The Purpose Of Medical Liability

Heart disease and cancer are the leading causes of death in the United States. This doesn’t come as news for many Americans. However, many would be shocked to learn that medical error is the third leading cause of death, just before respiratory disease.

This situation begs the question, how is medical error policed? How is it monitored and prevented, ideally? What are the repercussions for such mistakes? How are families compensated for fatal medical errors that lead to the loss of a loved one? Or, for less grave errors that don’t result in death but still incur some injury, how is the victim compensated? The answer to these questions, generally speaking, is medical liability. Medical liability functions to maintain the standard of care which all providers ought to adhere to. When successfully litigated, medical negligence suits secure compensation for the injured party. Public policy has its own considerations with regard to medical liability.

Over the years legislators have contended with the effects of poking and prodding at the delicate, interconnected medical liability system, at times throwing the system into whack or subduing a thriving landscape of tort suits. Where public policy is concerned, medical liability ought to serve these aforementioned functions in their purest form, however, they must account for the myriad unintended consequences wrought by the medical tort system. Furthermore, legislators must try to draft policy which stems these unintended, unwelcome consequences while not infringing on medical liability’s premier functions. There are obvious pros and cons to the system of holding providers financially accountable for their errors, some of which legislators have not been able to entirely prevent despite their best efforts.

In every medical malpractice suit, the standard of care comes into question. At the heart of every case is a factual dispute concerning whether or not the healthcare provider did all that was professionally and reasonably expected of them under the circumstances. Because the standard of care is a legal term and not necessarily a medical one, this emphasizes its function as a tool to scrutinize and appraise the provider’s performance. By its very nature, medicine is exceptionally complicated, with intricacies very difficult for the average person to grasp. This means that regulation of medicine is mostly an internal affair, with professionals creating and reaching a consensus on what constitutes best and customary practices. Not to say this state of affairs makes for sloppy, inadequately regulated medicine – on the contrary. However, medical malpractice suits remain a critical point at which these customary practices go under scrutiny. Medical malpractice court decisions often reassert or assert anew particular standards of care which had been the subject of the dispute. Going forward after every medical malpractice decision, there are many implications and effects on the customary practices in that particular field. Medical liability has a sort of tailoring mechanism on the standard of care, making adjustments to areas that gave rise to issues. Beyond that, it is also a punitive instrument of sorts, ensuring that explicit medical negligence and failures will not go unpunished or unnoticed, thereby deterring more of them in the future. In any discussion of the purpose of medical liability, these functions must be stated – maintaining a quality of standards and punishing acts of medical negligence.

Pursuing claims of medical negligence and forcing a negligent provider to pay is not a contained affair – it has far reaching effects, outside of the courtroom and beyond the provider’s/their insurance company’s pocketbook. Legislators must be abreast of these consequences to legislate effectively. When a claim goes to trial, leading to a substantial payout for the injured claimant, the insurance company will pay the damages on behalf of the defendant physician. However, a higher frequency of high dollar amounts for damages meant that liability insurance premiums would steadily rise. Doctors would pass these costs along to patients. In turn, health care costs would rise. More expensive health care means more expensive health insurance. Higher health insurance premiums meant fewer people could afford to be insured. States have the explicit power to legislate all matters regarding insurance, so medical liability became an area of particular concern. A wave of tort reform came in the 1970’s and 1980’s wherein legislatures attempted to take an ax to existing tort law, and create provisions that were in step with the times. Keeping a weathered eye on the ability to obtain affordable health insurance, states began imposing various limitations of medical tort suits, which had become extravagantly expensive – not only for the damages they could award but also the simple costs of litigating such claims. With public interest in mind, but necessarily the interest of injured plaintiffs, states began imposing damage caps. Damage caps operate in the questionable logic that there is a fixed monetary amount that can compensate any injury, no matter how grave or severe. A handful of states firmly held that damage caps were unconstitutional, while others imposed very low damage caps in the hope that it would draw more physicians to that state. Another tactic used to curb high liability premiums: some states adopted the use of an injured patient compensation fund, which would cover any tort damages after a given amount. This way, physicians would only be required to hold an insurance policy up to that amount. There is special concern exhibited in public policy toward mitigating the negative effects of medical liability.

It remains difficult to fully assess and analyze the real impact of these legislative efforts on the frequency of tort suits. Data may be skewed by the sheer number of physicians per capita in a given state, and tort suits may appear more frequent in states that simply have more physicians. “Subtle dimensions of policy changes are difficult to quantify…many policy changes are interrelated, making it difficult to isolate the effects of individual changes.” Balancing the interests of plaintiff and defendant is ever a difficult endeavor. To cite an example from Duke’s study: “Long statutes of limitations are designed to protect victims of latent injuries, but they create nondiversifiable risk for insurers that issue occurrence policies in a volatile legal climate. Compensation for risk-bearing must, in turn, be reflected in premiums.”

Politics aside, the most obvious function of medical liability is to secure compensation for injured parties. Rippling effects aside, it accomplishes this task rather well. Successfully proven claims see an average payout $242,000. Like many other conundrums facing the healthcare industry, this may seem like an extravagant cost but it is also fundamental to the integrity of the system.