Close up of the Lady of Justice statue

The Privatization of Opioid Litigation

By Dan Aaron

As the opioid litigation continues over the shadow of one of our nation’s most pressing public health crises, some criticism has been levied at private lawyers representing the cities, counties, states, and individuals harmed by the crisis. For example, see the following tweet:

Let’s work out tax and healthcare financing policy county by county, with private lawyers taking a 25% cut every time. Judge Polster seems to like this idea.

The critiques are many, but can be summarized: (1) private lawyers are being enriched; (2) private lawyers are setting opioid policy; (3) private lawyers have misaligned incentives; and (4) private lawyers will not support public health.

Arguably, all these arguments bear some truth. However, do they suggest that the opioid litigation is incorrigibly tainted and tort litigation the improper avenue to address mass torts such as the opioid crisis?

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The Law & Economics of the VA Fiasco

By Alex Stein

Over at the CATO blog, Roger Pilon discusses the unfolding VA fiasco that involves hospitals covering up their failures to provide acutely needed services to veterans and doctors working in a slowdown mode (as illustrated by an eight-person cardiology department that “sees as many patients in a week as a single private practice cardiologist sees in two days”). He describes this fiasco as a paradigmatic example of government failure and proposes a remedy: the government should steer away from actually  providing medical care; instead, it should give veterans vouchers towards purchasing medical services on the competitive private market.

This proposal does not take into account the economies of scale and scope that the government can realize from centralizing the purchase of medical work, facilities and equipment, and from self-insuring against medical malpractice instead of buying expensive liability coverage. These economies dramatically reduce the cost of medical care and increase its affordability. Our market for medical care sets prices that many people, including veterans, cannot afford. The voucher system cannot bring those prices down.  Making this system work without shortchanging veterans would therefore cost the taxpayers a fortune. Read More