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New Trend Reports Speak to the Nation’s Broken Medical Liability System

January 31, 2018

The American Medical Association (AMA) has released a new series of trend reports in its Policy Research Perspective series that looks at the price Americans pay for the nation’s medical liability system. Key findings reveal:

  • The average cost of administering or adjudicating a medical liability claim was $54,165 during 2015, 65 percent more than during 2006
  • More than two-thirds of claims were dropped, dismissed or withdrawn, but still cost an average $30,475 to defend
  • Only seven percent of claims were decided by a trial verdict, and the vast majority were won by the defendants
  • Despite increasing stability in liability premiums, more premiums have increased than decreased since 2015

AMA President David Barbe, M.D. noted that despite the fact that the vast number of claims are dropped, dismissed or withdrawn, “the heavy cost associated with a litigious climate takes a significant financial toll on our health care system when the nation is working to reduce unnecessary health care costs.”

Within the series, the first report analyzes medical liability claims frequency among patient care physicians in the U.S. The report emphasizes that getting sued is virtually a matter of when, not if, for physicians. Highlights in the report include:

  • More than a third of physicians (34 percent) have had a claim filed against them at some point in their careers.
  • Because older physicians have been in practice for a longer time and thus have had more exposure, the probability of getting sued increases with age. Nearly half (49.2 percent) of physicians age 55 and over have been sued, compared to 8.2 percent of physicians under age 40.
  • Before they reach the age of 55, more than 50 percent of general surgeons and obstetricians/gynecologists have already been sued. 

The second report analyzes indemnity payments, expenses, and claim disposition based on a sample of medical liability claims that closed between 2006 and 2015 aggregated by PIAA, the association representing the medical and health care professional liability insurance community.

An indemnity payment is money paid to a claimant/plaintiff for adjudicated damages. Expenses are defense and cost containment expenses incurred in the process of administering or adjudicating a claim, such as for defense attorneys and expert witnesses.

The third report analyzes annual changes in medical liability insurance premiums for 2008–2017.

HAP continues to work with the Pennsylvania Medical Society, the American Hospital Association (AHA), and as a member of the Pennsylvania Coalition for Civil Justice, to advocate for medical liability reforms.

At the federal level, HAP, along with the AHA, lobbied successfully for U.S. House passage of H.R. 1215—Protecting Access to Care Act—which would provide comprehensive medical liability reform. The U.S. Senate did not consider the measure. HAP also secured the support of ten members of the Pennsylvania congressional delegation in cosponsoring legislation—H.R. 548—Health Care Safety Net Enhancement Act—that would provide liability relief for emergency providers.

For additional information about HAP’s state and federal advocacy efforts around medical liability reform, contact Laura Stevens Kent, HAP’s vice president, federal legislative advocacy, or Scott Bishop, HAP’s senior vice president, legislative advocacy.

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