Robert Wood Johnson Foundation Issues Report on Malpractice Premiums

Courtesy of Walter Olson, we learn of a January 2006 report from the Robert Wood Johnson Foundation entitled "Understanding medical malpractice insurance: A primer." Authored by Michelle M. Mello, J.D., Ph.D., of the Harvard School of Public Health, the report assesses the relationships between medical malpractice premiums, claims payments, and other factors.

The report is sure to annoy rabid ideologues of every stripe. That is to say, its conclusions seem pretty reasonable, on the whole. The report notes that partisans on both sides of the controversy over malpractice insurance rates often stress their own pet explanations to the exclusion of others. Physicians and proponents of "tort reform" emphasize claims costs. Lawyers and consumer groups point to the recent fate of insurance company investments and other structural industry factors. The truth, according to the report, is probably that both sets of causal factors are in play to some degree. Rising claims costs (driven by an increase in average payouts, not claim frequency) "have contributed to rising premiums," says the report, "but do not explain the sudden spike in premiums around 1999-2000."