MALPRACTICE INSURANCE RATES AND
MALPRACTICE LAWSUITS

The Connection Between Malpractice Insurance Rates and Malpractice Lawsuits

Although malpractice insurance rates have decreased recently, the amount of lawsuits are still high and the push for reform has not made much of a difference.

The Medical Liability Monitor (MLM) reported that rates have lowered for medical professionals such as general surgeons, internists and obstetrician-gynecologists. For physicians, the number of malpractice payments have dropped significantly for nine consecutive years according to the National Practitioner Data Bank. The American Medical Association (AMA) has also reported a drop in malpractice litigation claims by as much as fifty percent since the early 2000s.

According to some medical organizations, the drop in malpractice insurance premiums can be attributed to efforts in medical liability tort reform. It’s been said that tort reforms can positively affect health insurance premiums in general, as they lower the extent of defensive medicine and medical malpractice premiums.

Although we have seen decreases in premiums of malpractice insurance, the decline has not necessarily offset the amount of increases experienced during the medical liability crisis. It would be nice to see safe harbors for the practice of evidencebased medicine in order to improve healthcare services and ultimately reduce costs. The main goal of tort reform is to offer incentives to medical professionals who deliver quality patient care. On the other hand, any negligence by a professional will impose additional costs. Tort reforms can reduce the liability of health care providers, thus, damage awards are also limited.

Through proposed bills, patients are often indirectly asked to accept limitations on their legal rights to claim for malpractice damage, and in return they receive lower medical costs. Evidently, health care consumers believe that the high cost of health services are linked to the rising cost of medical malpractice insurance.

We can’t say for certain what the actual root cause of high malpractice rates are and whether or not they are directly related to lawsuits. What many of us can agree upon, however, is that rates are still relatively high for the majority of medical professionals. Currently, tort reforms do not seem to be making a difference.