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http://ssrn.com/abstract=995270
 
 

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The Impact of Tort Reform on Private Health Insurance Coverage


Ronen Avraham


University of Texas at Austin - School of Law

Max M. Schanzenbach


Northwestern University - School of Law

November 30, 2009

Northwestern Public Law Research Paper No. 07-16
U of Texas Law, Law and Econ Research Paper No. 187
American Law and Economics Review, Forthcoming

Abstract:     
This study evaluates the impact of tort reform on private health insurance coverage using the Current Population Survey’s March Demographic Files. Proponents of tort reform argue that reform will reduce medical malpractice insurance costs, damage awards, and costs associated with defensive medicine. If proponents are correct, these cost reductions should increase health insurance coverage. On the other hand, if the prior tort law was functioning well, reform may increase medical costs by reducing doctors’ care-taking or increasing of the use of aggressive treatments. In this case, tort reform could actually decrease insurance coverage by raising healthcare costs. We evaluate the effect of eight common tort reforms on private health insurance coverage between 1981 and 2007. We find that damage caps, collateral source reform, and joint and several liability reform increased health insurance coverage for the most price-sensitive groups (the single-young and the self-employed) between one-half and one percentage point each. Accordingly, we conclude that tort reform may increase insurance coverage rates for price-sensitive groups, but its overall effect on coverage will be small.

Number of Pages in PDF File: 44

Keywords: tort law, health law, health economics, insurance

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Date posted: June 26, 2007 ; Last revised: May 20, 2010

Suggested Citation

Avraham, Ronen and Schanzenbach, Max M., The Impact of Tort Reform on Private Health Insurance Coverage (November 30, 2009). Northwestern Public Law Research Paper No. 07-16; U of Texas Law, Law and Econ Research Paper No. 187; American Law and Economics Review, Forthcoming. Available at SSRN: http://ssrn.com/abstract=995270 or http://dx.doi.org/10.2139/ssrn.995270

Contact Information

Ronen Avraham (Contact Author)
University of Texas at Austin - School of Law ( email )
727 East Dean Keeton Street
Austin, TX 78705
United States
(512) 232-1357 (Phone)
HOME PAGE: http://www.utexas.edu/law/faculty/profile.php?id=ra22397

Max Matthew Schanzenbach
Northwestern University - School of Law ( email )
375 E. Chicago Ave
Unit 1505
Chicago, IL 60611
United States
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