Tort Reform--Posner's Reply to Comments

As usual, there were many excellent comments. Let me respond to some: Several comments point out correctly that the determination of medical malpractice (that is, medical negligence) by the courts is very often inaccurate; there are many false positives and false negatives. To that problem, capping damages judgments is no solution. An attractive solution is testimony by a neutral expert witness. The fact that judges may have difficulty determining who is neutral is no objection; the judge can ask the parties' medical experts to jointly nominate a third; he would be the neutral and the judge and jury would appropriately rely heavily on his testimony. The procedure I am suggesting is similar to a widely used procedure for picking a neutral arbitrator: each party designates one arbitrator, the two arbitrators choose the third, who is neutral, and he then provides the deciding vote. An alternative, mentioned in one comment and already in force in a number of states, is to require the malpractice plaintiff before suing to submit his claim to a panel of physicians, whose findings, if unanimous, are admissible in court should the claim result in a lawsuit. One comment pointed out that medical errors are often systemic, i.e., they result from erroneous procedures or practices by hospitals, drug companies, and other institutions rather than from mistakes by individual physicians. However, those entities are suable. It was also noted that heavy insurance premiums might drive some physicians from practice and deter some people from becoming physicians in the first place. That is true, but if the result is less medical negligence, the benefits might exceed the costs. In addition, the overall effect on medical expenses is likely to be slight, because physicians' fees are only a moderate component of overall medical expenses. Furthermore, if physicians are driven out by high premiums, the resulting reduction in the supply of physicians should enable those who remain to raise their fees. A slightly esoteric point: one comment suggested that pain and suffering, disfigurement, and other nonpecuniary losses imposed by medical errors are not real costs because people rarely try to buy insurance against such losses. However, the reason they do not buy insurance is not that the losses aren't real, but that insurance is designed primarily for replacing income or defraying an expense. I also disagree that negotiation of the level of medical care should be left to physician and patient, because they have a preexisting contractual relationship. The principle is fine (though it would require a chance in existing law), but the transaction costs would be prohibitive because of the patient's ignorance of particular procedures, risks, and so forth. In addition, a physician who told his patient that he would operate on him only if he waived his right to sue for medical malpractice would be signaling the likelihood of an unfavorable outcome. Hence physicians would be reluctant to suggest such waivers. I was pleased to learn from two of the comments that some insurance conmpanies do experience-rate medical malpractice insurance. Why others do not is a mystery, but it occurs to me that one possibility is that the inaccuracy of judicial determinations of malpractice is so great that being sued and losing a malpractice case does not provide useful information about the likelihood of being sued in the future. On this view, malpractice liability is random. One hopes not; but if so, reforms, such as those suggested above, aimed at increasing the accuracy of malpractice determinations are urgently needed.

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