Medical Malpractice:

Insurance Costs Increased but Varied Among Physicians and Hospitals

HRD-86-112: Published: Sep 15, 1986. Publicly Released: Sep 22, 1986.

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In response to congressional requests, GAO reviewed the medical malpractice situation in the United States, including the costs of malpractice insurance for physicians and hospitals.

GAO found that: (1) total malpractice insurance costs for physicians increased from $1.7 billion in 1983 to $3.4 billion in 1985; (2) the costs varied widely by specialty, by state, and within some states; (3) as a percentage of total professional expenses, the costs averaged 7 and 9 percent for all self-employed physicians in 1982 and 1984; (4) the costs increased at a greater rate than did other expense items from 1982 to 1984; and (5) the highest premiums for medical malpractice insurance for physicians were primarily concentrated in high-risk specialties and in Florida, Illinois, Michigan, New York, and the District of Columbia. GAO also found that: (1) total malpractice insurance costs for hospitals increased from $800 million in 1983 to $1.3 billion in 1985; (2) the costs varied by location and hospital size and increased more than total expenses; (3) about 1,920 hospitals increased their coverage limits; and (4) average inpatient-day cost attributable to malpractice insurance was about 1 percent of the average inpatient-day expense for hospitals in 1983 and 1985.

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