At the House Public Safety Committee hearing today, state Rep. Stephen Frost asked Department of Public Safety Director Steve McCraw whether there is any evidence that Texas’ Driver Responsibility Program (DRP) improves public safety or has increased the number of drivers with insurance. McCraw’s answer: “No sir, not at all.” No hesitation. No equivocation. From his perspective, this is merely a revenue generator. It was a rather startling moment.
In response to Frost’s queries, I put in a card at the last minute and clarified for the members that all of the 1.2 million drivers who lost their licenses because of the DRP were by definition uninsured because they couldn’t purchase insurance without a valid license. I also relayed some information that was included in written testimony (which I helped prepare) on behalf of the Texas Criminal Justice Coalition regarding the societal costs in safety and treasure of creating that many additional uninsured drivers:
The 1.2 million Texas drivers who have lost their licenses over surcharges cannot buy insurance until their fees are paid, but large numbers (if not virtually all) of them continue to drive.
Particularly problematic, DWI defendants who lose their license and insurance may also continue to drive, and if they harm someone the DRP makes it less likely they will have insurance to cover the damages. Since drunk drivers have the highest surcharges, they are also most likely to fail to pay and thus end up unlicensed and uninsured. Despite claims to the contrary at the time it was passed, the surcharge has resulted in more uninsured drunks on Texas roads, rather than reducing their number.
In 2007, there were 6,024,000 crashes5 in the United States and 205,741,845 licensed drivers, giving us an overall accident rate of 2.93%. If we assume those 1.2 million surcharge debtors who lost their licenses (and therefore became ineligible to purchase insurance) continued to drive, and that they crash at the same rate as other drivers, then by reducing the number of insured drivers, drivers who lost their license through the DRP are involved in approximately 35,160 accidents per year. If DRP drivers were the responsible party in half of those accidents (a conservative estimate, as drivers with bad driving histories could be more likely to be at fault), then the DRP would be responsible for an additional 17,580 accidents per year in which the party at fault is not insured.
How much do those crashes cost Texans in uncompensated damages? It is possible to estimate. In 2000, a federal study analyzed costs from auto accidents, including medical costs, property damage, etc., attributing $230.6 billion in costs to 16.4 million auto accidents nationwide, at an average cost of $14,061 per accident. Adjusting for inflation, that’s $16,777 in 2007 dollars. Multiplying that figure by the number of estimated crashes caused involving surcharge owing drivers, we get an estimated $294,939,660 in costs from crashes in Texas caused by uninsured drivers.
Add in lost premium income to insurers, not to mention lost Department of Public Safety (DPS) fees from the more than 200,000 fewer driver license renewals each year (roughly $4.8 million annually), and nearly every facet of the Driver Responsibility Program is bleeding red ink – for the state and for average Texans – because of an array of unintended but now well-understood consequences from the program’s ill-conceived design. (Footnotes in original.)
Trauma hospital reps were out in force at the hearing, but only one of them unreservedly supported the DRP as is; most other said they recognized the program’s funding source had problems that needed addressing, but were there to emphasize how important the additional funding had been to expanding the number of Texas trauma centers. I spoke to a couple of folk from Brackenridge and Seton Hospitals in Austin outside the hearing room who told me they didn’t intend to oppose the current DPS rulemaking, which was encouraging.
I don’t begrudge trauma hospitals their funding, but a revenue source should be found that doesn’t create so many counterproductive, unintended consequences.
