An empirical and critical look at the current medical liability crisis.

KAREN IGNAGNI'S ARTICLE, "Moving Beyond the Blame Game," has a most laudable goal-to bring malpractice costs under control while "protecting patients and improving the quality of care that they can expect to receive." Clearly a serious crisis with the system of insuring, adjudicating, and compensating claims for medical injury exists, and reforms are in order. The question is, what are the real causes of the crisis and what are the best solutions? This commentary explores the current debate about the factors contributing to the problem and also offers some principles for designing solutions. Medical malpractice has proven to be an explosive and difficult political issue with a policy debate characterized by mythology and ideology. Much mythology exists with respect to the identification of the causes of the problems with the malpractice system. Much ideology exists with respect to the articulation of solutions to the problem. THE CAUSES OF THE CRISIS The debate over the causes of the current crisis in medical liability insurance is extraordinarily shrill. Providers, insurers, and conservative tort reformers tend to downplay the role of insurance market dislocation and highlight the conduct of the trial bar and its successes in a highly polemical manner. The trial bar champions the causes of patients but resists approaches to streamline the adjudication and compensation systems and downplays the problems and costs of the current system. Without doubt, there are serious problems with the current common law tort system, many of which have existed for years (Weiler et al. 1993). Medical liability insurance-the chief financing source for compensating medical injury claims-is neither affordable nor available in many states. Journalistic reports and testimony before Congress and state legislatures indicate that physicians cannot afford medical liability insurance and are limiting services, moving to other states, or leaving practice altogether (Committee on Energy and Commerce 2003; Subcommittee on Commercial and Administrative Law 2002). The frequency and severity of malpractice claims has increased in recent years, contributing to the crisis (Tillinghast-Towers Perrin 2003). The crisis in the affordability and availability of medical liability insurance is a response to factors influencing insurance company income. Insurers made high profits on investment income during the 1990s particularly when the stock market and economy were doing well (Zimmerman and Oster 2002; Kolodkin 2001). They lowered premiums to increase market share, making up losses on the underwriting side with gains on the investment side. Then the stock market and interest rates dropped and several extraordinarily large verdicts occurred; in response, many medical liability insurers raised premiums or left the market altogether. Furthermore, there is also evidence of a high incidence of medical injury in the American healthcare system. In its report, To Err Is Human, the Institute of Medicine (IOM 2000) reported findings of empirical research that medical "errors" cause between 44,000 and 98,000 deaths annually in U.S. hospitals. The IOM report has precipitated considerable interest in patient safety, particularly in healthcare institutions. While this interest will no doubt have a great impact on reducing the incidence of medical injury in the future and, hopefully, the frequency and severity of medical liability claims, the data do indicate that a problem exists with medical injury in our healthcare system and that much of that medical injury goes uncompensated. Furthermore, empirical studies of tort litigation in general indicate that, given the extent of negligent conduct in society generally, there may well be too few rather than too many lawsuits seeking compensation for negligent conduct (Galanter 1996). The Selective Use of Evidence in Framing the Problem The debate over defensive medicine exemplifies one major problem with the debate over causes and solutions for the current medical malpractice crisis. …