Impact of State Tort Reforms on Utilization - PowerPoint PPT Presentation

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Impact of State Tort Reforms on Utilization

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  1. Impact of State Tort Reforms on Utilization Jackson Williams

  2. Tort Reform • In early part of past decade, prices of medical liability insurance spiked. • AMA declared that certain states were experiencing “crises” where patients were losing access to doctors. • Doctors’ lobbying campaigns for tort reforms were bolstered by promises of cost savings from reductions in “defensive medicine.” • Ten states capped damages between 2002-2005.

  3. Putative Benefits of Tort Reform • Increased Access • As doctors get to keep more money, they will work harder, invest in their practices • Prediction: More doctors, working more hours • Decreased Defensive Medicine • With less overall liability exposure, doctors should have less fear of lawsuits over missed diagnosis • Prediction: Decreased utilization for testing

  4. A Simple View of Tort Reform’s Predicted Effects

  5. What Are the Dependent Variables? • Investigators studying the Access Thesis have usually used number of doctors per state. • Investigators studying the Defensive Medicine Thesis have usually used utilization data. • However, as GAO noted, utilization is also expected to be higher as access increases. • In other words, Access Thesis implies higher utilization even as Defensive Medicine Thesis predicts lower utilization.

  6. Graphing Defensive Medicine:Assume No Payment Incentives

  7. Graphing Defensive Medicine:Assume No Payment Incentives

  8. Graphing Defensive Medicine:Payment Incentivizes Stinting

  9. Difference-in-Differences AnalysisGrowth in Diagnostic, Lab & X-Ray 2000-2007

  10. Difference-in-Differences AnalysisGrowth in Diagnostic, Lab & X-Ray 2000-2007

  11. Eisenberg: Physician’s Three Main Motivations • The physician as the patient’s agent: Physician performs clinical services in the interest of, or demanded by, the patient. • The physician as guarantor of social good: Physician strives for efficiency and protection of the public. • The physician as self-interested practitioner: Physician seeks target income, pursues practice style convenient to him/her.

  12. More Realistic View of Volume and Intensity in Past Decade?

  13. Questions Raised By Findings • Why haven’t policymakers and researchers more fully thought through (or articulated) these contradictions? • Was there endogeneity involved in Tort Reform States’ growth? • If there is true defensive medicine affecting utilization, what is the correct policy response?