Different River

”You can never step in the same river twice.” –Heraclitus

March 2, 2005

Malpractice Abuse Limits Access to Care

Filed under: — Different River @ 2:23 am

If you don’t believe that the current medical malpractice situation adversely affects patients, see this story about a region of southern Illinois that spent an entire year trying to find a neurosurgeon to replace the last two, who left due to a “hostile medical malpractice climate.”

Telling quote from the hospital administrator: “I didn’t think we’d be able to do it this rapidly.”

(Hat tip: Kevin, M.D.)

While trying to preserve the right to sue, and suing for as much money as possible, people forget that you can’t actually force doctors to practice any particular medicine in any particular state — or even to practice medicine at all, for that matter. If you make the malpractice situation bad enough, doctors will leave.

(This is not the first instance I’ve seen of this — just the first since I started this blog not too long ago. It happens all the time.)

Lest you think that malpractice claims are the result of incompetent or negligent practice of medicine (“bad doctors”), keep in mind that bad doctors have, on average, no more claims against them than anybody else. Look at it this way: if malpractice claims were the result of bad doctoring, then bad doctors would have higher claims (on average) than good doctors, and therefore would pay higher rates for their malpractice insurance — just as “bad drivers” (those with lots of accidents) pay more for auto insurance. This is called “experience rating” — your claims experience affects the rate you pay. But medical malpractice insurance is not generally experience-rated — a given doctor’s premium depends only on his/her specialty and ZIP code.

There is no law or regulation that prohibits experience-rating in medical malpractice insurance. The lack of experience rating is an outcome of a market process. Surely, if past malpractice claims were a good statistical predictor of future claims, insurance companies could increase their profits by offering discounts to doctors with fewer claims, thus attracting more “good risks” into their pool (that is, more customers from whom they’d collect premiums but for whom they’d not have to pay claims). This would, in turn, force premiums up for “bad doctors” and encourage doctors to practice better medicine to avoid insurance rate increases.

However, this doesn’t happen — insurance companies have not found it profitable to take case histories (as they do for drivers) to determine which doctors are likely to be sued. This means that, essentially, malpractice claims are a random event, statistically unrelated to bad medical care. Sure, some claims are due to incompetent or negligent doctors or hospitals — but not enough, percentage-wise, to make it possible to identify bad doctors or hospitals through their malpractice claims, or to use that information to set insurance rates. This shows that the malpractice problem is systemic, and is the due to a faultly legal system rather than bad doctors.

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