Advanced Search
MyIDEAS: Login

The Welfare Effects of Medical Malpractice Liability

Contents:

Author Info

  • Darius N. Lakdawalla
  • Seth A. Seabury
Registered author(s):

    Abstract

    Policymakers and the public are concerned about the role of medical malpractice liability in the rising cost of medical care. We use variation in the generosity of local juries to identify the causal impact of malpractice liability on medical costs, mortality, and social welfare. The effect of malpractice on medical costs is large relative to its share of medical expenditures, but relatively modest in absolute terms—growth in malpractice payments over the last decade and a half contributed at most 5.0% to the total real growth in medical expenditures, which topped 33% over this period. On the other side of the ledger, malpractice liability leads to modest reductions in patient mortality; the value of these more than likely exceeds the cost impacts of malpractice liability. Therefore, policies that reduce expected malpractice costs are unlikely to have a major impact on health care spending for the average patient, and are also unlikely to be cost-effective over conventionally accepted ranges for the value of a statistical life.

    Download Info

    If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
    File URL: http://www.nber.org/papers/w15383.pdf
    Download Restriction: no

    Bibliographic Info

    Paper provided by National Bureau of Economic Research, Inc in its series NBER Working Papers with number 15383.

    as in new window
    Length:
    Date of creation: Sep 2009
    Date of revision:
    Handle: RePEc:nbr:nberwo:15383

    Note: HC HE PE
    Contact details of provider:
    Postal: National Bureau of Economic Research, 1050 Massachusetts Avenue Cambridge, MA 02138, U.S.A.
    Phone: 617-868-3900
    Email:
    Web page: http://www.nber.org
    More information through EDIRC

    Related research

    Keywords:

    Find related papers by JEL classification:

    This paper has been announced in the following NEP Reports:

