Study finds that neither claims nor jury verdicts account for recent increases in insurance premiums
AUSTIN, Texas — Recent spikes in medical malpractice premiums in Texas were not caused by rising payouts on claims or rising jury verdicts, according to a study released today by the Center on Lawyers, Civil Justice, and the Media at The University of Texas at Austin School of Law.
The study, "Stability, Not Crisis: Medical Malpractice Claim Outcomes in Texas, 1988-2002," was authored by Professors Bernard S. Black (The University of Texas), Charles Silver (The University of Texas), David A. Hyman (The University of Illinois), and William M. Sage (Columbia University).
Using a unique, comprehensive dataset maintained by the Texas Department of Insurance that includes all insured closed medical malpractice claims for 1988-2002, the authors found that, adjusted for general inflation and population, the number of large paid claims (more than $25,000 in 1988 dollars), payout per large claim, total payout per year on all large paid claims, and jury verdicts all showed no time trend. Only defense costs per large paid claim rose significantly, by 4.4 percent per year, adjusted for inflation, leading to a 1 percent per year increase in the total cost to insurers (payout plus defense cost) per large paid claim. Their findings, with these adjustments, are as follows.
Because litigation outcomes were reasonably stable, other forces must account for most of the steep medical malpractice insurance premium increases seen after 1998, most likely insurance market dynamics.
"Stability, Not Crisis: Medical Malpractice Claim Outcomes In Texas, 1988-2002" will appear in the July 2005 issue of the Journal of Empirical Legal Studies, a peer-reviewed journal. To download a copy, visit http://ssrn.com/abstract=678601. For additional information visit http://www.utexas.edu/law/academics/centers/clcjm/. The study was sponsored by the Center on Lawyers, Civil Justice, and the Media at The University of Texas at Austin School of Law, and the Jon David and Elizabeth Epstein Program in Health Law and Policy at The University of Illinois College of Law.
Streaming Video of the Medical Malpractice Press Conference Now Available in Windows Media Format: http://realaudio.cc.utexas.edu:8080/asxgen/law/depts/media/Reels/PressConference.wmv
(Requires Windows Media Player)
The New York Times Op-Ed: Black, Silver, and Co-Authors on Medical Malpractice Claims: http://www.utexas.edu/law/news/2005/031005_nytimes.html
Center on Lawyers, Civil Justice, and the Media: http://www.utexas.edu/law/academics/centers/clcjm/
Author biographies: http://www.utexas.edu/law/academics/centers/clcjm/project2_authors.html