April 11, 2006

HealthGrades has released a report (via Day) on relative safety of hospitals across America, with a ranking of each of the fifty states and District of Columbia. I asked AEI research assistant Phil Wallach to cross-reference HealthGrades' grades against whether the states had caps. Recall that reform opponents argue that caps reduce the quality of care because doctors no longer fear malpractice awards. Reformers argue that malpractice litigation is so random that it deters the practice of medicine without any real effect on quality of care, because good doctors are almost as likely as bad doctors to be sued. The HealthGrades survey of quality should be especially useful for adjudging the effect of noneconomic damages caps, because it focuses on Medicare patients: precisely the class of potential plaintiffs who have low economic damages and therefore rely on noneconomic damages to make a suit worthwhile. What are the results?

Can you detect the trend? If anything, states with caps are more likely to be above average. (The difference isn't statistically significant.) Of course, there are other variables to be considered; this is the simplest of statistical analyses. But if the effect of damages caps were so drastic on patient care, one wouldn't expect to see caps in some of the best performing states. It seems that caps affect attorneys and doctors, but not patients. Posted by Ted Frank at 11:40 AM | TrackBack (0)