TY  - JOUR
AU  - Kessler,Daniel P.
AU  - McClellan,Mark B.
TI  - How Liability Law Affects Medical Productivity
JF  - National Bureau of Economic Research Working Paper Series
VL  - No. 7533
PY  - 2000
Y2  - February 2000
UR  - http://www.nber.org/papers/w7533
L1  - http://www.nber.org/papers/w7533.pdf
N1  - Author contact info:
Daniel Kessler
Hoover Institution
Stanford University
434 Galvez Mall
Stanford, CA  94305
Tel: 650/723-0596
E-Mail: fkessler@stanford.edu

Mark B. McClellan
Director, Engelberg Center for Health Care Reform
Senior Fellow, Economic Studies
Leonard .D. Schaeffer Director's Chair in
Health Policy ,The Brookings Institution
1775 Massachusetts avenue, N.W.
Washington, DC 20036
Tel: (202) 741-6567
Fax: NA
E-Mail: mmcclellan@brookings.edu
AB  - Previous research suggests that "direct" reforms to the liability system -- reforms designed to reduce the level of compensation to potential claimants -- reduce medical expenditures without important consequences for patient health outcomes.  We extend this research by identifying the mechanisms through which reforms affect the behavior of health care providers.  Although we find that direct reforms improve medical productivity primarily by reducing malpractice claims rates and compensation conditional on a claim, our results suggest that other policies that reduce the time spent and the amount of conflict involved in defending against a claim can also reduce defensive practices substantially.   In addition, we find that "malpractice pressure" has a larger impact on diagnostic rather than therapeutic treatment decisions.  Our results provide an empirical foundation for simulating the effects of untried malpractice reforms on health care costs and outcomes, based on their predicted effects on the malpractice pressure facing medical providers.
ER  -