We know that taking frivolous and unfounded medical malpractice cases out of the courts, before they are filed and cost money, is a way to reduce the cost of healthcare.
The recent New England Journal of Medicine study found the same thing. The study said that many—37 percent—malpractice cases did not involve errors and three percent did not involve any injuries. And most of the claims that were not the result of errors or injuries did not result in compensation.
When compensation was paid, 54 cents of every dollar spent in cases that did not involve error went to administrative expenses, including those involving lawyers, experts and courts.
To me, perhaps the study’s greatest use is that it will spark further discussion that can lead to a realistic solution. But I have some concerns about the sample that the Journal employed.
The study’s authors note that 30 percent of the defendants were trainees, including residents, fellows and interns. But according to the National Practitioner Data Bank 2004 Report, interns and residents accounted for less than 1 percent of all malpractice payment reports. The authors admit that academic institutions were overrepresented in the sample and created an inherent limitation in the study.
But, given the preponderance of physicians-in-training in the sample, it is difficult to make a conclusion about the true error / total claim rate across the country. Those with the least amount of training would be more likely to make more true errors both in planning and execution.
Next, the data appears to be based on a claim as defined from the plaintiff's perspective; that is, there is one claim no matter how many defendants. That’s not the way typical medical malpractice cases work. A legitimate claim is actually more likely to have multiple defendants, for example, the referring physician, the emergency room physician, the surgeon, the radiologist, the anesthesiologist, etc.
Many were eventually dropped, but here's the problem: Each individual physician was required to defend himself or herself until the case was dismissed, which means the defense costs were likely increased beyond what was reported in the study. The study concludes only that legitimate claims with payout were associated with true error. What is missing are those who did not err, were sued, and were dropped when the physician responsible was identified later in the proceedings.
Third, medical malpractice litigation is a function of state law. It is hard to make broad conclusions pooling data from different regions when the environments affecting economic incentives to initiate suit, settle, or go to court are so different from state to state.
Finally, the fact that payment was made in 19 percent of claims with little-to-no evidence of error and 32 percent in a slight-to-modest evidence of error is evidence enough that the tort system is woefully inadequate from the physician's perspective. Add into that the fact that the median time to closure was five years.
It is no wonder that physicians will have incentives to order tests and perform procedures to avoid being sued, regardless of whether such tactics work or not. That cost almost certainly outweighs the total cost of professional liability premiums physicians' pay in the United States.
It is helpful to think about a group – a large group - not mentioned in the study. There are currently 46 million uninsured Americans. Improving the medical malpractice system would lessen the costs of defensive medicine, which would provide a stable source of funding for health insurance – and better healthcare and a better quality of life -- for every American.