News in brief - March 6, 2006

Ga. court rules venue provision in tort reform law unconstitutional - Slowdown in spending on physician services predicted

Ga. court rules venue provision in tort reform law unconstitutional

The Georgia Supreme Court Feb. 13 struck down the venue portion of a medical liability tort reform package, declaring it unconstitutional. The law would have permitted defendants in joint medical liability cases to transfer the lawsuit to their county of residence if that is where the alleged negligence occurred.

In a unanimous opinion, the high court ruled that the Georgia Constitution grants the power to change venue to the courts and affirmed a lower court ruling that the law was unconstitutional because it transferred that power to defendants.

The Medical Assn. of Georgia said the ruling was not unexpected and that the venue provision was one of the weaker aspects of the reforms. "Our priority is the cap and expert witness provisions," said spokeswoman Donna Looper.

The law, which passed last year, capped noneconomic damages at $350,000 and imposed stricter rules on expert witnesses, such as requiring them to be in the same specialty as the defendant.

Slowdown in spending on physician services predicted

Annual growth in spending on physician services decelerated from 9% in 2004 to 7.5% in 2005, the Centers for Medicare & Medicaid Services Office of the Actuary estimated in its annual health spending report. A slowdown in the growth of prices for physician services and a downturn in patient income contributed to the 2005 drop. Spending on doctor services totaled an estimated $430 billion last year.

The report predicted that by 2015, spending on physician services would likely near $850 billion. But the actuaries said that is probably an underestimate. The study, published by the journal Health Affairs, assumed that Medicare would start slashing doctors' reimbursements starting in January and continuing through 2013 -- an outcome that CMS describes as politically unlikely. Congress already has altered the outlook for this year by freezing physician rates at 2005 levels at the beginning of last month.

The report predicts a deceleration in all health spending. Growth in national health spending peaked at 9.1% in 2002 but is estimated to average 7.2% over the next decade. Even at that rate, annual health care expenditures are expected to exceed the $4 trillion mark and account for one-fifth of the nation's gross domestic product by 2015.