- Removing the threat of medical liability results in less intensive treatment without harming patients, a new working paper by the National Bureau of Economic Research concludes.
- Researchers compared active-duty patients who are barred from suing military facilities for treatment they receive with dependents who can sue such facilities for malpractice as well as both groups of patients when they receive care in civilian facilities.
- When doctors are immune from liability they order fewer tests and procedures, reducing inpatient spending by 5% with “no measurable negative effect on patient outcomes,” according to the study.
Doctors worry about malpractice lawsuits and frequently complain about the high costs of malpractice insurance. To protect themselves in a litigious environment, many practice “defensive medicine” to reduce the risk of being accused of providing incomplete care. But such extra care rarely improves health outcomes and can even harm patients while driving up costs.
In a 2014 survey of hospital administrators, respondents suggested that a third of healthcare costs are tied to defensive medicine and estimated that about 60% of doctors practice defensive medicine. More than two-thirds said the practice hurts hospitals’ financial performance.
In another survey published in Academic Emergency Medicine, 97% of emergency physicians admitted pursuing diagnostic tests that were medically unnecessary because of the fear of errors and uncertainty about patients’ conditions.
Congress has attempted to provide malpractice relief. Last year, lawmakers in the House passed the Protecting Access to Care Act, which would cap noneconomic damages in malpractice litigation at $250,000 and limit the fees lawyers can charge in healthcare lawsuits. It would also protect providers from liability in lawsuits involving an FDA-approved drug or medical device.
According to a Congressional Budget Office analysis, the measure would save taxpayers $50 billion over 10 years by discouraging superfluous lawsuits and preempting states with higher or no limits on damages.
The NBER paper suggests that “a ‘safe harbor’ policy with guidelines that are set at the ‘natural’ point of treatment intensity (e.g. the point at which patient would be treated if they could not sue) could yield results similar to those that we estimate here. Guidelines set at the prevailing norm, however, which incorporates existing defensive medicine effects, have an ambiguous effect. These latter guidelines may provide certainty against lawsuits, which may reduce defensive pressures; however, that certainty may come at the cost of excessive medical delivery among those below the prevailing standard.”