CNN-TV CROSSFIRE (4:30 PM EST)

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In the CROSSFIRE: Changing the rules? From medical malpractice to Social Security, the Bush administration wants to change the way business gets done.

GEORGE W. BUSH, PRESIDENT OF THE UNITED STATES: The system needs to be fixed.
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ANNOUNCER: We’ll debate the president’s proposals today on CROSSFIRE.
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ANNOUNCER: Live from the George Washington University, Paul Begala and Tucker Carlson.
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TUCKER CARLSON, CO-HOST: Welcome to CROSSFIRE. President Bush says it is one of his top priorities in his second term, and it definitely ought to be. It’s rewriting the laws governing medical liability. Today, the president made a pretty good case for that.

PAUL BEGALA, CO-HOST: Well, it’s always news when a man who originally became president because he won a lawsuit tries to limit your ability to punish corporations who kill or maim you. But, apparently, President Bush doesn’t know the meaning of the word hypocrisy.

President Bush today called for an end to what he called junk lawsuits. Of course, I view him as the man who filed the biggest junk lawsuit of all time. It was called Bush v. Gore, but he fails to see the irony. Supporters say that high malpractice insurance premiums are driving good doctors out of business. Opponents say insurance companies and HMOs are the villains. But Mr. Bush is
unlikely to take on some of his big corporate contributors.

Joining me to debate all that, former Republican Congressman Bob Walker from the great state of Pennsylvania and Democratic strategist Mark Mellman from — I don’t know. What great state are you from, Mark?

MARK MELLMAN, DEMOCRATIC STRATEGIST: Ohio.

CARLSON: Mark, only a professional Democrat would deny the obvious, and that is, of course, that medical malpractice suits drive up the cost of health care. Duh. That is obvious to everyone. Why is not obvious to Democrats?

Let me suggest why not. Since 1990, lawyers have given more than half a billion dollars, $600 million, to federal campaigns. Three out of every four of dollars has gone, of course, to Democrats. Democrats have a vested interest in ignoring what everyone else knows. That is, trial lawyers are bad for medicine. That’s true.

MELLMAN: Insurance companies, HMOs drive up the cost of health care in this country. Everybody knows that, except the Republicans, who depend on their campaign contributions.

The reality is, in places where they have capped malpractice, California, for example, the fact is, the premiums still keep going up. You know why? Because the people that charge the premiums are insurance companies. And they’re more interested in making money than they are in having cheap health care.

CARLSON: Let me just insert some numbers and facts into this conversation. This is the average payment for a medical malpractice claim.

In 1986, the average payment was $95,000. In 2002, it was $320,000. That’s the average payment. What do you suggest accounts for that? That’s not inflation. That’s not the rise in the cost of living. It’s that lawyers are making more money out of suing doctors than they ever have before and they’re giving it to Democrats.

MELLMAN: Insurance companies are making more money out of charging doctors high malpractice premiums than ever before, and they do that regardless of what the verdicts are.

But the reality is, if a doctor is negligent, if anybody is negligent, they ought to pay the price. And the reality is, sometimes doctors are. Sometime, other people are negligent. Sometimes, corporations are negligent. And people ought to have the right to recover damages from those companies and from those individuals that do them damage.

Nobody in this country would — it’s hard to imagine you — people would change the Constitution of this country, which guarantees the right to get that settlement from people who do you harm.

BEGALA: In fact — first, good to see you again, Bob. Our…

BOB WALKER (R), FORMER U.S. CONGRESSMAN: Thanks, Paul. Nice to be with you.

BEGALA: Our president, to his credit, raised this issue in the campaign, hoping to build a mandate, helping to gain capital. He’s trying to spend that capital. I don’t agree with where he is, but I have to respect that. Here’s how he raised the issue in the campaign. Here’s President Bush.

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BUSH: Too many good docs are getting out of business. Too many OB-GYNs aren’t able to practice their love with women all across this country.
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BEGALA: I think what he meant by that — I’m not entirely sure. You know, I worked in the Clinton White House. I think what he meant by that, Bob, is that the cost of the premiums are driving doctors out.

It’s not lawyers who charge the premiums, is it? It is insurance companies. Mr. Mellman has a point. It’s the insurance companies who are ripping off good doctors, so that they can’t practice their love on women? (LAUGHTER)

WALKER: But the fact — the fact is — the fact is that the insurance companies are paying out these huge fees as well. And so it is a circular kind of argument, because the insurance companies do in fact have to pay for these massive lawsuit filings. And that’s what’s driving up the cost.

