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Sach D. Oliver
Sach D. Oliver
Contributor •

Regulating the Health Care Market

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Tort reform is a touchy subject. Many people argue that tort lawyers who take on medical malpractice claims are just trying to ruin doctors and get rich quick, all while driving up healthcare costs for others. However, looking at actual research, rather than repeating tired dogmas reveals the truth behind this subject.

The actual cost of medical malpractice claims equates to less that 2% of overall healthcare costs.[1] This percentage of spending is arguably low when one considers the benefits provided by this private sector regulation of doctors. In fact, the number of doctors who have ever been responsible for malpractice payments is very low. To be precise, 82% of doctors have never had a malpractice payment.[2] This proves that malpractice claims are much less common than many people think. Further, since 1991, 6% of doctors have been responsible for 58% of malpractice payments.[3]

With these numbers in mind, it is evident that many doctors will go through their entire career and will never be responsible for a malpractice payment. Does this prove that the healthcare market should be subject to less liability? I think that this would lead one to the opposite conclusion. Doctors know that they are subject to liability, and this gives them an incentive to perform adequately. Consumers of healthcare deserve to know which doctors are performing adequately, and those who are injured by inadequate performance deserve to be compensated.

The argument is often heard that those who are compensated force others into higher healthcare costs because doctors are then forced to pay higher premiums, and pass this cost on to the consumer. However, there is little correlation between malpractice premiums and malpractice payouts.[4] Rather, doctors’ premium increases can be attributed to declining interest rates and investments.[5] These are some important considerations for us during these times. Assumptions should not guide us. We should look at the facts of this subject ourselves, and encourage others to do the same.

Our firm believes the overwhelming majority of doctors are wonderful people and fantastic physicians. It is the minority of doctors who are negligent and should be held accountable for their actions.



[1] “Malpractice a Tiny Percentage of Health Care Costs,” available at http://www.justice.org/cps/rde/xchg/justice/hs.xsl/8686.htm, (accessed September 7, 2009).

[2] “By the Numbers- Few Doctors Responsible for Malpractice Payments,” available at http://www.justice.org/cps/rde/xchg/justice/hs.xsl/8692.htm, (accessed September 7, 2009).

[3] Id.

[4] “No Correlation Between Malpractice Payouts and Insurance Premiums,” available at http://www.justice.org/cps/rde/xchg/justice/hs.xsl/8689.htm, (accessed September 7, 2009).

[5] Id.

2 Comments

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  1. Facebook User says:
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    The problem with tort law, is that pharmaceuticals seem to get away with murder. Hundreds of thousands of Americans have been checked into rehabilitation clinics, and thousands have died, at the hands of Oxcontin. The vast majority of these users were *prescribed* the drug at first, quickly became addicted, and watched their life fall apart. Whats worse… our President is peddling a “free meds for all Americans” plan in Congress.

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    The current medical malpractice (medmal) system is woefully inefficient with only 39 cents on the dollar going to claimants. Find out more at http://www.healthcaretownhall.com/?p=1599