COMMENTARY: The big business of lawsuits is harming American health

Of the many places from which a public health crisis can emerge, few would suspect the American courtroom could serve as such a place. Yet, a series of legal trends playing out today threaten to make Americans sicker and less healthy. They must be addressed.

Our broken tort system — which has encouraged a slew of all-too-often meritless medical malpractice lawsuits and the advent of novel funding structures to support increased levels of such activity — has created a big business of tort lawsuits.

Precisely, anonymous deep-pocketed investors have been inserting themselves into the legal system by financially backing civil lawsuits in return for a significant share of any settlement or court award through a process known as third-party litigation funding. Creating an industry that incentivizes turning a profit from a legal process that is supposed to be focused on accurately rendering just verdicts for plaintiffs and defendants has had notably adverse effects.

The unregulated practice has been a critical factor in the exponential growth of mass tort lawsuits, causing them to expand from 25 percent of the federal civil docket in 2012 to 73 percent of cases just a decade later. The financial backing provided by unknown and unidentified outside investors also encourages legal firms to bring lawsuits that are potentially based on unproven science that can result in questionable evidence. The lack of oversight also encourages plaintiffs’ attorneys to potentially prioritize pressuring targeted defendants into settlement agreements by using misleading advertising and headline-grabbing claims of corporate malfeasance.

Crucial parts of the health care and medical technology sectors often find themselves in the crosshairs, threatening the development of life-saving medical innovations. The risk of highly publicized questionable liability claims, along with exorbitant legal defense costs and other expenses, reduces investments in all types of health care innovations, including medical devices, procedures and drug research, development, production and marketing.

For fear of legal risk, physicians — the ones who decide treatment options — may likewise become hesitant to try new treatments or adopt cutting-edge technologies, even if these innovations have the potential to improve patient outcomes. As a result, new cures could be delayed in finding their way to patients or even sidelined due to these unorthodox and unprecedented funding arrangements where unknown parties are underwriting and aggressively promoting such lawsuits.

Similarly, attorneys have increasingly turned to aggressive advertising campaigns funded by third-party investor dollars to support their lawsuits, doubling spending on such advertisements in just the past 10 years. Designed to make people think that a prescription drug they take or a medical device they use could be faulty and harmful to the public, they are often designed to look like public service announcements or government alerts and can make misleading and frightening allegations to recruit viewers as plaintiffs in mass tort litigations.

Such advertising tactics can pose a serious risk to patients’ health. They can cause severe negative patient outcomes, including putting people at risk of aggravated symptoms, hospitalization or worse. One survey of medical providers and patients found that more than half of providers had patients who stopped taking a prescription medication without seeking medical advice because of such legal advertising. One-fourth of patients who had seen an attorney as a result of an ad, meanwhile, had discontinued using their medication because of fears it might be dangerous.

The time has come to address the seismic changes that have evolved in the legal tort system. This includes immediate actions to examine raising the bar on the standards for filing class actions or large mass tort actions, more accountability of these entities for potentially false claims, and inducements targeted at consumers and implementing greater oversight concerning third-party litigation funding.

Until measures are taken to curtail such practices and more transparency is implemented surrounding third-party funding arrangements, unchecked mass tort litigation will continue to threaten to undermine the foundations of our legal system that provide proper parameters within which the health care system functions.

Fortunately, Washington is beginning to focus on this issue, and federal tort reform legislation has been introduced. It is now up to our leaders to follow through. Only by addressing these critical issues can we ensure that the American courtroom serves as a beacon of justice rather than a breeding ground for such a public health crisis. The time for change is now, and our nation’s health depends on it.

Vickie Yates Brown Glisson is a health care and health insurance attorney in Kentucky. She wrote this for InsideSources.com.