BEGALA: If that were true…

WALKER: The fact is, in my home state of Pennsylvania, we’re actually seeing the doctors get out of the business because of the kinds of insurance premiums they have to pay.

BEGALA: Right.

WALKER: And because of the fear of lawsuits. And the other problem is that it’s not just the fact that you have the lawsuits themselves that are paid out. It’s the fact that every doctor practices defensive medicine against the potential of…

BEGALA: So they’re extra careful not to cut the wrong leg off. I think that’s good.

WALKER: No. No. No. What they do — what they do is send — send patients to a lot of expensive specialists to make certain that their diagnosis can be backed up. And all of those costs and so on are built into the system.

BEGALA: Good. Good. Good. If it’s my kid, they’re going to make sure. But let me raise — let me bring an expert into this.

WALKER: Very, very huge cost to the overall system, and if it ends up with less doctors, your kid is not benefited by it.

BEGALA: Let me suggest what the problem here is, is that insurance companies are ripping off the docs, because if your argument is right that high payouts cause high premiums, then capping those payouts, those damage awards, should reduce the premiums.

They did it in my state of Texas. Premiums did not go down. Mark mentioned California a moment ago. Here’s the guy who is a reformer in California, Doug Heller. He runs the Foundation For Taxpayer and Consumer Rights.

He told “The Los Angeles Times”: “What we have learned unequivocally is thatcaps on damages do not reduce premiums for doctors. If President Bush,” he says, “really cares about lowering premiums for docs, he needs to take on the insurance industry. And he’s not proposed to do that.”

Why hasn’t the president taken on the insurance industry?

WALKER: Well, the first thing is because the president knows…

BEGALA: Could they be infallible in all this? Are they Mother Teresa?

WALKER: The first defense — the first defense that they are going to make is the fact that you have these massive lawsuits out there. Once you get to the point that you no longer have that, where you have capped that, then you can look at whether or not the insurance companies are…

BEGALA: They’ve done that.

MELLMAN: Congressman, that’s not been the problem.

MELLMAN: The problem is the insurance companies lost a lot of money on bad
investments and that’s why they need to increase their premiums.

WALKER: No, but what you can’t do is take one state’s situation and project that, because most of these insurance companies are large national companies that…

BEGALA: The two biggest states are California and Texas.

CARLSON: Let’s get Mr. Mellman back in here.

Mark, your argument is that people who are injured by incompetent physicians deserve compensation. I don’t think anybody disagrees with that. But if that’s really your position….

MELLMAN: Apparently the president does.

CARLSON: … and the Democrats are not simply shilling for the trial lawyers, as you in your heart know they are, then why wouldn’t you support caps on compensation for lawyers?

In other words, if a child is injured by the ineptitude of a physician, why is the lawyer who represents that child entitled to say, you know, a third of the settlement. Why not cap it?

WALKER: Or 50 percent.

CARLSON: Why not cap — or 50 percent. Why not cap the lawyer’s compensation to, say, an hourly rate, his normal hourly rate?

MELLMAN: What should we cap your compensation at? (LAUGHTER) We don’t go around capping compensation in this country. That’s not something we do.

CARLSON: Hold on. Wait. What are you — of course we do. You have got to be kidding. Yes, of course we do.

MELLMAN: …capping the compensation of private individuals.

CARLSON: Actually, first, yes, we do, do that. And second, and we have done that many times in American history. I’m not saying I’m for it. But I’m saying…

MELLMAN: In fact, you’re against it.

CARLSON: No, but the point is…

MELLMAN: Except in this particular case.

CARLSON: The point is, if you think, if you think, if your motive here is protecting people who are injured by negligent physicians…

MELLMAN: Tucker, it’s actually very simple. John Kerry, John Edwards, during the last campaign, put out a plan that said we ought to punish lawyers who engage in junk lawsuits. That’s the way you deal with this problem. You punish lawyers who engage in junk lawsuits and you go after the insurance companies who are actually ripping off the docs.

And if you do both those things, you’ll actually solve the problem. If you just go after the lawyers, if you just prevent people who have been injured from collecting money, all you’re going to do is help insurance companies and prevent people who are deserving of money from getting…

CARLSON: Sadly — I’d love to attack lawyers more, because I enjoy it, but we are completely out of time.

Mark Mellman, Congressman Walker, thank you both.

WALKER: Thank you very much.

BEGALA: Well, from the left, I am Paul Begala. That’s it for CROSSFIRE.

CARLSON: And from the right, I’m Tucker Carlson. Join us again tomorrow for another and a great edition of CROSSFIRE.