Medical Malpractice Reform

37 Pages Posted: 17 Mar 2015 Last revised: 26 Apr 2015

See all articles by Ronen Avraham

Ronen Avraham

Tel Aviv University - Buchmann Faculty of Law; University of Texas at Austin - School of Law

Max M. Schanzenbach

Northwestern University - Pritzker School of Law

Date Written: March 17, 2015


The purpose of this chapter is to assess the theoretical and empirical evidence regarding the efficacy of medical malpractice liability and limitations to it in achieving better healthcare outcomes, and to identify the unresolved issues that merit further attention from scholars. First, we will explore the theoretical and legal background on medical malpractice. Our discussion here is just a sketch of the issues, but it lays out the basic framework from which most scholars have worked. We next turn to the available empirical evidence by focusing on three basic areas of study: (1) the impact of malpractice limitations on payouts and litigation; (2) the effect of malpractice limitations on overall healthcare costs; and (3) the effect of malpractice on two major cost drivers in the healthcare system: cardiac and obstetrics practice. We conclude that limitations on liability did not, and likely cannot, significantly reduce healthcare costs. Finally, we discuss new and important trends in the literature regarding reforms to standards of care and the role of clinical practice guidelines as well as communication and disclosure programs. There is some evidence that healthcare providers are very sensitive to the legal standard of care, and correctly setting the standard of care is one of the greatest challenges faced by the healthcare system. Thus, standard setting in conjunction with medical liability has potential to improve medical treatment.

Suggested Citation

Avraham, Ronen and Schanzenbach, Max Matthew, Medical Malpractice Reform (March 17, 2015). F. Parisi (ed.), Oxford Handbook of Law and Economics (Oxford Univ. Press, Forthcoming), U of Texas Law, Law and Econ Research Paper No. E558, Northwestern Public Law Research Paper No. 15-23, Northwestern Law & Econ Research Paper No. 15-08, Available at SSRN: or

Ronen Avraham (Contact Author)

Tel Aviv University - Buchmann Faculty of Law ( email )

Ramat Aviv
Tel Aviv, 69978

University of Texas at Austin - School of Law ( email )

727 East Dean Keeton Street
Austin, TX 78705
United States
(512) 232-1357 (Phone)


Max Matthew Schanzenbach

Northwestern University - Pritzker School of Law ( email )

375 E. Chicago Ave
Chicago, IL 60611
United States

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