Texas No. 1 in National Tort Liability Study
Report, However, Shows More Reforms Needed
HOUSTON, May 15, 2006 (PRIMEZONE) -- A cutting edge report just released shows that while Texas still has some glaring civil justice problems to address -- most notably the state's notorious "judicial hellholes," Texas tort reforms have strengthened the state's economy in a variety of ways and are improving the quality of life for every Texan.
The Pacific Research Institute in San Francisco has completed the first "U.S. Tort Liability Index: 2006 Report," a comprehensive analysis comparing the tort systems of all fifty states. After weighing 39 variables ranging from civil liability exemptions for junk food to appeal-bond caps, Texas was ranked best in the nation. Had the study been done before the 2003 and 2005 tort reforms, researchers say the state would have ranked 26th.
The PRI research team found that a fair and predictable civil justice system is key to the state's strong economic competitiveness. Texas reforms have already started to bring lower prices, increased job creation, higher wages and more product innovation throughout the state.
The benefits of the medical malpractice lawsuit reforms passed in Texas in 2003, for example, became apparent almost immediately, particularly in South Texas, where doctors had become increasingly scarce and specialists were non-existent.
Liability insurance rate relief turned that situation around and doctors are now establishing practices in previously underserved areas throughout the state. The Texas Medical Board is anticipating a record 4,000 applications for new physicians' licenses next year -- twice last year's total and 30 percent more than the previous best year for the state.
Texas ranked highest in categories of the study that measured declining financial losses linked to frivolous lawsuits. Hospital liability insurance costs drive this point home. After a 54 percent rate hike in 2003, Texas hospitals got a 17 percent cut in 2004.
Thirty new companies are now writing physician liability coverage in Texas, up from four companies in 2003, and Texas doctors are expected to save $42 million on their 2006 liability insurance premiums.
Frivolous lawsuit claims have been cut in half and hospital savings are being plowed into a variety of health care service enhancements ranging from the development of electronic medical records systems to the recruitment of more specialist physicians.
Nationally, the researchers at PRI found that excessive tort costs in the United States cost a family of four $2,654 annually. Texans are paying a smaller percentage of this "tort tax" thanks to our lawsuit reforms.
But all the news from the PRI study was not rosy for Texas. The state's "judicial hellholes" -- those counties in the state that plaintiff attorneys target for trials because they are more likely to get an excessive verdict or settlement -- earned us an abysmal 50 out of 50 ranking.
"Judicial hellholes," two of which were identified as the Rio Grande Valley and the Gulf Coast of Texas, are far more likely to tolerate improper certification of class action lawsuits, the improper introduction of junk science into evidence, and strong alliances between plaintiffs' lawyers and judges.
Texas ranked last on several other factors measured by the tort liability study including the state's failure to impose limits on attorneys' contingency fees and the failure to allow jurors to be informed about payments made to the plaintiff from other sources, such as insurance companies.
Our partisan election of judges also earned Texas the lowest rank of 50 on the liability index. The PRI researchers report that litigation awards tend to be unjustifiably higher when the judiciary is elected. According to the report, "When judges act as politicians in robes, the civil-justice system is further eroded."
These pressing concerns steel our commitment to finishing the work of lawsuit reform in Texas. But the U.S. Tort Liability Index highlights the most important incentive for creating a fair and balanced civil justice system -- economic prosperity and a better life for every Texan.
CONTACT: Texans for Lawsuit Reform