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Catastrophic Medical Malpractice Payouts in the U.S.

An analysis of medical malpractice payouts of $1 million or more over a seven year period was recently published. It found that these catastrophic medical malpractice awards accounted for nearly 8% of all paid malpractice claims, and were most often associated with infants; quadriplegia, brain damage, or lifelong care; and anesthesia.

Annual catastrophic payouts averaged $1.4 billion, but this figure represented only 0.05% of total health expenditures in the U.S.  The study was based on the National Practitioner Data Bank that includes details on malpractice payouts on behalf of physicians or other individual providers; malpractice claims against hospitals or other institutions are not covered by the Data Bank. Consequently, total national payouts may be underestimated by about 20%, according to the researchers.

The researchers conclude that defensive medicine rather than ‘frivolous’ malpractice awards may be the more costly concern. According to Marty Makary, one of the Johns Hopkins researchers, “It is not the payouts that are bankrupting the system — it’s the fear of them.” He estimates defensive medicine costs $60 billion annually for too many tests and procedures.

Sources:

Bixenstine PJ and others. Catastrophic medical malpractice payouts in the United States. Journal for Healthcare Quality, published first online, Mar. 29, 2013, at http://onlinelibrary.wiley.com/doi/10.1111/jhq.12011/abstract

‘Catastrophic’ malpractice payouts add little to health care’s rising costs. Johns Hopkins Medicine news release, May 1, 2013. http://www.hopkinsmedicine.org/news/media/releases/catastrophic_malpractice_payouts_add_little_to_health_cares_rising_costs

Posted by AHA Resource Center (312) 422-2050, rc@aha.org

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