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How Damages Caps Are Ruining Health Care


It’s ironic that laws put in place to save healthcare are slowly destroying it. Damages caps are laws limiting the amount of monetary compensation an injured individual can receive from a personal injury or medical malpractice case. The caps are meant to save health care providers from drowning in unreasonably high insurance premiums. However, recent studies conducted by Northwestern University and the University of Illinois have revealed that damages caps are indisputably doing more harm than good for health care. Researchers found that damages caps lead to more medical errors, higher health care costs, and no increase in patient care physicians.

More Medical Errors

Damages caps limit the amount health care providers have to pay out for injuries and accidents. Naturally the logic follows that if you limit the consequences of making mistakes, more mistakes will occur. By examining several key indicators across states that recently enacted damages caps, researches were able to conclude that enacting damages caps led to a direct spike in medical errors. In fact, the data revealed that operating room injuries increased by an average of 21.2%, birth related injuries increased by 14.6%, and patient safety indicator risk factors typically increased by 12.7%.

Higher Health Care Costs

With physicians theoretically paying less in medical malpractice insurance you’d expect health care costs to decrease, but such is not the case. In states that enact damages caps the average rise in Medicare Part A is 6%. Medicare Part B tends to rise by over 50%.

No Physician Increase

According to the Association of American Medical Colleges, the US is currently facing a shortage of physicians that is expected to drastically increase. By the year 2025 it’s estimated the US will be short somewhere between 61,700 and 94,700 physicians. With health care provider medical malpractice insurance decreasing from a reduction in injury compensation hospitals should be able to afford staffing more physicians. However, states that enact damage caps actually show a decrease in the number of physicians on staff. States with damages caps see an average decrease of 2.4% in the number of practicing physicians.

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