Assessing the Tort Signal: Does the Legal System Affect Physician Behavior Through Its Deterrence Structure?

The medical malpractice tort system is theoretically the primary incentive source of maintaining acceptable levels of injury in health care through its assumed deterrence effect. This effect is based upon two important assumptions: physician knowledge of the system's rules and communicatory methods and the application of the same standard of adjudication as understood by both the physicians affected by the structure and the lay agents who apply it. In addition, another model of deterrence is one that does not assume knowledge of the legal rule nor use the same standard of adjudication. Instead, this model assumes that physicians can simply predict the jury verdicts correctly and thus will respond appropriately to its incentives. Thus, in this model, the primary assumption is that physicians can in fact accurately predict the adjudicatory results. A survey method was employed to test these assumptions at a single academic medical center. Physicians in this study, anesthesiologists, were interviewed by the author and asked in an open-ended fashion their understanding of the legal standard of negligence as well as their source of malpractice knowledge (Part I). Further, they were asked to evaluate 12 actual jury verdicts cases as Negligent, Most Likely Negligent, Can't Tell, Most Likely Not Negligent, and Not Negligent (these responses were assigned Likert values of 5, 4, 3, 2 and 1, respectively) (Part II, first administration). At least three months later, Part II was sent to these same physicians for their re-assessment, and at that time, they were asked to predict the actual jury verdict (Part II, second administration). Part II, second administration was also given to 12 non-physicians/non-lawyers (NPNLs) for their assessment. In Part I, physicians were found to be limited in their knowledge of the legal system and its communicatory method. This knowledge did not appear to be related to their years of experience. In Part II, for cases where a non-Can't Tell responses was given, physicians assessed the cases as juries did 58% and 56% of the time (Part II, first and second administrations, respectively); these were strikingly consistent in their relative agreement and Likert values, both of which were not statistically different between administrations. NPNLs made similar relative assessments to physicians at 59% concordance with jury verdicts. Both physicians and NPNLs were significantly different from juries in this respect. Over all cases, physicians predicted jury verdicts correctly only 57% of the time; NPNLs predicted jury verdicts correctly 64% of the time, but the difference between these figures did not rise to the level of statistical significance. Over gray area cases ("Can't Tell" cases), physicians predicted jury verdicts correctly only 55% of the time; however, NPNLs predicted gray area cases correctly 96% of the time, statistically indistinguishable from juries. Thus, because of significant deficiency of physician knowledge of the incentive structure, the divergence in assessment of physicians and actual jury verdicts, and the ability of NPNLs with no medical or legal training to predict as well as or better than physicians overall and in the important gray area cases, there appears to be a significant divergence of the medical malpractice tort incentive structure from the ideal assumed by legal and economics researchers. These departures from the ideal may lead to defensive medicine and paradoxically expose patients to inoptimal levels of iatrogenic injury.