The Ecology of Defensive Medicine and Malpractice Litigation

RESEARCH ARTICLE The Ecology of Defensive Medicine and Malpractice Litigation Angelo Antoci☯, Alessandro Fiori Maccioni*☯, Paolo Russu☯ Department of Economics and Management, University of Sassari, Sassari, Italy ☯ These authors contributed equally to this work. * Abstract OPEN ACCESS Citation: Antoci A, Fiori Maccioni A, Russu P (2016) The Ecology of Defensive Medicine and Malpractice Litigation. PLoS ONE 11(3): e0150523. doi:10.1371/ journal.pone.0150523 Editor: Pablo Brañas-Garza, Middlesex University London, UNITED KINGDOM Using an evolutionary game, we show that patients and physicians can interact with predator-prey relationships. Litigious patients who seek compensation are the ‘predators’ and physicians are their ‘prey’. Physicians can adapt to the risk of being sued by performing defensive medicine. We find that improvements in clinical safety can increase the share of litigious patients and leave unchanged the share of physicians who perform defensive medicine. This paradoxical result is consistent with increasing trends in malpractice claims in spite of safety improvements, observed for example in empirical studies on anesthesiologists. Perfect cooperation with neither defensive nor litigious behaviors can be the Paretooptimal solution when it is not a Nash equilibrium, so maximizing social welfare may require government intervention. Received: July 2, 2015 Accepted: February 15, 2016 Published: March 16, 2016 Introduction Copyright: © 2016 Antoci et al. This is an open access article distributed under the terms of the Creative Commons Attribution License, which permits unrestricted use, distribution, and reproduction in any medium, provided the original author and source are credited. Medical malpractice litigation may be as old as medicine itself. However, it only became the focus of economic research in the early 1970s, when the cost of malpractice insurance reached record highs because of commensurate increases in lawsuits. Defensive medicine is the practice performed by health care providers to safeguard themselves from patients' claims, while disregarding improvements in patients' health [1,2]. Through defensive medicine, physicians can discourage patients from suing and minimize their chance of being held liable in the event of lawsuits. It can take the form of avoidance behavior and is called negative defensive medicine when the physician refuses to perform high risk procedures. It can also take the form of assurance behavior and is called positive defensive medicine when it is performed using extra tests or procedures. Positive defensive medicine, which we study in this paper, leads to unnecessary diagnostic and therapeutic interventions, which may be invasive and costly. Theoretical research often considers the inefficient provision of medical services as a principal-agent problem and describes its market failures as being due to asymmetric information, moral hazard and conflicts of interest [3–7]. The literature generally agrees that physicians’ behavior does not perfectly fit the neoclassical theory of firms, because of the following aspects [8]. Physicians tend to maximize their profits, but they may also give up some income to promote patients' welfare. Such conduct is consistent with the income/leisure tradeoff that determines supply in Data Availability Statement: All relevant data are within the paper and its Supporting Information files. Funding: The research of A. Antoci and P. Russu was financed by Regione Autonoma della Sardegna (L.R. 7/2007) under the project ‘Capitale sociale e divari economici regionali’. The research of A. Fiori Maccioni was financed by P.O.R. FSE Sardegna 2007/13 under the project ‘Risk Management System per aziende sanitarie’, held at the University of Sassari with the logistical support of Prossima Isola. The authors declare that the funding sources had no involvment in the research and have no conflicts of interest. PLOS ONE | DOI:10.1371/journal.pone.0150523 March 16, 2016 1 / 15 The Ecology of Defensive Medicine and Malpractice Litigation Competing Interests: The authors have declared that no competing interests exist. labor microeconomics and with altruistic behavior observed in economic experiments [9–11], even in extreme forms [12,13]. Physicians can set the quantity of medical treatment, which is not directly contractible, in partial response to self-interest and subject to demand constraints proportional to the benefit of patients. Physicians can encourage unnecessary health care by increasing their observable effort when treating insured patients [14], or by increasing their unobservable effort and observable care to prevent patients from switching to a competitor in case of adverse events [15]. This latter over-treatment can be considered a contingent form of positive defensive medicine. Superfluous but profitable therapies are more likely when physicians are less fearful of liability [16]. As regards negative defensive medicine, maximizing profits can also induce physicians to under-provide services to the high severity patient if they face liability [17–20]. Physicians can also perform defensive medicine because of fear of reputational losses [21,22]. Stricter negligence standards can lead to more defensive but less negligent medicine, which may increase social welfare [23], although this possibility is controversial [24]. Defensive medical practices are widespread, particularly in specialties at high risk of litigation, such as surgery, obstetrics and gynecology [25–28]. Throughout their career, U.S. surgeons will almost certainly face a malpractice claim, while there is a 70% probability of their facing an indemnity payment [28]. The liability system influences defensive medical practices [2,16] and the costs of medical malpractice insurance [29], but the impact of legal reforms is still disputed [30–32]. Assessing the economic impact of the medical liability system (including defensive medicine) is notoriously difficult because of the lack of reliable evidence and, therefore, its cost estimates vary widely, from 2% to 10% of health care spending in the U.S. [33,34]. The frequency of malpractice claims increased at nearly 10% a year in the 1970s and 1980s [35,36]; since then, it has been moderately stable [28,37]. The factors that explain this increase in claims are not yet fully understood [36]. Empirical data suggest a paradoxical positive relationship between clinical safety and litigation rates. Anesthesiology provides a clear example. In the mid-1980s, this specialty achieved impressive improvements in safety through technological advances and the diffusion of monitoring standards [38,39]. However, empirical studies reveal an increase between 1980 and 1997 in malpractice claims against U.S. and Canadian anesthesiologists [40,41]. In that period, despite a nearly tenfold decrease in the anesthesia mortality rate [38,39], the claims for anesthesia-related death in the U.S. had ba (...truncated)