Can damage caps influence premium growth and physician supply?
Posted by Clark Venable on 1/21/2006
The Impact of Caps on Damages: How are Markets for Medical Liability Insurance and Medical Services Affected?
"[This report] provides a summary of research on the impact of caps including those on punitive and total damages in addition to those that apply only to non-economic damages. Our focus is on those papers that employ statistical techniques to control for potentially competing explanations of changes that are observed when simple descriptive statistics are used."
and concludes
"the body of research on the impacts of tort reform shows that caps have resulted in lower growth in medical liability losses in states that passed caps than in states that did not. The more recent literature on premium effects has found that caps result in lower premium growth. And, two very recent papers based on sufficiently many years of the AMAâs Masterfile data have found that non-economic caps and direct tort reforms more generally have a positive effect on the number of physicians per capita in a state."
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