Medical Malpractice Claims Frequency Declining, Severity Stabilizing

Health care organizations’ medical malpractice claim frequency appears to be declining slightly and severity is leveling off, according to a new report released today.

Data collected from 1,600 hospitals in report years 1997 through 2007 reveals that the most severe claims, those higher than $1 million, have stabilized, says Zurich North America.

The fifth annual Zurich benchmarking report on claims trends in the health care industry shows that claims severity, or the average amount per claim, has stabilized over the past several years. The average annual rise over the past 11 years is just 4 percent.

The report also found that teaching and children’s hospitals have higher claim severity than acute care community hospitals and outpatient facilities. Non-profit hospitals have the lowest severity; and among non-profits, faith-based institutions have the lowest severity of all.

“It’s interesting to note that severity does continue to rise among claims valued under $1 million, which are the claims considered more typical within an institution’s loss experience,” said Leo Carroll, head of Healthcare-Specialty Products, Zurich North America Commercial. “While the most severe claims (those valued above $1 million and $5 million) have stabilized overall, the frequency of those large losses has increased slightly.”

Carroll also noted that the most severity prone states continue to be New York, Illinois, and Pennsylvania.

“We’re continuing to monitor the impact to claim activity by changes in tort reform, patient safety initiatives, and use of technology to improve quality of care,” he said.

Source: Zurich