Steep Decline In Medical Malpractice Payouts Did Not Reduce Health Costs

November 26, 2013

For over a decade, proponents of tort reform have argued medical malpractice reform is needed to reduce spiraling healthcare costs. If these reforms were implemented, tort reformers promised reduced healthcare costs. Opponents of tort reform argued medical malpractice reforms would have no significant impact on healthcare costs, as medical malpractice lawsuits account for less than 1% healthcare costs. So, who was correct?

According to recent figures, the total number of medical malpractice payouts on behalf of doctor fell to its lowest level in a decade--down 28% since 2003. In addition, the total value of medical malpractice payouts is also significantly down. However, the nation's healthcare expenses did not followed suit. Instead, healthcare costs have risen a startling 58% in the last decade. This confirms that medical malpractice costs have no appreciable impact on healthcare costs. Indeed, if medical malpractice costs were a major driver behind soaring healthcare costs, the substantial reduction in medical malpractice payouts over the last decade should have significantly lower healthcare costs.

In 2012, the total number of medical malpractice payouts was 9,379 compared to 16,565 in 2001. In 2012, the total value of medical malpractice payouts was $3.14 billion versus $4.41 billion in 2003. Despite these significant reductions in medical malpractice payouts, healthcare costs over doubled in the last decade.

As the next national election begins to gather steam, there is no doubt the topic of tort reform will raise its head once again. Politicians primarily on the right will blame medical malpractice lawyers, and trial lawyers in general, for out of control healthcare costs, doctors fleeing the profession, and anything else their pollsters think might resonate. Unfortunately, many people will blindly accept these contentions because they sound familiar and seem to make sense--on the surface. However, those willing to look deeper into these issues will begin to question the veracity of the commonly accepted belief that medical malpractice lawsuits significantly drive up healthcare costs.. Those willing to look deeper will see that, although we do have a problem with rising healthcare costs, medical malpractice lawsuits are neither the problem nor the solution. Unfortunately, this will not stop certain politicians from making these same fallacious arguments--not because they know they think they are right--but because they think they will work.


Sources Used:

MedPage Today, Medical Malpractice Payouts Hit All-Time Low, August 7, 2013

UPI, U.S. Malpractice Lawsuits Less Than 1% Of Healthcare Costs, April 30, 2013.

 
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