    References

    References listed on IDEAS
    Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
    as in new window
    1. Katherine Baicker & Amitabh Chandra, 2005. "The Effect of Malpractice Liability on the Delivery of Health Care," NBER Chapters, in: Frontiers in Health Policy Research, Volume 8 National Bureau of Economic Research, Inc.
    2. Dubay, Lisa & Kaestner, Robert & Waidmann, Timothy, 2001. "Medical malpractice liability and its effect on prenatal care utilization and infant health," Journal of Health Economics, Elsevier, vol. 20(4), pages 591-611, July.
    3. Paul H. Rubin & Joanna M. Shepherd, 2007. "Tort Reform and Accidental Deaths," Journal of Law and Economics, University of Chicago Press, vol. 50, pages 221-238.
    4. Boskin, Michael J, et al, 1997. "The CPI Commission: Findings and Recommendations," American Economic Review, American Economic Association, vol. 87(2), pages 78-83, May.
    5. Ashenfelter, Orley & Greenstone, Michael, 2002. "Using Mandated Speed Limits to Measure the Value of a Statistical Life," IZA Discussion Papers 571, Institute for the Study of Labor (IZA).
    6. David A. Matsa, 2007. "Does Malpractice Liability Keep the Doctor Away? Evidence from Tort Reform Damage Caps," The Journal of Legal Studies, University of Chicago Press, vol. 36(S2), pages S143-S182, 06.
    7. Ernst R. Berndt & David M. Cutler & Richard G. Frank & Zvi Griliches & Joseph P. Newhouse & Jack E. Triplett, 1998. "Price Indexes for Medical Care Goods and Services: An Overview of Measurement Issues," Harvard Institute of Economic Research Working Papers 1851, Harvard - Institute of Economic Research.
    8. Eric Helland & Mark H. Showalter, 2009. "The Impact of Liability on the Physician Labor Market," Journal of Law and Economics, University of Chicago Press, vol. 52(4), pages 635-663, November.
    9. Janet Currie & W. Bentley MacLeod, 2008. "First Do No Harm? Tort Reform and Birth Outcomes," The Quarterly Journal of Economics, MIT Press, vol. 123(2), pages 795-830, 05.
    10. Lisa A. Robinson, 2007. "Policy Monitor How US Government Agencies Value Mortality Risk Reductions," Review of Environmental Economics and Policy, Association of Environmental and Resource Economists, vol. 1(2), pages 283-299, Summer.
    11. Mickael Löthgren & Niklas Zethraeus, 2000. "Definition, interpretation and calculation of cost-effectiveness acceptability curves," Health Economics, John Wiley & Sons, Ltd., vol. 9(7), pages 623-630.
    12. Patricia M. Danzon, 1991. "Liability for Medical Malpractice," Journal of Economic Perspectives, American Economic Association, vol. 5(3), pages 51-69, Summer.
    13. Eisenberg, Theodore, et al, 1997. "The Predictability of Punitive Damages," The Journal of Legal Studies, University of Chicago Press, vol. 26(2), pages 623-61, June.
    14. Viscusi, W Kip & Aldy, Joseph E, 2003. " The Value of a Statistical Life: A Critical Review of Market Estimates throughout the World," Journal of Risk and Uncertainty, Springer, vol. 27(1), pages 5-76, August.
    15. Kessler, Daniel & McClellan, Mark, 2002. "Malpractice law and health care reform: optimal liability policy in an era of managed care," Journal of Public Economics, Elsevier, vol. 84(2), pages 175-197, May.
    16. Kessler, Daniel P. & McClellan, Mark B., 2002. "How liability law affects medical productivity," Journal of Health Economics, Elsevier, vol. 21(6), pages 931-955, November.
    17. repec:reg:rpubli:282 is not listed on IDEAS
    18. Alberto Abadie & Guido W. Imbens, 2008. "On the Failure of the Bootstrap for Matching Estimators," Econometrica, Econometric Society, vol. 76(6), pages 1537-1557, November.
    19. Daniel P. Kessler & Mark McClellan, 1996. "Do Doctors Practice Defensive Medicine?," NBER Working Papers 5466, National Bureau of Economic Research, Inc.
    20. Dubay, Lisa & Kaestner, Robert & Waidmann, Timothy, 1999. "The impact of malpractice fears on cesarean section rates," Journal of Health Economics, Elsevier, vol. 18(4), pages 491-522, August.
    21. Kessler, Daniel & McClellan, Mark, 1996. "Do Doctors Practice Defensive Medicine?," The Quarterly Journal of Economics, MIT Press, vol. 111(2), pages 353-90, May.
    22. Mark Pauly & Christy Thompson & Thomas Abbott & James Margolis & William Sage, 2006. "Who Pays? The Incidence of High Malpractice Premiums," NBER Chapters, in: Frontiers in Health Policy Research, Volume 9 National Bureau of Economic Research, Inc.
    23. Moller, Erik K & Pace, Nicholas M & Carroll, Stephen J, 1999. "Punitive Damages in Financial Injury Jury Verdicts," The Journal of Legal Studies, University of Chicago Press, vol. 28(2), pages 283-339, June.
    24. Jonathan Klick & Thomas Stratmann, 2007. "Medical Malpractice Reform and Physicians in High-Risk Specialties," The Journal of Legal Studies, University of Chicago Press, vol. 36(S2), pages S121-S142, 06.
    25. Pauly Mark & Thompson Christy & Abbott Thomas & Margolis James & Sage William, 2006. "Who Pays? The Incidence of High Malpractice Premiums," Forum for Health Economics & Policy, De Gruyter, vol. 9(1), pages 1-19, December.
    26. Jennifer Arlen & W. Bentley MacLeod, 2005. "Torts, Expertise, and Authority: Liability of Physicians and Managed Care Organizations," RAND Journal of Economics, The RAND Corporation, vol. 36(3), pages 494-519, Autumn.
    27. Kevin M. Murphy & Robert H. Topel, 2006. "The Value of Health and Longevity," Journal of Political Economy, University of Chicago Press, vol. 114(5), pages 871-904, October.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as in new window

    Cited by:
    1. Friedson, Andrew I. & Kniesner, Thomas J., 2011. "Losers and Losers: Some Demographics of Medical Malpractice Tort Reforms," IZA Discussion Papers 5921, Institute for the Study of Labor (IZA).

    Lists

    This item is not listed on Wikipedia, on a reading list or among the top items on IDEAS.

    Statistics

    Access and download statistics

    Corrections

    When requesting a correction, please mention this item's handle: RePEc:nbr:nberwo:15383. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: ().

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If references are entirely missing, you can add them using this form.

    If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.