Controlling Large Malpractice Claims: The Unexpected Impact of Damage Caps

Gronfein, William; Kinney, Eleanor D.

doi:10.1215/03616878-16-3-441

Cited by 13 publications

(3 citation statements)

References 7 publications

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“…Gronfein and Kinney (1991) found that paid malpractice claims were actually higher in Indiana, which had a cap on total damages, than in Michigan and Ohio, which did not have such caps. Nonetheless, Indiana still had lower malpractice premiums than Michigan and Ohio had.…”

Section: Research Findings On the Effects Of Damages Capsmentioning

confidence: 92%

Damages Caps in Medical Malpractice Cases

2007

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This article reviews the empirical literature on the effects of damages caps and concludes that the better-designed studies show that damages caps reduce liability insurance premiums. The effects of damages caps on defensive medicine, physicians' location decisions, and the cost of health care to consumers are less clear. The only study of whether consumers benefit from lower health insurance premiums as a result of damages caps found no impact. Some state courts have based decisions declaring damages caps legislation unconstitutional on the lack of evidence of their effectiveness, thereby ignoring the findings of conflicting research studies or discounting their relevance. Although courts should be cautious in rejecting empirical evidence that caps are effective, legislators should consider whether they benefit consumers enough to justify limiting tort recoveries for those most seriously injured by malpractice.

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Section: Research Findings On the Effects Of Damages Capsmentioning

confidence: 92%

Damages Caps in Medical Malpractice Cases

2007

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“…"); Viscusi, Zeckhauser, Born, and Blackmon (1993) (14-percent); Blackmon and Zeckhauser (1991) (30-percent); Sloan, Mergenhagen, and Bovbjerg (1989) (31-percent reduction in insurer payouts); Danzon (1986) (23-percent); Danzon (1984) (19-percent). Gronfein and Kinney (1991) found that a state with a total damages cap (Indiana) had higher payouts than two control states (Michigan and Ohio). Several of these studies have been criticized for "methodological shortcomings."…”

Section: Data Sourcementioning

confidence: 99%

Estimating the Effect of Damages Caps in Medical Malpractice Cases: Evidence from Texas

Hyman¹,

Black²,

Silver³

et al. 2009

Journal of Legal Analysis

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Using claim-level data, we estimate the effect of Texas's 2003 cap on noneconomic damages on jury verdicts, post-verdict payouts, and settlements in medical malpractice cases closed during 1988-2004. For pro-plaintiff jury verdicts, the cap affects 47-percent of verdicts and reduces mean allowed non-economic damages, mean allowed verdict, and mean total payout by 73-percent, 38-percent, and 27-percent, respectively. In total, the non-econ cap reduces adjusted verdicts by $156M, but predicted payouts by only $60M. The impact on payouts is smaller because a substantial portion of the above-cap damage awards were not being paid to begin with. In cases settled without trial, the non-econ cap affects 18-percent of cases and reduces predicted mean total payout by 18-percent. The non-econ cap Downloaded from 356 ~ Hyman, Black, Silver, Sage: Estimating the Effect of Damages Caps in Medical Malpractice Cases has a smaller impact on settled cases than tried cases because settled cases tend to involve smaller payouts. The impact of the non-econ cap varies across plaintiff categories. Deceased, unemployed, and (likely) elderly plaintiffs suffer a larger percentage reduction in payouts than living, employed, and non-elderly plaintiffs.We also simulate the effects of different caps and fi nd substantial differences in cap stringency across states. Different caps reduce aggregate payouts in tried cases (all cases) by between 16-percent and 65-percent (7-percent and 42-percent). Caps on total damages have especially large effects.

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“…This cap, unlike many of those imposed in other jurisdictions Gronfein and Kinney 1991), 23 probably had a negligible effect, because of the extreme rarity of large awards for pain and suffering, and because most of the situations in which such 326 Journal of Health Politics, Policy and Law 23. There is a review of state caps for damages in medical malpractice cases in Bovbjerg and colleagues (1989: 956-958).…”

Section: Other Changes In the Lawmentioning

confidence: 99%

Medical Malpractice in Michigan: An Economic Analysis

Spurr¹,

Simmons²

1996

Journal of Health Politics, Policy and Law

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We analyzed the factors determining the amount of the recovery on claims based on medical malpractice. Our data set, which previously was not explored, consists of 20,428 claims arising within Michigan that were closed between 1978 and 1990. During this period, major changes were made in the law governing malpractice litigation. We determine the effect of these changes and of various other factors affecting medical malpractice claims. We analyze the effect of a statute that was designed to curtail "forum shopping" by attorneys for plaintiffs. This statute was initially successful in curbing such activity, but its effect seems to be diminishing. In addition, we compare mediation awards with settlement payments, and settlement payments with the expected value of claims in litigation. Evidence suggests that a mediation award is the mediation panel's estimate of a settlement payment appropriate for the case, and that cases are settled for substantially less than their expected value at trial.

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Controlling Large Malpractice Claims: The Unexpected Impact of Damage Caps

Cited by 13 publications

References 7 publications

Damages Caps in Medical Malpractice Cases

Damages Caps in Medical Malpractice Cases

Estimating the Effect of Damages Caps in Medical Malpractice Cases: Evidence from Texas

Medical Malpractice in Michigan: An Economic Analysis

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