Stability, Not Crisis: Medical Malpractice Claim Outcomes in Texas, 1988-2002

54 Pages Posted: 25 Oct 2005 Last revised: 28 Jan 2015

Bernard S. Black

Northwestern University - Pritzker School of Law; Northwestern University - Kellogg School of Management; European Corporate Governance Institute (ECGI)

Charles Silver

University of Texas at Austin - School of Law

David A. Hyman

Georgetown University

William M. Sage

University of Texas at Austin School of Law; University of Texas at Austin - Dell Medical School

Date Written: October 2005

Abstract

Using a comprehensive database of closed claims maintained by the Texas Department of Insurance since 1988, this study provides evidence on a range of issues involving medical malpractice litigation, including claim frequency, payout amounts, defense costs, and jury verdicts. The data present a picture of stability in most aspects and moderate change in others. We do not find evidence in claim outcomes of the medical malpractice insurance crisis that produced headlines over the last several years and led to legal reform in Texas and other states. Controlling for population growth, the number of large paid claims (over $25,000 in real 1988 dollars) was roughly constant from 1990-2002. The number of smaller paid claims declined. Controlling for inflation, payout per large paid claim increased over 1988-2002 by an estimated 0.1 percent insignificant) -0.5 percent (marginally significant) per year, depending on the data set, but actual payouts in tried cases showed little or no time trend. Real defense costs per large paid claim rose by 4.2-4.5 percent per year. Real total cost per large paid claim, including defense costs, rose by 0.8-1.2 percent per year.

The prior working paper version of this paper is available at http://ssrn.com/abstract=678601. The working paper version contains color figures, which were converted to black and white in the published version.

Suggested Citation

Black, Bernard S. and Silver, Charles and Hyman, David A. and Sage, William M., Stability, Not Crisis: Medical Malpractice Claim Outcomes in Texas, 1988-2002 (October 2005). as published in 2 Journal of Empirical Legal Studies, pp. 207-259 (2005); Columbia Law and Economics Working Paper No. 287; U Illinois Law & Economics Research Paper No. LE05-002; U of Texas law, Law and Econ Research Paper No. 030. Available at SSRN: https://ssrn.com/abstract=770844

Bernard S. Black (Contact Author)

Northwestern University - Pritzker School of Law ( email )

375 E. Chicago Ave
Chicago, IL 60611
United States
312-503-2784 (Phone)

Northwestern University - Kellogg School of Management

2001 Sheridan Road
Evanston, IL 60208
United States
847-491-5049 (Phone)

European Corporate Governance Institute (ECGI)

Brussels
Belgium

Charles M. Silver

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

727 East Dean Keeton Street
Austin, TX 78705
United States
512-232-1337 (Phone)
512-232-1372 (Fax)

David A. Hyman

Georgetown University ( email )

Washington, DC 20057
United States

William Matthew Sage

University of Texas at Austin School of Law ( email )

727 East Dean Keeton Street
Austin, TX 78705
United States

University of Texas at Austin - Dell Medical School ( email )

Austin, TX 78712

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