Medical malpractice insurance is a financial drain on many physicians and other medical personnel and medical institutions, and this is a problem that has only increased in our litigious society. The problem occurs in other countries as well, though to a greater or lesser degree depending in part on the underlying attitude toward legal issues and lawsuits. The attempt to control malpractice suits and to prevent any problem from occurring that might lead to a lawsuit is known as defensive medicine, and defensive medicine cost nearly $10 billion per year, adding to the already high cost of medicine in America. Among the causes of this high cost are malpractice insurance, unnecessary tests and procedures, and other such measures (McCormick, 1993, 4).
A variety of new studies have shown that the elimination of defensive medicine would be a major cost saving for the health industry and for the consumer. Brostoff (1993) reports on a study by Lewin-VHI for MMI companies and suggests that physician liability insulation should be part of health care reform and that it could save the system some $36 billion over a five-year period. The change called for would be policy changes in tort reforms and new rules to protect physicians from liability. The report claims that the defensive mechanisms undertaken by physicians to insulate themselves from liability are of no benefit to the patient. The report does note that the costs of defensive medicine vary widely because there is little agreement as to how to define the issues. The Congressional Budget Office recently stated that defensive medicine is probably not a major factor in the cost of medical care. On the other hand, the Bush administration estimated in 1991 that defensive medicine costs $20.7 billion a year. The American College of Surgeons reported in 1984 that the costs stood at $52 billion.
The Lewin-VHI report points to specific procedures and their high cost. The report c...