have little impact on health care costs. Doctors define
as "frivolous" any lawsuit in which no payment is made to the victim. But they fail to mention
that nearly all of those claims are withdrawn voluntarily by patients and their lawyers, 10 after
thoroughly investigating the cause of the injury, usually at great expense to the lawyer. Cases
that are taken to trial and rejected by a jury constitute only 5 percent of all claims.11 Lawyers
have no incentive to file frivolous cases because they are not paid unless they win a case. Only
about 12 percent of malpractice premium dollars are spent defending claims that are closed
without payment.12 If attorneys never filed an unsuccessful suit, the savings would constitute less
than one-tenth of one percent of national health expenditures.13
· "Lawsuits threaten to close the doors of too many small businesses and factories."
President Bush, Washington, DC, July 21, 2004. http://www.whitehouse.gov/news/releases/2004/07/20040721-14.html
The facts: A lawsuit can't wipe out a business, unless the business depends upon unsafe or
illegal activities to make a profit. Sometimes a business that is capable of earning a profit
through lawful means will try to earn extra income by cutting corners. If court judgments
awarded to those harmed by the unsafe or illegal practices exceed the value of the business (i.e.,
its plants, equipment, customer relationships, etc.) the company could be liquidated; but often the
plants and equipment are not scrapped, nor are innocent employees fired. For instance, Johns-Manville
continues to manufacture non-asbestos insulation; its bankruptcy simply led to much of
its stock being held in trust for people injured by asbestos.
· "Industry estimates show that litigation is a $200 billion a year burden on the U.S.
economy." President Bush in Kansas City, MO, September 4, 2003.
http://www.whitehouse.gov/news/releases/2003/09/20030904-5.html
The facts: The $200 billion "lawsuit burden" figure has been repudiated by the
Congressional Budget Office. This number is highly misleading. It was calculated by adding up
the total cost of liability insurance purchased in the United States, including insurance company
administrative costs. But these costs would not disappear if there were no tort system. The costs
of liability insurance represent the costs of injuries that would take place with or without a tort
system, such as the estimated $230 billion annual cost of automobile crashes.14 Even if the tort
system were abolished, the overall cost of automobile injuries would remain the same, as would
the amount Americans pay for automobile insurance, since everyone would have to insure
themselves. The non-partisan CBO called the $200 billion figure "too large." It explained that
most of the payments "merely shift money from injurers to victims and thus are not true costs to
society as a whole." In economic terms, payments that do not involve any use of resources to
produce goods or services are called 'transfer payments.' Those that do involve using resources
for production are known as 'real resource costs' (also 'social costs' or simply 'costs').
Specifically, the portion of a settlement or judgment that goes to the plaintiffs is a transfer
payment."15
· "See, everybody is getting sued." President Bush in Washington, DC, March 16, 2004.
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