Medical Malpractice in Michigan: An Economic Analysis

Abstract

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.

Cultures of Claiming: Local Variation in Malpractice Claim Frequency

“…New York may be different from other states. However, two Michigan studies have also found some evidence of in‐state variation (Southwick & Young 1992; Spurr & Simmons 1996).…”

“…Nor did they look for evidence that variations were durable over time. A later study by Spurr and Simmons (1996) looked only at a single Michigan county. It found that Wayne County's share of the state's malpractice claims (46.5–43.1 percent) was nearly twice as large as its share of the state's population (25.2–22.7 percent).…”

Male and Female Recoveries in Medical Malpractice Cases

“…Forum Shopping is a practice whereby plaintiff's lawyers contrived various pretexts to file claims in counties where damage awards tend to be higher, such as the Wayne County, Detroit metropolitan area(Spurr and Simmons 1996).REVIEW OF SOCIAL ECONOMY…”