Monday, February 18News That Matters

Medical malpractice claims down, payouts up: Study – Business Insurance


The frequency of medical malpractice claims has dropped substantially, but average case management expenses and indemnity payments continue to rise, according to a report.

The rate of medical professional liability claims declined 27% from 5.1 cases per 100 physicians to 3.7 cases from 2007 to 2016, according to a report issued on Tuesday by CRICO Strategies called Medical Malpractice in America: A 10-year Assessment with Insights that examines national trends in claims frequency, payment and root causes of preventable harm. The report analyzed events affecting 124,000 patients.

“For the roughly one million physicians across the country, this trend signals a dramatic change in their risk of being named in an MPL case,” the report stated. “While no single factor can be aligned with an across-the-board reduction, changes in the tort environment, improved patient safety, and increasing financial risk for plaintiffs’ attorneys likely contributed.”

The report highlighted positive trends in the obstetricians/gynecologists specialty, whose physicians historically face higher claim rates than the average of all doctors, with the risk of a claim or lawsuit against these physicians declining 44% to 5.1 cases per 100 physicians, according to the report by the Boston-based company, which is a division of The Risk Management Foundation of the Harvard Medical Institutions Inc.

“Such sustained results demonstrate that initiatives such as training to improve team communication during labor and delivery and multidisciplinary education on fetal heart rate tracings are being rewarded,” the report stated.

But the report highlighted notable trends related to higher costs for managing medical professional liability claims, with average case management expenses increasing by 3.5% annually, reaching $46,000 per case in 2016, outpacing both consumer and legal inflation indices.

“Cases with multiple defendants reflect both the complexity of team-based care (patients encounter more clinicians) and policy limit “stacking” (plaintiffs adding policyholders to an MPL case to increase potential indemnity),” the report stated. “Typically, cases with more defendants require individual legal representation, adding complexity and cost to case management. Beyond legal fees, the use of MPL defense tools (mock trials, computerized renderings, jury studies, witness preparation) is increasing, as are their costs.”

The average time to resolve cases with indemnity did decline from 29 months to 27 months over the 10-year period, indicating that efforts to expedite resolution such as disclosure and apology are having an impact and possibly slowing the growth in case management expenses, according to the report.

Average indemnity payments rose 3% per year to $360,000, a growth rate that outpaced the consumer price index, but fell below medical inflation trends, according to the report.

High-severity injuries such as death or permanent impairment are 41% more likely to lead to an indemnity payment, according to the report.

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