Liability for Medical Malpractice: Issues and Evidence

Abstract

The past several years have witnessed a considerable increase in the cost and impact of medical malpractice litigation. Between 1994 and 2001, the typical medical malpractice award increased 176 percent to $1 million. The result has been higher malpractice insurance premiums for health care providers, which in turn has led to higher costs for the health care system as well as reduced access to medical services. In 2001, total premiums for medical malpractice insurance topped $21 billion, more than double the amount ten years earlier. This paper presents an analysis of the current medical malpractice system, focusing on the cost and impact excessive litigation has on the affordability and accessibility of health care. Legislative remedies are described, as well as the potential impact of such reforms. Reform of the medical liability system would yield significant benefits, including significant savings on health care spending from a reduction in unnecessary tests and treatments motivated out of fear of litigation. Reform would also encourage systematic reform efforts to identify and reduce medical errors, halt the exodus of doctors from high-litigation states and specialties, and improve access to health care.