Medical liability environment in the United States: Geographic variations and changes over time

Background: Rising medical liability risk among health care providers has been a great concern in the health care industry and health policy arena. Objectives: This study sought to characterize geographic variation in the malpractice liability environment in the United States and changes in the environment during the period of 1996-2007. Methods: Data for this study came from a number of sources: the 1996-2007 Medical Liability Monitor's annual premium rate survey, National Association of Insurance Commissioners' premiums and losses data for medical malpractice insurance companies, National Practitioner Data Bank public use data file, and the Area Resource File. We estimated state-year specific measures on the average malpractice insurance premiums (weighted by the medical malpractice insurance company's market share and distribution of physicians across counties), severity of paid medical malpractice claims (measured by median payment in inflation-adjusted 2007 U.S. dollars), and frequency of paid medical malpractice claims (measured by the number of paid medical malpractice claims per 1,000 physicians). Results: Nationwide the frequency of paid medical malpractice claims decreased from 21.1 per 1,000 physicians in 1996 to 12.5 per 1,000 physicians in 2007, while the median payment for medical malpractice claims increased from $128,819 to $195,000 over the same period. The median medical malpractice payment ranged from $7,949 per paid claim in West Virginia in 1998 to $435,000 per paid claim in Illinois in 2007. The frequency of paid medical malpractice claims in a state in a year ranged from 1.9 paid claims per 1,000 physicians in Vermont in 2007 to 30.3 paid claims per 1,000 physicians in Indiana in 1996. In addition, there is substantial geographic variation in malpractice insurance premiums. In 2007, the premium ranged from $4,537 (internal medicine), $13,727 (general surgery), and $21,018 (obstetrics/gynecology) in Minnesota to $41,507 (internal medicine), $158,747 (general surgery), and $173,571 (obstetrics/gynecology) in Florida. Conclusion: There is marked geographic variation in medical liability environment in the United States and substantial changes in the environment over time. Such variations could have important implications for the distribution and clinical practice of health care providers.