Effects of Malpractice Pressure and Liability Reforms on Physicians' Perceptions of Medical Care, The

We present four findings. First, physicians from states enacting liability reforms that directly reduce malpractice pressure experience lower growth over time in malpractice claims rates and in real malpractice insurance premiums. Second, physicians from reforming states report significant relative declines in the perceived impact of malpractice pressure on practice patterns. Third, individual physicians' personal experiences with the malpractice system are a key determinant of the perceived importance of defensive medicine: Physicians who have had a malpractice claim filed against them, particularly a recent claim, are more likely to report changes in practices as a result of malpractice pressure than physicians who have not. Fourth, the impact of individual physicians' claims experience on perceptions is smaller in reforming than in nonreforming states. Taken together, these results suggest that reforms in law affect physicians' attitudes, both by reducing the probability of an encounter with the liability system, and by changing the nature of the experience of being sued for those physicians who defend against malpractice claims. These results validate our previous research by illustrating how reforms change physician incentives. Our 1996 study showed that reforms changed physician behavior, but stopped short of investigating the mechanism by which reforms altered medical practices.57 Our current results, however, indicate that mechanisms commonly cited by physicians in anecdotal reports namely the frequency and severity of malpractice claims may play an important role in fostering defensive medical practices. Reforms appear to affect practices particularly through their impact on the attitudes of physicians who experience lawsuits. In this paper, we did not explicitly model why attitudes of physicians who are sued in states with reforms are less dramatically affected [*pg 106] than attitudes of physicians in states without reforms.58 However, the differences we find here suggest that malpractice claims are less onerous in states with reforms, providing a foundation for their differential impact on physician attitudes. In addition, our results suggest that physician surveys do relate to actual behavior. The fact that state-level reforms both reduce measures of malpractice pressure and reduce physician perceptions of the impact of malpractice pressure suggest that survey methods provide valid measures of defensive practices. Nonetheless, further investigation of the extent of the validity of survey methods will be a fruitful topic of further research. Because the format of the 1984 and 1993 questions regarding the impact of malpractice pressure on practice patterns were not comparable,59 we needed to assume that impact of the change in the questions' terms was uncorrelated with physicians' personal characteristics and uncorrelated with geographic area in order to identify the impact of law reforms on relative changes in the rates of reported malpractice-pressure-induced changes in behavior. Future research might investigate the validity of our assumption, or might seek to replicate our results with comparable survey questions. In addition, our results suggest that physician surveys do, in part, measure negative feelings about the malpractice system, or unobserved differences across physicians, rather than the targeted issue of the impact of malpractice pressure on perceptions and practice patterns. Malpractice claims history has a strong positive correlation with perceived changes in malpractice-pressure-induced changes in practices, and more recent history is more strongly correlated with perceived changes than is less recent history. Future research might investigate the extent to which these findings represent actual changes in practices, rather than the well-studied problem of response bias.