Demonstration Grants for the Development, Implementation, and Evaluation of Alternatives to the Current Medical Liability System

President Obama directed the Secretary of Health and Human Services to announce within 30 days that HHS would make available demonstration grants to states, localities, and health systems to develop and test alternatives to the current medical liability system. The memorandum framed medical liability reform as one component of broader health care reform, emphasizing patient safety, reduced defensive medicine, fair compensation, and lower malpractice premiums.

Federal Register Open PDF 74 FR 48133

Impact dates

Oct 17, 2009
HHS Secretary must announce demonstration grant program

Key directives

Secretary of HHS to announce within 30 days that HHS will make available demonstration grants for alternatives to current medical liability system
Grants to go to states, localities, and health systems
Projects must align with goals: patient safety first, better doctor-patient communication, fair and timely compensation for medical injuries, reduce frivolous lawsuits, reduce liability premiums

Who is ordered

Secretary of Health and Human Services · Department of Health and Human Services

Timeline

Immediate

HHS Secretary directed to announce demonstration grant program within 30 days

Near term (90d)

Announcement of grant availability expected by October 17, 2009
Development of grant application process and criteria

Long term

Potential implementation of alternative medical liability models
Evaluation of demonstration projects
Possible scaling of successful reforms

Risks & tensions

Limited to demonstration grants rather than systemic reform—scope constrained by 1999 congressional authorization
Explicitly subordinates liability reform to broader health insurance reform, potentially limiting political prioritization
No funding amount specified; actual resource commitment uncertain
Standard disclaimer that memorandum creates no enforceable rights