The Effects of Malpractice Suits on Health Care

There is much debate about the impact medical lawsuits and malpractice insurance have on health care. According to a 2004 report conducted by the Congressional Budget Office (CBO), "medical malpractice makes up only 2% of U.S. health care spending." While health care cost containment is an important economic issue, other related considerations include the protection of patients' rights and the true comprehensive impact of malpractice lawsuits.

The Patient's Right to Justice

• Given the possibility for harm, and even death, when medical personnel make mistakes, the American legal system offers injured patients the right to sue. With a large number of preventable medical errors made each year, many argue that the medical community should be held accountable. Statistics support the fact that many medical errors are preventable. A study conducted from 2002 to 2007 in 10 hospitals found that medical errors contributed to a significant number of patient injuries and deaths. In this study, the records of 2,341 patients' were reviewed. The study reported that 18 percent of patients were harmed and 63.1 percent of those injuries were preventable. More disturbing than the injury rates, 2.4 percent of the patients in the study died as a direct, or indirect, result of medical error.

Defensive Medicine's Role in the Health Care Costs Debate

• The practice of ordering unnecessary tests in an effort to limit possible litigation is called defensive medicine and is blamed by many in the medical community as a major reason for the rise in health care costs. Dr. Steven M. Sayfer, CEO of Montefiore Medical Center, estimates that he spends 5 percent on defensive medicine annually. Counter to Dr. Sayfer's point of view, the CBO came up with much lower figures in a 2004 study related to defensive medicine costs. The CBO also pointed out the possibility that defensive medicine "might be motivated more by the income it generates than the fear of legal action."

A Doctor's Perspective on Malpractice Lawsuits

• According to Dr. Hugh Francis III, a vascular surgeon at Memphis Surgery Associates, "too many medical malpractice suits are being filed." With doctors paying as much as 20 percent of their salary for malpractice insurance, it is no surprise that they are interested in seeing these premiums decrease. While the financial cost of malpractice legal action is center stage, other non-financial effects are also cited by doctors as negative consequences of lawsuits and high malpractice insurance premiums. In addition to the financial burden of increased insurance premiums, the high cost of insurance also influences which specialty a doctor pursues, the practice's location selection and, ultimately, whether to join or leave the workforce. Doctors suggest that a shortage of certain specialists in specific, low-desirability geographic areas could result from increased malpractice premiums.

Health Care Costs and Malpractice Lawsuits

• With different agendas being forwarded in the ongoing debate over the true cost associated with malpractice lawsuits and higher insurance premiums, finding the truth is challenging. There is no argument about malpractice insurance premiums increasing rapidly. Physicians complain about high insurance premiums, seeking regulations to keep premiums down and citing higher premiums as a major culprit to be blamed for higher health care costs. Health economists and independent legal experts don't agree with the doctors, claiming that medical malpractice claims are only a small, insignificant part of the problem.