Frequency and severity in medmal claims

New England Journal of Medicine got all actuarial this week with an article about frequency and severity of medical malpractice claims. (This link takes you to the online article. This one downloads the pdf.)

The researchers obtained an insurance company data of 41,000 physicians and 234,000 physician-years of coverage from 1991 to 2005 and the claims record against each physician, including both claims that settled with an indemnity payment and those that did not. (All of the dollar payments were normed to 2008 dollars.)


  • A big range in annual frequency, evidenced by the first skinny chart. The highest approach 20%, mainly surgeons. Lowest were family medicine (5.2%), pediatrics (3.1%) and psychiatry (2.6%).
  • That was frequency of claims. But the vast majority of claims settle with no indemnity payment. Overall frequency was 7.4%, but claims with indemnity payment was only 1.6%.
  • Severity also varied a lot. The mean indemnity payment was about $275K, with dermatology lowest ($118K) and pediatrics highest ($521K). The median was considerably lower for all specialties,  $274,887, which you’d expect given the heavy right skew of medmal claims. The second skinny chart ranks specialties by median award, but also shows the mean award.
  • Virtually all physicians in high-risk specialties will be hit by a claim (99%), which doesn’t surprise me. More surprising, 75% of physicians in low-risk specialties will also get hit sometime in their careers.

Most interesting to me, though, is the author’s conclusions of how the threat of medical malpractice claims – even no-pays – causes the practice of defensive medicine:

Physicians can insure against indemnity payments through malpractice insurance, but they cannot insure against the indirect costs of litigation, such as time, stress, added work, and reputational damage.


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