Medical Device Daily Washington Editor

WASHINGTON – Results from a new study seem to strengthen the evidence that caps on malpractice awards increase patient access to physician care.

The study was conducted by William Encinosa, PhD, and Fred Hellinger, PhD, senior economists with the Agency for Healthcare Research and Quality (AHRQ; Rockville, Maryland), part of the U.S. Department of Health and Human Services (HHS).

According to the study’s findings, states that have capped malpractice lawsuit awards have seen a larger growth in the number of practicing physicians than states without such caps, especially in rural areas.

“This study contributes to the growing foundation of evidence underpinning efforts to reform malpractice laws in this country,” Carolyn Clancy, MD, director of AHRQ, said in a statement. “This research will help inform states as they work to balance the concerns of physicians and the need to ensure access to services for their citizens.”

Between 1970 and 2000, the number of physicians per 100,000 residents more than doubled in the 13 states that enacted caps on non-economic damages during the 1980s, compared to an 83% physician growth rate in the 23 states that didn’t cap malpractice awards before 2000, according to Encinosa and Hellinger.

The researchers found that the dollar amount of the cap also had an impact on the supply of physicians, especially in rural areas. Between 1975 and 2000, the growth in the median number of rural physicians per 100,000 residents in states with caps of $250,000 was 9% higher than in states with caps above $250,000.

Currently, 27 states have caps on malpractice awards. Of those, five states have caps with a $250,000 limit.

Surgeons and obstetrician/gynecologists – who are most likely to be sued and who often pay the highest malpractice premiums – were the specialists most likely to be affected by caps of $250,000.

The median number of surgical specialists per 100,000 people increased by 41% for states with caps of $250,000, but only by 31% for states with caps above $250,000.

For obstetrician/gynecologists per 100,000 women ages 15 to 44, the increases are 61% in states with caps of $250,000 and 49% for states with higher caps.

The study used county-specific data maintained by HHS. Researchers compared physician supply in 49 states, excluding Alaska and the District of Columbia, from 1985 to 2000 to study the impact of the malpractice caps.

Caps generally increased physician supply by 2% to 3% three years after adoption, after accounting for other factors that impact physician supply such as socioeconomic, political, cultural, and regulatory factors.

Other factors the study took into account that could impact the demand for physicians included HMO and Medicare enrollment, whether the county has a medical school, disease rates and the county’s birth rate.

The administration of President George Bush has made healthcare tort reform one of its most important goals in a second term. The White House’s plan would put a limit of $250,000 on non-economic damages, which also means the pain and suffering portions of malpractice awards. There would be no imposed limits on economic losses suffered as the result of what the Bush administration calls “legitimate medical error.”

The president’s proposal would allow malpractice awards to be paid out over time, instead of in a lump sum, in addition to limiting the time in which such suits could be filed after malpractice is claimed.

Opponents of tort-reform legislation argue that caps harm patients that suffer most harm and need the most help. The study acknowledged that recent evidence suggest that caps may be regressive and hurt low-wage workers, women and the elderly, or “those who rely on the noneconomic damages portion of malpractice awards for adequate compensation.”

Tort-reform opponents also claim that caps on malpractice claims serve only to shield doctors and companies that provide substandard healthcare or products. The real problem, according to lawyers who represent malpractice victims, is insurers who look to raise premiums, which affects the healthcare spending for individuals and companies.

Proponents charge that high malpractice claims are driving physicians out of business or force them to move to states without caps.

Early in 2003, the House of Representatives passed a bill limiting damages awarded in malpractice cases. Similar legislation has been introduced but never passed in the Senate. Since then Congress has yet to take any action, despite continued support for the legislation from the White House.