Med mal costs set to increase

In recent years, medical malpractice caps have kept claim costs down, but that may be ending, according to two reports out last week.

First, Aon’s 11th annual Hospital Professional Liability and Physician Liability Benchmark Analysis predicts 5% trend in claims per hospital bed next year, with frequency rising 1% and severity rising 4%.

Also, hospital obstetrics claims are projected at $204 per birth, and claims stemming from ER visits will hit $6.30 per visit. (To the casual visitor: These are not costs per claim, but total costs spread across all births or visits, regardless of whether the visit results in a claim.)

And since hospitals are hiring more physicians, they can expect a shift of claims from physician professional liability to hospital physician liability. Hospital hiring of physicians grew 12% a year between 2005 and 2009.

Update: WSJ blogs about Aon report here.

The second report, from the Medical Liability Monitor, shows the same trends for internist/general surgeon/obgyn rates – declining costs over the past few years – see chart – but upticks in frequency in some markets, which is likely to portend higher rates. (WebMD’s Medscape Today has the story.)


Party's ending.


Milliman actuary Chad Karls predicts that Obamacare could cause a spike in claims. As more people get insurance, the health care system will be strained, leading to more errors, hence more lawsuits. Most insurers disagree; only 31% forecast an increase in frequency or severity from health care reform.

Of course, the system will really feel the strain in 2014, when Obamacare really kicks in. Few insurers project rates that far ahead.

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2 thoughts on “Med mal costs set to increase

  1. […] the estimate coming out of Aon’s annual medical malpractice study. I blogged about the study here, but National Underwriter picked up this tidbit: Though claims against hospitals declined for a […]

  2. SharonRN says:

    Timely and poses interesting statistics for upcoming legislative tort reform debates.

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