NCPA - National Center for Policy Analysis


December 18, 2007

The nation's medical malpractice system should be replaced by a system that automatically compensates patients for unexpected injuries or deaths, regardless of who is at fault, according to a new report from the National Center for Policy Analysis (NCPA). 

The malpractice system is supposed to compensate victims of negligent medical practice for their injuries and discourage future errors by medical providers.  It does both jobs poorly, says the NCPA:

  • Fewer than 2 percent of patients (or the families of patients) who are negligently injured ever file a malpractice lawsuit and even fewer receive compensation.
  • Of the lawsuits filed, fully one out of every three cases does not involve any medical error.
  • Malpractice victims receive less than half of every dollar (46 cents) recovered through settlements or jury verdicts; the rest goes to pay their attorneys' fees, court administrative costs and defense costs.

The current system also imposes large costs on doctors.  One in every four physicians is sued every year, and more than half are sued at least once during their career.  And to protect against such lawsuits, doctors purchase malpractice insurance, which carries high premiums, most of which are passed on to all patients. 

To help stem this problem, the tort-law malpractice system should be replaced with a system in which liability would be determined by voluntary contract.  These contracts could include:

  • Compensation without fault -- set in advance the amount a provider is obligated to compensate the patient (or family of the patient).
  • Adjustment for risk -- allow the compensation amount to be reduced for the riskier patient or high-risk procedures.
  • Full disclosure -- require providers to make certain quality information public, such as mortality rates for surgeries.
  • Patient compliance -- base qualification for full compensation on the patient's compliance with certain provider directives, including diet restrictions, full discloser of medications being taken.

Source: Pamela Villarreal, John C. Goodman and Joe Barnett, "Medical Malpractice Reform," Backgrounder No. 163, National Center for Policy Analysis, December 17, 2007.

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