Medical Malpractice Reform: Noneconomic Damages Caps Reduced Payments 15 Percent, With Varied Effects By Specialty

Seabury, Seth A.; Helland, Eric; Jena, Anupam B.

doi:10.1377/hlthaff.2014.0492

Cited by 30 publications

(22 citation statements)

References 42 publications

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“…Other research has shown that paid claims per physician dropped throughout the United States between 1992 and 2012, though slightly more in “new‐cap” states such as Texas (64 percent vs. 57 percent), whereas payouts per large claims increased in “no‐cap” and “old‐cap” states during that period but decreased by 21 percent in “new‐cap” states, with the differences largely attributable to legislative caps on damages (Paik, Black, and Hyman 2013a,b). Researchers have estimated that instituting a $250,000 noneconomic damage cap similar to that in Texas would reduce payouts in malpractice suits against physicians by approximately 20 percent (Seabury, Helland, and Jena ). A sharp drop in claims and payouts following tort reform was also predicted using detailed data from Texas specifically (Hyman et al.…”

Section: Discussionmentioning

confidence: 99%

Resolving Malpractice Claims after Tort Reform: Experience in a Self‐Insured Texas Public Academic Health System

Sage

Harding

Thomas

2016

Health Services Research

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Objective To describe the litigation experience in a state with strict tort reform of a large public university health system that has committed to transparency with patients and families in resolving medical errors. Data Sources/Study Setting Secondary data collected from The University of Texas System, which self‐insures approximately 6,000 physicians at six health campuses across the state. We obtained internal case management data for all medical malpractice claims closed during 1 year before and 6 recent years following the enactment of state tort reform legislation. Study Design We retrospectively reviewed information about malpractice claimants, malpractice claims, and the process and outcome of dispute resolution. Data Collection/Extraction Methods We accessed an internal case management database, supplemented by both electronic and paper records compiled by the university's Office of General Counsel. Principal Findings Closed claims dropped from 244 in 2001–2002 to an annual mean of 96 in 2009–2015, closures following lawsuits from 136 in 2001–2002 to an annual mean of 28 in 2009–2015, and paid claims from 60 in 2001 to an annual mean of 20 in 2009–2015. Patterns of resolution suggest efforts by the university to provide some compensation to injured patients in cases that were no longer economically viable for plaintiffs’ lawyers to litigate. The percentage of payments relating to cases in which lawsuits had been filed decreased from 82 percent in 2001–2002 to 47 percent in 2009–2012 and again to 29 percent in 2012–2015, although most paid claimants were represented by attorneys. Unrepresented patients received payment in 13 cases closed in 2009–2012 (22 percent of payments; mean amount $60,566) and in 24 cases closed in 2012–2015 (41 percent of payments; mean amount $109,410). Even after tort reform, however, claims that resulted in payment remained slow to resolve, which was worsened for claimants subject to Medicare secondary payer rules. Strict confidentiality became a more common condition of settlement, although restrictions were subsequently relaxed in order to further transparency and improve patient safety. Conclusions Malpractice litigation risk diminished substantially for a public university health system in Texas following legal changes that reduced rights to sue and available damages. Health systems operating in a low‐tort environment should work with policy makers, plaintiffs’ attorneys, and patient groups to assist unrepresented patients, facilitate early mediation, limit nondisclosure obligations following settlement, and expedite the resolution of Medicare liens.

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Section: Discussionmentioning

confidence: 99%

Resolving Malpractice Claims after Tort Reform: Experience in a Self‐Insured Texas Public Academic Health System

Sage

Harding

Thomas

2016

Health Services Research

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“…Relief from malpractice pressure will presumably have a bigger impact on a specialty that is sued often versus a specialty that is rarely sued. For example, Seabury, Helland, and Jena (2014) find much larger reductions in payments for medical malpractice suits from reform for ob-gyns relative to most other specialties. So, I would expect to find the biggest effects for ob-gyns, and smaller effects for specialties sued less often or sued for smaller amounts.…”

Section: Theoretical Considerationsmentioning

confidence: 99%

“…1 The most common such reform is a cap on noneconomic damages awardable in medical malpractice tort cases. 2 The argument for damage caps is that they decrease the malpractice risk on providers through decreased litigation and lower settlement amounts (Holtz-Eakin, 2004;Avraham, 2007;Sloan and Chepke, 2008;Friedson and Kniesner, 2012;Paik, Black, and Hyman, 2013;Seabury, Helland, and Jena, 2014), and therefore should decrease malpractice insurance premiums (Thorpe, 2004) an important cost component in the production of health care. 3 Provider cost *Correspondence to: University of Colorado Denver, 1250 14th Street, Denver, CO, USA.…”

Section: Introductionmentioning

confidence: 99%

Medical Malpractice Damage Caps and Provider Reimbursement

Friedson

2015

Health Economics

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A common state legislative maneuver to combat rising healthcare costs is to reform the tort system by implementing caps on noneconomic damages awardable in medical malpractice cases. Using the implementation of caps in several states and large database of private insurance claims, I estimate the effect of damage caps on the amount providers charge to insurance companies as well as the amount that insurance companies reimburse providers for medical services. The amount providers charge insurers is unresponsive to tort reform, but the amount that insurers reimburse providers decreases for some procedures. Copyright © 2015 John Wiley & Sons, Ltd.

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“…There is evidence that caps of $500 000 or more have little effect on malpractice claims. 8 On the other hand, low caps, set at $250 000, may make it impossible for some patients with legitimate cases to find an attorney. A 2009 study by the American Bar Association found that many Texas attorneys reduced the number of malpractice cases they took after the state enacted a $250 000 cap in 2003.…”

Section: Causes Of Recovery Also Unclearmentioning

confidence: 99%