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Medical Malpractice Payouts – The Facts

Diederich Healthcare has completed their annual compilation of medical malpractice payouts report to the National Practitioner Data Bank (NPDB). The National Practitioner Data Bank (NPDB) is a federal data bank of information about health care providers in the United States, and requires notice of any payout that follows a written demand of payment sent to a medical practitioner.

image for medical payouts

Diederich Healthcare has designed a five page infographic that visually interprets the data collected from 2001 – 2013, including charts and tables for total payout amounts by dollars, state, biggest changes, per capita amounts, settlements vs. judgments, patient type, and type of allegation.

To view the entire infographic, click here.

Some interesting statistics from the study include:

  • Most payouts (96% in 2013) take place from a settlement, as opposed to taking the case to trial.
  • There’s very little variation by state from one year to the next, but big variation among states.
  • The total number and amount of payouts rose in 2013 for the first time since 2003.

Why do doctors settle?

The report says, “ the high settlement figure is due to sample bias — doctors presumably agree to settle cases where their negligence is more obvious, and fight cases where they are more confident that they did nothing wrong. In part the high settlement figure is part of the moral hazard of insurance – doctors often tire of the emotional drain of a lawsuit, and signal a desire to settle (after all, the payout is insurers’ money and doesn’t come out of the physicians’ own pockets) – and insurers are loathe in many cases to make enemies of doctors, who could sue them for bad faith if a very bad verdict occurs at trial.”

The statistics are followed by some observations by the author. He states, “More work remains to be done here, obviously. There are so many questions to answer: How much under-reporting to the NPDB (whether legal or illegal) goes on? Is there a tradition of reporting in some states (New York?) but not in others? Why is New York so seemingly different from every other state? Do statutes inadvertently skew results? [South Carolina, for instance, mandates mediation before any medical malpractice suit – some settlements that take place during that time might not be reported, as no “written demand” has necessarily taken place.] And, of course, per capita payout is not the same as per practitioner payout — some jurisdictions (perhaps DC, MD (Johns Hopkins), etc.) have a much greater concentration of practitioners serving out-of-state residents than do others, and this could skew results.

The data is presented in various ways in order to address concerns with the collected information. For example, a few really big settlements or judgments could skew results, especially for smaller states. While the study certainly provides much needed statistics and information regarding malpractice payouts, more analytical work needs to be done to better interpret the data.

Written By: Vince Pravato

Posted on June 9, 2014 in Medical Malpractice, News, Personal Injury

 

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