The Myth About Defensive Medicine

Dan Frith

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The health care system in this country has problems. The one point we can all agree on is that it just costs too darn much. The system’s other flaws, and the reasons why it costs so much, are all controversial issues. To some extent, one’s opinions about the whys and wherefores of the price depend on one’s political beliefs. This is odd, as there is no real reason why opinions about gun control or the morality of capital punishment should necessarily correlate with pricing issues.

In any event, it is an article of faith among tort “reformers” that medical care is expensive in large part due to an explosion in medical malpractice claims. A subset of this belief is the idea that legal liability causes doctors to perform unnecessary tests and procedures to protect themselves from meritless lawsuits. This is known in medical circles as practicing “defensive medicine.” Is this really the case? To take this claim from the realm of opinion to that of fact we have to break it down into series of questions to see if there is evidence to support them. Let’s do that and see what we find.

With any empirical question, an early task has to be deciding what data we can collect, and how to measure it. Few doctors face direct personal legal liability for their treatment choices. This is because most doctors are insured, with any actual malpractice judgments paid by a third-party insurer.

Many studies of the effects of torts on health care pricing use medical malpractice premiums as a proxy for the costs of the tort system. If defensive medical practices are motivated by a desire to keep premiums low, then we would expect to see fewer of these practices in states which have capped tort payouts. We should also see lower premiums, or at least a slower increase in premiums, in states which have limited tort damages. Also, for legal action to be the primary driver of increases in malpractice insurance payouts, we would need to see an explosion in either the number of successful claims, the damage awards from those claims, or a mixture of the two. Do we see such an increase? No, we do not.

A study of malpractice claims in Texas 1988-2002 found, correcting for inflation and population growth, a decline in the number of small claims (those under $25,000) and that the number of large claims had remained the same. Moreover, the amounts of paid claims only increased by 0.8-1.2 percent per year. As for the effects of capping tort claims, one national study found that while payouts did decline in the nineteen states that then had caps, premiums in capped states rose far faster than those in uncapped states. In states with statutory caps, the median annual premium increased almost fifty percent, while those states without caps saw a median increase of only thirty-five percent. Something is driving premiums higher, it just isn’t necessarily malpractice claims. A more recent study from New York shows exactly the same thing.

The other primary method of studying “defensive medicine” is simply to send surveys out to various doctors and simply ask them if they practice medicine defensively. This is the preferred method of researchers on almost every side of every question. This is so because the researcher can, by carefully crafting survey questions, get any answers he or she desires. And, in the major survey of this topic, we find that is exactly what surveyors did.

An early attempt to discover whether doctors practice defensive medicine was conducted in the early 1990s by the Office of Technology Assessment (OTA), a non-partisan research arm of the U.S. Congress. This agency concluded that defensive medicine is real, and may cause as much as eight percent of the cost of health care. However, a 2003 audit of this survey by another non-partisan research arm of Congress, the General Accounting Office, found the OTA research unconvincing, because: “Physician clinical scenario surveys were designed to elicit defensive medicine practices among physicians; hence they may overestimate the rate at which defensive medicine is practiced.” (Appendix III, Table 5).

The GAO found similar flaws with studies from the American Medical Association (AMA) and the American Academy of Orthopaedic Surgeons which had purported to show high levels of defensive medicine. The GAO found that those studies’ “Low response rates and imprecise measurements of defensive medicine practices preclude generalizing these responses to all physicians.” (page 31/63 in pdf).

So, do any physicians ever practice “defensive medicine” because of tort liability? Sure, probably some do. But is it a major factor driving the increase in health care costs? The evidence for that question is thin, and so far at least, based mostly on faulty research.

The tort system exists for several reasons, primary among them, to make victims whole and deter doctors from misconduct. We have made radical changes to this system in the past and surely we will again. And yet, before we conduct major surgery on our legal system, shouldn’t we make sure our diagnosis of the problem is correct?

Why don't we try to reduce acts of medical malpractice first...