Medical Liability, Managed Care, and Defensive Medicine
35 Pages Posted: 22 Aug 2000
There are 2 versions of this paper
Medical Liability, Managed Care, and Defensive Medicine
Medical Liability, Managed Care, and Defensive Medicine
Date Written: February 2000
Abstract
Because the optimal level of medical malpractice liability depends on the incentives provided by the health insurance system, the rise of managed care in the 1990s may affect the relationship between liability reform and defensive medicine. In this paper, we assess empirically the extent to which managed care and liability reform interact to affect the cost of care and health outcomes of elderly Medicare beneficiaries with cardiac illness. Malpractice reforms that directly reduce liability pressure - such as caps on damages - reduce defensive practices both in areas with low and with high levels of managed care enrollment. In addition, managed care and direct reforms do not have long-run interaction effects that are harmful to patient health. However, at least for patients with less severe cardiac illness, managed care and direct reforms are substitutes, so the reduction in defensive practices that can be achieved with direct reforms is smaller in areas with high managed care enrollment. We consider some implications of these results for the current debate over the appropriateness of extending malpractice liability to managed care organizations.
JEL Classification: K32
Suggested Citation: Suggested Citation
Do you have a job opening that you would like to promote on SSRN?
Recommended Papers
-
The Effects of Malpractice Pressure and Liability Reforms on Physicians' Perceptions of Medical Care
-
The Effects of Malpractice Pressure and Liability Reforms on Physicians' Perceptions of Medical Care
-
The Effect of Malpractice Liability on the Delivery of Health Care
By Katherine Baicker and Amitabh Chandra
-
The Causes and Effects of Liability Reform: Some Empirical Evidence
By Thomas J. Campbell, Daniel P. Kessler, ...
-
Returns to Local-Area Health Care Spending: Using Health Shocks to Patients Far from Home
-
Medical Malpractice and Physician Liability: Examining Alternatives in Defensive Medicine