Peter Orszag, Former OMB Director, Reveals The 'Biggest Gap' In Obama's Health Care Law

WASHINGTON -- Perhaps no Obama administration official who helped craft the Affordable Care Act had a larger imprint -- save the president himself -- than Peter Orszag.

The former Office of Management and Budget header was instrumental in plotting out the economic rationale for revamping the health care system, occasionally irritating Democrats for his willingness to trade politically-worshiped ideas for more esoteric policy levers. The final product ended up reflecting much of his outlook, perhaps most concretely in the creation of an independent advisory board to help control Medicare costs.

But in a speech on Thursday, Orszag copped to having regrets of his own. And, once again, the policies prescription cut against the Democratic Party's traditional mores.

From his speech today at the Peterson Institute for International Economics:

From a substantive perspective this was perhaps the biggest gap along [the encouraging best-practices] dimension: If we had a medical malpractice system that reinforced that emphasis on best practices we would be in a much better position; so if that pop up screen for my doctor in five years also meant that the doctor knew that if he or she followed those best practice protocols I couldn't sue him or her that would help to drive a lot more medical practice.

The debate over tort reform and medical malpractice is, I think, significantly off. The whole debate is over whether we impose caps or not or whether we dial down liability when you are found to be negligent. The core problem in the medical malpractice system, however, is the entire basis upon which it is operational. That basis, so called customary practice, means that it is a nebulous standard and doctors inevitably line up sort of following the social norms among doctors in their area in part because that customary practice protocol means that they have to in order to avoid liability. We should have a best practice emphasis whenever possible.

Tort reform was, in fact, addressed during the course of the health care debate, offered by the president late in the process as a concession to demonstrate the extent of his reach for bipartisan support. But the final agreement, sending grants to states for projects to study how to decrease medical liability and increase patient safety, fell far short of what Republicans wanted. Their vote for the overall bill was never contingent on strong tort reform measures in the first place.

That Orszag would endorse this approach doesn't necessarily put him at odds with the president, who has been speaking about the need for elements of tort reform since September 2009.

Now a vice chairman at Citigroup, Orszag told the Huffington Post after his speech that he will be writing an essay shortly expanding on his vision for best-practice based tort reform.