Medical Malpractice Tort Reform
Doctors' groups, patients, and insurance companies have criticized medical malpractice litigation as expensive, adversarial, unpredictable, and inefficient. [12] They claim that the cost of medical malpractice litigation in the United States has steadily increased at almost 12 percent annually since 1975.[13] Jury Verdict Research, a database of plaintiff and defense verdicts, says awards in medical liability cases increased 43 percent in 1999, from $700,000 to $1,000,000.
These critics assert that these rate increases are causing doctors to go out of business or move to states with more favorable tort systems.[14] Not everyone agrees, though, that medical malpractice lawsuits are solely causing these rate increases. A 2003 report from the General Accounting Office found multiple reasons for these rate increases, with medical malpractice lawsuits being the primary driver.[15] Despite noting multiple reasons for rate increases, the report goes on to state that the "GAO found that losses on medical malpractice claims-which make up the largest part of insurers’ costs-appear to be the primary driver of rate increases in the long run."
The major tort reform proposals have been:
- Special medical malpractice courts
- Limits on noneconomic damages
- Reduction in the statute of limitations of action
At the same time, studies of these claims have found[16][17][18][19] that there is no problem of increasing malpractice verdicts and insurance costs driving doctors out of business.
Malpractice has both direct and indirect costs, including "defensive medicine." Studies place the direct and indirect costs of malpractice between 5% and 10% of total U.S. medical costs, as described below:[20]
About 10 percent of the cost of medical services is linked to malpractice lawsuits and more intensive diagnostic testing due to defensive medicine, according to a January 2006 report prepared by PricewaterhouseCoopers LLP for the insurers’ group America’s Health Insurance Plans...The figures were taken from a March 2003 study by the U.S. Department of Health and Human Services that estimated the direct cost of medical malpractice was 2 percent of the nation’s health-care spending and said defensive medical practices accounted for 5 percent to 9 percent of the overall expense."