Average Medical Malpractice Claims Payment

Total Dollars in Paid Medical Malpractice Claims

According to figures tallied from 1991 to 2003 by the Physician Insurers Association of America, and the National Practitioner Data Bank, payments on medical malpractice claims have taken a noticeable upturn. The PIAA recorded a rise from $1.93 million in 1994 to $3.73 million in 2002 and the NPDB documented $2.12 million in 1991 and $4.45 million in 2003. Although one source has estimated somewhat lower than the other, they both depict a trend of growth for the total amount of medical malpractice claims being paid.

Number of Paid Medical Malpractice Claims

The quantity of paid medical malpractice claims recorded in this same time period by the two sources mentioned above did not experience as much of an increase as the total dollar amount paid. The NPDB estimated there to be 13,687 paid claims in 1991 and 15,287 in 2003, indicating a rise of 12%, whereas, PIAA had 10,882 in 1994 and 11,590 in 2002, showing a more moderate rise of only 7%.

Average Medical Malpractice Claims Payments

Taking the amount of the total dollars in paid medical malpractice claims that were paid and dividing it by the number of paid medical malpractice claims in the corresponding years and you will get the average medical malpractice claims payments. The NPDB estimate for 1991-2003 rose from $154.7 thousand to $291.2 thousand (88%) and the PIAA increased from $139.9 thousand in 1988 to $322.0 thousand in 2002 (131%.)

Average Defense Costs per Medical Malpractice Claim

Even if a medical malpractice claim against a medical provider is not decided in the plaintiff’s favor, there are still significant “defense costs” that the malpractice insurer or defendant are responsible for. There are the costs of hiring expert witnesses, legal fees and other handling fees. According to PIAA figures gathered from 1991 through 2001, the average defense costs per “paid” claims grew from $21,000 to $43,000; the average defense costs per “all” claims grew from $15,000 to $29,500; and the average defense costs per “no payment” claims grew from $12,000 to $23,500. The claims that did not pay out made up 61% of all medical malpractice claims in this time period.

average medical malpractice defense costs per claim

Variation of Average Medical Malpractice Claim Payments across the States

From the figures illustrated in this article, we can see that rising medical malpractice costs are an obvious trend in this country. But, if we looked closely at individual states we would see a different story for some of them. NPDB information, from 1991-2003, indicates that even though the average medical malpractice claim payment for the U.S. was $276,235, it was as little as $121,313 in Michigan and as much as $483,319 in Connecticut.

Growth rates of medical malpractice costs may vary greatly from state to state. California, Florida, Illinois, New Jersey and Texas have all experienced high costs between 1999 and 2003 but they each came to that conclusion in a different way. Florida had an increase of 66% in this time frame but was fairly constant in the early 2000s. New Jersey had a rise of 47% but was riding a roller coaster from year to year. And California’s increase was at 11%, staying pretty stable the whole time.

total medical malpractice payments for high expenditure states

While other states experienced increases in payments such as Indiana and South Carolina, other states saw declines in their total payments –Kansas and New Mexico. The graph below focuses on the experience of several low expenditure states (South Carolina, New Mexico, Indiana, and Kansas).

total medical malpractice payments for low expenditure states

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