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CLASS-ACTION LAWSUITS HELP ONLY LAWYERS.

Byline: Anthony Bell

TODAY'S class-action system is a far cry from what early class-action pioneers envisioned. While the goal was originally to serve victims by streamlining the civil justice system, the evidence is clear that in most class actions, Americans are actually being victimized by their own lawyers.

Once considered a key to the courthouse door, the class-action system has been perverted into the class-action lawyers' key to the legal lottery.

The rules of engagement are fairly simple: Find or invent some form of liability, file a class action on behalf of consumers, agree to a settlement, collect your winnings, and if there's anything left for the consumers in whose name the suit was filed, split it up among them all.

Unpopular industries have become the favorite targets. Claiming to represent consumers, class-action lawyers have filed massive lawsuits against lead paint makers, tobacco companies and gun manufacturers, among others. Health maintenance organizations are the latest to be added to the list.

But when the impacts of these lawsuits are considered, it's the lawyers who are winning with class actions. They're the ones who walk away with legal fees in the millions or billions of dollars, while consumers ``win'' coupons, pocket change or absolutely nothing. Worse, consumers in the aftermath of a class action are the ones who bear a higher cost of living as the cost of litigation is passed on to them.

The lawyers' self-serving motives are most apparent in the spate of class actions against HMOs. Lured by the tremendous profit potential, these lawyers are championing themselves as the heroes of HMO reform and have filed dozens of class actions based on some questionable legal theories.

But the reality is class-action lawsuits against HMOs won't help patients. These suits won't make health care more available or affordable. More likely, they'll make America's current health care problems even worse.

In a recent story in the New England Journal of Medicine, David Studdert and Troyen Brennan wrote, ``whatever its net effect, a crisis in the litigation of cases in managed care will be ugly and costly. Two outcomes are certain: Millions of dollars will go toward attorney's fees, and these costs will need to be paid, at least in part, out of health insurance premiums.''

Further, according to a study published in the Journal of Health Economics, a 3 percent to 4 percent decrease in the number of people who are able to purchase coverage is witnessed with every 10 percent increase in the cost of health insurance.

America is already facing a crisis in the availability of affordable health care and health coverage. As litigation drives up health care costs, that will create more uninsured.

More uninsured means more sickness in poorer communities, more emergency room visits and greater taxpayer burden to provide care.

Meanwhile, the lawyers make their millions, and the nation is no closer to an answer on health care reform. There aren't many fans of HMOs, and few would argue against the need for comprehensive HMO reform. But sitting quietly by and letting class-action lawyers abuse the legal system in our name is hardly an answer. It's more like sabotage.

If we're truly going to fix our health care system, the solution lies with our elected leaders and with experts capable of designing a system that works for patients.

Fixing the class-action system, however, is a bit more straightforward: Remove the incentives for abuse. Such ``radical'' reform will require bold proposals, such as requiring class-action lawyers to obtain permission before adding someone to a class of plaintiffs, and tying lawyers' fees to the number of plaintiffs who actually claim their share of any award.

Such ideas aren't likely to be popular with the class-action lawyers, unless they remember that they're supposed to be the ones looking out for consumers. Maybe then they'll agree it's time they started putting consumer interests ahead of their own.
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Publication:Daily News (Los Angeles, CA)
Article Type:Editorial
Date:Oct 16, 2000
Words:648
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