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A shocking concession by Svorny on medical malpractice caps

I'd encourage everyone who hasn't done so to read in full my exchange with Cato adjunct scholar Shirley Svorny discussing her recent policy analysis, Could Mandatory Caps on Medical Malpractice Damages Harm Consumers?

In her final comment, Svorny says "[w]hether the costs of the [medical-malpractice tort] system are greater than the benefits is not something we have a handle on." But that is the wrong question, since no one is feasibly advocating eliminating medical malpractice liability altogether: the policy question, as any economist should know, is whether the marginal costs of the system exceed the benefits. If so, then reforms at the margin that reduce liability will have benefits exceeding the costs. As I explained in my contributions to the debate, I believe that such marginal cost-benefit improvements do in fact flow from medical malpractice caps for noneconomic damages: such caps reduce inaccuracy of the system, reduce the incentive to bring low-merit cases, and send a better signal to doctors about the relative likelihood of being sued for malpractice versus being sued for malpractice wrongfully. (Thus, Svorny misstates my position when she says "Frank is convinced that the costs of the current system outweigh the benefits"; I am only claiming that this is the case at the margin.)

But Svorny's concession that she doesn't know even as an absolute matter whether the benefits of liability in toto exceed the costs is really extraordinary. In this debate, she says she cannot opine whether we would be better off if we abolished malpractice liability altogether. But abolishing medical malpractice altogether is a cap of zero, a far more radical cap than the one she condemns in her paper and in the Huffington Post, where she made widely-repeated claims that non-economic damage caps for medical malpractice cases were a bad idea. In this exchange, she has effectively acknowledged she has no basis for that unequivocal policy prescription that has headlined the discussion of her paper. I hope Cato prints a retraction, given that without it, that paper's non sequitur conclusion is destined to be misused to distort the debate for years to come.

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Rafael Mangual
Project Manager,
Legal Policy

Manhattan Institute


Published by the Manhattan Institute

The Manhattan Insitute's Center for Legal Policy.