Clinical Orthopaedics and Related Research
Volume 47, Number 2 / February, 2009;
Pages 420-426
By: Jeffrey Segal, MD, JD, FACS and Michael Sacopulos, JD

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Medical professional liability in the United States, as measured by total premiums paid by physicians and healthcare facilities, costs approximately $30 billion a year in direct expenses, less than 2% of the entire annual healthcare expenditures. Only a fraction of those dollars reach patients who are negligently injured. Nonetheless, the tort system has far-reaching effects that create substantial indirect costs. Medical malpractice litigation is pervasive and physicians practice defensively to avoid being named in a suit. Those extra expenditures provide little value to patients. Despite an elaborate existing tort system, patient safety remains a vexing problem. Many injured patients are denied access to timely, reasonable remedies. We propose a no-fault system supplemented by a variation of the traditional tort system whereby physicians are incentivized to follow evidence-based guidelines. The proposed system would guarantee a substantial decrease in, but not elimination of, litigation. The system would lower professional liability premiums. Injured patients would ordinarily be compensated with no-fault disability and life insurance proceeds. To the extent individual physicians pose a recurrent danger, their care would be reviewed on an administrative level. Savings would be invested in health information technology and purchase of insurance coverage for the uninsured. We propose a financial model based on publicly accessible sources.