At a time of mounting concerns about health care costs, America’s broken medical liability system stands as a major culprit - raising costs and hampering quality of care for millions. While many states have adopted successful reforms, sky-high medical liability costs remain a significant problem nationally. read more...
The costs of medical liability are exacerbated by the filing of meritless lawsuits. Further, healthcare costs continue to rise because of the practice of “defensive medicine.” In response to increasing medical liability risks, doctors are ordering unnecessary tests and procedures as a way to protect themselves from liability.
And it is not just the cost of healthcare that is affected by medical liability costs - healthcare quality is also impacted. The availability of some higher-risk medical specialties, such as OB-Gyn physicians, is becoming scarce as a result of high insurance premiums resulting from lawsuits.
While Congress has tried to pass meaningful medical liability reform in recent years, many states have successfully lowered their medical costs and increased the availability of care by passing medical liability reforms.
California was a pioneer when in 1975 it passed the Medical Injury Compensation Reform Act (MICRA), which placed a $250,000 cap on non-economic damages in medical malpractice lawsuits and limits on attorney contingency fees. Since its passage, claims in California are settled in one-third less time than in states without caps on non-economic damages. The trial bar unsuccessfully attempted to pass a ballot initiative to remove the caps in 2014.
Many states have passed reforms modeled after MICRA with excellent results. For example, when Texas was facing an extreme shortage of physicians, medical facilities, and soaring medical liability costs, it enacted sweeping medical liability reforms that placed a $250,000 limit on non-economic damages against doctors and healthcare providers and an overall cap of $500,000 against healthcare facilities. Since Texas passed their reforms, lawsuits against hospitals have decreased by more than two-thirds, and the state added more than 80 practicing obstetricians in one year.
Over 20 states have enacted some type of law placing limits on medical malpractice awards:
Alaska, Alabama, California, Colorado, Florida, Georgia, Illinois, Michigan, Missouri, Mississippi, Montana, North Carolina, New Hampshire, Nevada, Ohio, Oklahoma, Pennsylvania, Rhode Island, South Carolina, Texas, Utah, Virginia, Wisconsin, and West Virginia.