Sen. Orrin Hatch, R-Utah, told am American Hospital Association audience Monday that the United States has "a critical medical liability problem" that is badly distorting health care.

To make his point, he quoted Benjamin Disraeli's famous remark: "If Mr. Gladstone were to fall into the Thames it would be a tragedy. If someone were to pull him out it would be a catastrophe."Hatch said he could not decide whether the present state of medical liability is a tragedy or a catastrophe.

He called it tragic for communities to lose obstetricians because of the cost of medical insurance and when substantial portions of health costs go to attorneys' fees.

Hatch's bill would limit court awards for non-economic damage, reduce awards by the amount of other compensation, and limit attorneys contingency fees. He said similar reforms in California have proven effective.