Medical Malpractice payouts amount to less than 1% of health care costs

As many Florida  residents are well aware, efforts have been underway in our state and others to limit the rights of those who are harmed by medical malpractice. Many lawmakers tout reforming the medical malpractice system as a way for states to get health care expenses under control, but a new study out of Johns Hopkins suggests that those efforts are misguided.  The results of the study conclude that medical malpractice claims are virtually a non-issue when it comes to health care costs. The researchers find that “catastrophic” (payouts over $1 million) malpractice payments make up less than 1% of medical expenditures in the United States.
Read: American College of Chest Physicians article on the 5 Myths of Medical Malpractice
œThe notion that frivolous claims are routinely resulting in $100 million payouts is not true, says study leader Marty Makary, M.D., M.P.H… Makary says the data suggest that the focus of legal reform efforts should be on doctor protections aimed at reducing defensive medicine rather than the creation of malpractice caps.
The study catagorized  what type of injuries called for larger payouts.  For example, payouts over $1 million are more likely to occur when a patient who is killed or injured is under the age of 1; develops quadriplegia, brain damage or the need for lifelong care as a result of the malpractice; or when the claim results from a problem related to anesthesia, the researchers found in a study published online in the Journal for Healthcare Quality.
Makary and his colleagues reviewed nationwide medical malpractice claims using the National Practitioner Data Bank, an electronic repository of all malpractice settlements or judgments since 1986. They looked at data from 2004 to 2010, choosing a 2004 start date because that is when data regarding the age and gender of patients and severity of injury became available for the first time. The information includes only payments made on behalf of individual providers, not hospitals or other corporations, meaning the number of payouts may be underestimated by 20 percent, Makary says.
The most common allegations associated with a catastrophic payout were diagnosis-related (34.2 percent), obstetrics-related (21.8 percent) and surgery-related (17.8 percent) events. Errors in diagnosis showed twice the odds of a catastrophic payout compared with equipment- or product-related errors and were associated with a roughly $83,000 larger payment.
The age of the physician was unrelated to the likelihood of a claim, suggesting inexperience is not necessarily a factor. But 37 percent of catastrophic payouts involved a physician with a previous claim in the database. The largest payout in the study was $31 million.
Makary says the data suggest that the focus of legal reform efforts should be on doctor protections aimed at reducing defensive medicine rather than the creation of malpractice caps.   He says his findings argue for more research to determine what interventions might prevent the type of errors that result in catastrophic payouts, with the overall goal of improving patient safety and reducing costs at the same time.  But real cost reductions, he says, will come from reducing the overuse of diagnostic tests and procedures.
This research is very important as it debunks a major myth about medical malpractice. Medical malpractice claims are not typically frivolous–much to the contrary, they are necessary so that victims of doctor’s errors are not unfairly financially burdened as a result of the injuries that they suffered.
Medical News Today: Catastrophic malpractice payouts add little to health care’s rising cost     
 Claims Journal: Catastrophic malpractice payouts add little to healh care costs