After all, trial-lawyer supporters tried to slip a similar measure into another bill in 2007. Alert legislators stopped that one too, but there’s no sign backers will relent. As one close observer of Congress told me, “It’s the end of the first half, and the opponents of the trial lawyers have a touchdown lead, but the game’s not over.”


The proposed changes to the healthcare reform bill would bypass the court objections and pave the way for potentially massive class action suits.


The provision is arcane and “truly atrocious,” as Walter Olson, a senior fellow at the Manhattan Institute who serves as a legal-abuse watchdog, wrote recently.

It would drastically widen the ability of fre...

After all, trial-lawyer supporters tried to slip a similar measure into another bill in 2007. Alert legislators stopped that one too, but there’s no sign backers will relent. As one close observer of Congress told me, “It’s the end of the first half, and the opponents of the trial lawyers have a touchdown lead, but the game’s not over.”


The proposed changes to the healthcare reform bill would bypass the court objections and pave the way for potentially massive class action suits.


The provision is arcane and “truly atrocious,” as Walter Olson, a senior fellow at the Manhattan Institute who serves as a legal-abuse watchdog, wrote recently.

It would drastically widen the ability of freelance lawyers, acting as what Olson calls “bounty hunters,” to sue in certain kinds of cases called Medicare Secondary Payer (MSP) actions.

Medicare frequently pays the entire medical bill for a beneficiary even though, in some cases, another party, such as a private health or workman’s compensation insurer, or an individual, might be liable for all or part of it. The law requires such a secondary payer to reimburse the Medicare outlay, but sometimes the payer ducks responsibility.

Imagine, for instance, that a senior pedestrian, who is a Medicare beneficiary, is struck by a car. The senior runs up $30,000 in doctor’s bills and files a claim—or a lawsuit—against the car’s driver and his insurance company. Meanwhile, Medicare pays the beneficiary’s medical bills. A year later, the driver agrees to pay the $30,000 claim.

“Sometimes, at this point,” wrote Olson, “Medicare (i.e., the government) demands that the beneficiary hand over some or all of the settlement toward the cost of the healthcare.

“Under some conditions, however, [the government] is also free to file its own lawsuit to recover the medical outlays directly from the negligent driver (who in some circumstances might even wind up covering the same medical bills twice). It might file the suit directly if, for example, it does not expect to get a collectible judgment from the beneficiary.”

That is the way the system works now, according to the MSP Act. All well and good. But the provision that the trial lawyers and their backers got inserted into the healthcare reform bill goes far beyond the current law.

It would let lawyers file suits against secondary payers without asking the government for permission and, in Olson’s ...

“Under some conditions, however, [the government] is also free to file its own lawsuit to recover the medical outlays directly from the negligent driver (who in some circumstances might even wind up covering the same medical bills twice). It might file the suit directly if, for example, it does not expect to get a collectible judgment from the beneficiary.”

That is the way the system works now, according to the MSP Act. All well and good. But the provision that the trial lawyers and their backers got inserted into the healthcare reform bill goes far beyond the current law.

It would let lawyers file suits against secondary payers without asking the government for permission and, in Olson’s words, “collect rich bounties if they manage thereby to extract money from the defendants.” The measure would open the door to what’s called a “qui tam” procedure, which has “led to a growing body of litigation filed by freelance bounty hunters against universities, defense contractors, and others alleged to have overcharged the government.”

The stealth amendment for trial-lawyer enrichment has been almost completely ignored by the media, which have done a miserable job of describing the contents of the healthcare bills winding their way through Congress. Olson, on his blog overlawyered.com, seems to be the first to note the measure’s existence—and only after it was shot down by Camp, Cantor, and the rest.

It was a close call. We will be watching much more carefully if the Senate Finance Committee—or the eventual conference participants—try to put the dangerous provision back in the healthcare bill.

James K. Glassman, former undersecretary of State for public diplomacy and public affairs, is president of World Growth Institute, which promotes pro-growth economic policies.