The Bloviator has a lengthy post linking to and discussing recent scholarship on the cause of the malpractice insurance "crisis." [To paraphrase Tommy Lee Jones in Men in Black "there's always a crisis."] Bloviator summarizes that malpractice rates are driven by changes in interest rates, that controlling payouts in malpractice cases by "caps" on malpractice awards does provide a "short term" effect on reducing malpractice premiums, and that doctors over-estimate their exposure to malpractice awards.

This post is the first time that I have seen an acknowledgment that malpractice premium increases result from insurance companies' investment decisions. Although it is politically correct to blame malpractice lawsuits for this "crisis," the fact is that juries are biased in favor of medical practitioners more than any other group in society. If a doctor gets tagged for malpractice, then he or she has done something fairly egregious.

Caps in damage awards may have a short term effect in fighting malpractice insurance rate increases, but they may have long term effects on the victims of medical malpractice. I don't have the citation for this story - I read it in the San Francisco Daily Journal about ten years ago. The opinion piece was by a lobbyist who had represented the medical lobby in enacting malpractice caps in a state in the Mid-west. As fate would have it, the author underwent surgery and had his spinal cord knicked, leaving him in intense pain. Unable to work, his life unravelled. His wife divorced him, he filed bankruptcy, and lost everything except his exempt assets, and he was left to sit in constant pain, reflecting on his good work in limiting medical malpractice damages.