The Impact of Information Technology and Communication on Medical Malpractice Lawsuits

Abstract

Health care organizations have substantially invested in Health Information Technology (HIT) as part of an effort to improve quality. However, many hospitals fail to generate positive returns on this significant investment, based on reimbursements for quality measures through the Affordable Care Act (ACA). Given the high cost of lawsuits, we investigate if HIT adoption reduces lawsuits, and their attendant costs, as another consideration in HIT payoffs. We use operational transparency theory to develop hypotheses on the individual and joint impact of HIT and communication quality in influencing patients’ likelihood to file a lawsuit. We combine data on 168 hospitals in the state of Florida from 2007 to 2011 in order to investigate these relationships. Analysis using a fractional response model indicates that HIT has a direct impact in reducing the number of lawsuits, this effect being higher for hospitals with higher communication quality scores. These results remain consistent irrespective of the type of caregiver (physician vs nurse) communicating with the patient or the severity of injury resulting in the lawsuit. Our results also remain robust under different operationalization of key independent variables and alternate model specifications. These results provide a better understanding of the mechanisms that reduce lawsuits.

The Impact of Health Information Technology on Hospital Performance: A Systematic Integrative Literature Review

“…We found seven performance indicators [17] [21] [27] [33] [40] [50] that do not fit within the four previously mentioned dimensions. For example, number of lawsuits, [17] malpractice insurance premium [21], and reuse of data [33]. We bundled these performance indicators into the category "other".…”

“…Patient engagement HIT describes functionalities such as patient monitoring or telehealth [16]. Administrative HIT describes functionalities such as ERP systems that integrate and manage various administrative and financial processes within hospitals [1] [3] [17]. For an overview of types of HIT functionalities in hospitals, see Figure 2.…”

Electronic prescription monitoring and the opioid epidemic

“…For example, Sharma et al. (2019) showed that the use of HIT systems reduced the number of legal lawsuits against providers. In particular, hospitals with higher adoption levels were more effective at reducing lawsuits.…”

“…Finally, compliance with mandated HIT systems such as PDMP also offers providers protection against liability claims. For example, Sharma et al (2019) showed that the use of HIT systems reduced the number of legal lawsuits against providers. In particular, hospitals with higher adoption levels were more effective at reducing lawsuits.…”

“…Specifically, state laws vary in their degree of immunity grants, which protect providers from civil and criminal liability if they fail to review the PDMP data prior to prescribing. Legal actions against overprescribers have recently received increased attention in the media, and the liability costs associated with such action can be particularly high (Sharma et al., 2019). Immunity grants protect providers against such punitive outcomes.…”