Do Doctors Practice Defensive Medicine?

49 Pages Posted: 11 Aug 2000 Last revised: 10 Dec 2022

See all articles by Daniel P. Kessler

Daniel P. Kessler

Stanford Graduate School of Business; National Bureau of Economic Research (NBER)

Mark B. McClellan

Brookings Institution; Council of Economic Advisors; National Bureau of Economic Research (NBER)

Multiple version iconThere are 2 versions of this paper

Date Written: February 1996

Abstract

`Defensive medicine' is a potentially serious social problem: if fear of liability drives health care providers to administer treatments that do not have worthwhile medical benefits, then the current liability system may generate inefficiencies many times greater than the costs of compensating malpractice claimants. To obtain direct empirical evidence on this question, we analyze the effects of malpractice liability reforms using data on all elderly Medicare beneficiaries treated for serious heart disease in 1984, 1987, and 1990. We find that malpractice reforms that directly reduce provider liability pressure lead to reductions of 5 to 9 percent in medical expenditures without substantial effects on mortality or medical complications. We conclude that liability reforms can reduce defensive medical practices.

Suggested Citation

Kessler, Daniel Philip and McClellan, Mark B., Do Doctors Practice Defensive Medicine? (February 1996). NBER Working Paper No. w5466, Available at SSRN: https://ssrn.com/abstract=225513

Daniel Philip Kessler (Contact Author)

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Mark B. McClellan

Brookings Institution ( email )

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