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Tort reform and physician labor supply: A review of the evidence

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  • Helland, Eric
  • Seabury, Seth A.

Abstract

There is a large empirical literature examining the relationship between medical liability reform and the supply of physician services. Despite the general consensus that malpractice reform leads to an increase in physician supply, usually targeted amongst a subset of physicians, debates rage at the state level over the effectiveness of any given reform. This paper reviews the evidence on the relationship between tort reform and physician supply and assess the implications for any given state. Although our difference in difference methodology prevents drawing conclusions about the impact of reforms on overall physician supply, we find that noneconomic damage caps increase the supply of physicians in high risk specialties. However, these effects, even for the high risk specialties, vary significantly across states. It is unclear whether these differences represent heterogeneous treatment effects across states, or simply random error in the estimates. New approaches are needed to estimating state-specific effects of tort reform to have the most impact on local policy debates.

Suggested Citation

  • Helland, Eric & Seabury, Seth A., 2015. "Tort reform and physician labor supply: A review of the evidence," International Review of Law and Economics, Elsevier, vol. 42(C), pages 192-202.
  • Handle: RePEc:eee:irlaec:v:42:y:2015:i:c:p:192-202
    DOI: 10.1016/j.irle.2015.01.005
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    References listed on IDEAS

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    Cited by:

    1. Hyman, David A. & Silver, Charles & Black, Bernard & Paik, Myungho, 2015. "Does tort reform affect physician supply? Evidence from Texas," International Review of Law and Economics, Elsevier, vol. 42(C), pages 203-218.
    2. Michael D. Frakes & Matthew B. Frank & Seth A. Seabury, 2017. "The Effect of Malpractice Law on Physician Supply: Evidence from Negligence-Standard Reforms," NBER Working Papers 23446, National Bureau of Economic Research, Inc.
    3. Eric Helland & Anupam B. Jena & Dan P. Ly & Seth A. Seabury, 2016. "Self-insuring against Liability Risk: Evidence from Physician Home Values in States with Unlimited Homestead Exemptions," NBER Working Papers 22031, National Bureau of Economic Research, Inc.
    4. repec:eee:irlaec:v:50:y:2017:i:c:p:7-14 is not listed on IDEAS

    More about this item

    Keywords

    Physician labor supply;

    JEL classification:

    • I11 - Health, Education, and Welfare - - Health - - - Analysis of Health Care Markets
    • G22 - Financial Economics - - Financial Institutions and Services - - - Insurance; Insurance Companies; Actuarial Studies
    • K13 - Law and Economics - - Basic Areas of Law - - - Tort Law and Product Liability; Forensic Economics

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