The Mixed Bag of Medical Malpractice

Photo by Patrick Ladapo Joseph Ladapo

Election 2004 thrust the issue of medical malpractice onto center stage and into the living rooms of American voters. President Bush frequently spoke of “abusive litigation” and the “badly broken [health care] system” Americans would be left with if medical liability reform was not passed. Senator Kerry tried to convince Americans that medical liability was “less than one percent” of health care costs in the United States. Polls showed that more voters were in agreement with Bush, both on this issue and on the question of who would make the better president. The election has since been settled, but debate over medical malpractice continues to simmer.

Access and Cost
Americans worry about health care costs and they worry about access. In the context of medical liability, the latter has received the most attention. Major news stations and newspapers brought us footage of physicians protesting high malpractice costs and holding public demonstrations in New Jersey, Washington, Florida, and Illinois.

In June 2003, Time magazine took up the issue and published an edition replete with accounts from physicians who were limiting their practice or even closing shop entirely in response to skyrocketing malpractice premiums. One physician described how his focus had shifted from medical care to medical lobbying. The magazine’s message was clear: physicians cannot hold office hours and picket signs at the same time.

Despite the media attention, research shows that American anxiety over liability-related access issues may be overstated. Although access problems exist, evidence suggests that the effects of high malpractice costs on access nationwide have been modest. And according to William Encinosa and Fred Hellinger, two economists who recently published a study on the effect of malpractice award caps in Health Affairs, Americans living in rural areas are most at risk when high premiums drive physicians to limit their practice.

Increasingly, physicians are defending patients from illness, while vigorously defending themselves from possible litigation.

There is much controversy regarding the impact of medical
litigation on health care costs. Though the direct costs of medical litigation are relatively minute, attention has focused on how medical malpractice has indirectly changed the medical culture—namely through defensive medicine.

When doctors deviate from the standard of care in order to avoid liability, they are practicing defensively, for better or worse. To be sure, medicine is innately defensive: vaccines defend against infection, medications defend against disease progression or occurrence, and at the brink of death, doctors and nurses defend life. But most medical students can recall instances in which additional tests or measures were taken when neither standard of care nor patient preferences warranted doing so. Increasingly, physicians are defending patients from illness, while vigorously defending themselves from possible litigation.

This self-defense is almost certainly jeopardizing the defense of patients. According to Senate majority leader Dr. Bill Frist, “a liability system intended to promote the highest standards of care, reduce errors, and punish negligence is having the opposite effect.”

“Standards of care” are called that for a reason, and practices that deviate from them, without the support of clinical or even empirical evidence, are often substandard. And even the marginal benefits of additional tests or imaging are not without opportunity costs.

Strengthening the Solution
Most states have undertaken efforts to rein in malpractice premiums, typically by constraining the time after an injury in which a lawsuit may be brought to trial and limiting the share of a malpractice award a lawyer may claim. The measures that have been most controversial, though, are damage caps on pain and suffering—so-called noneconomic damages. In contrast to economic damages, which include lost wages and health care costs, these have been beholden to the unpredictable discretion of juries.

President Bush has made medical malpractice reform a top priority and supports a $250,000 cap on noneconomic damages, an idea that inspired legislation in Congress, now stalled. The majority of states are not waiting, though, and at least 27 of them have passed laws over the past several years that cap noneconomic damages.

Are caps the physician’s elixir? States with caps have generally seen slower growth in malpractice premiums compared with their neighbors, but their premiums have still risen greatly. Recent evidence suggests that noncompetitive and monopolistic behavior on the part of malpractice insurance companies may be just as threatening to premiums as high malpractice awards.

Malpractice is bad for patients, but an unconstrained atmosphere of litigation is a threat to public health. Due process for the individual who is harmed by bad medicine is achievable, and need not be in tension with malpractice reform. As more states adopt reform measures, physicians and policymakers should keep a close watch on insurance markets, balancing their efforts to rein in premiums on both sides of the insurance equation.

—Joseph Ladapo is a Harvard
medical student and a PhD
student in health policy.

The opinions expressed in this column are not necessarily those of Harvard Medical School, its affiliated institutions, or Harvard University.

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