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• W2019166301 abstract "The Swedish compensation system for medical injuries has been suggested as a possible model for medical malpractice reform in the United States and in other countries.2 Patient compensation in Sweden is provided by the Patient Compensation Insurance (PCI), a voluntary, contractual administrative mechanism that provides compensation without proof of provider fault. The discipline of medical providers is handled by a separate Medical Responsibility Board (MRB). The frequency of claims filed per physician is at least 50% higher under the PC1 than under the U.S. medical malpractice system, but the PC1 is widely accepted by the medical profession. The PC1 costs roughly $2.38 per capita, or 0.16% of health care costs in Sweden, whereas U.S. medical malpractice insurance premiums account for l-2% of (higher) health care expenditures, more than a lo-fold difference. Administrative overhead is 18% of total PC1 premiums, compared to roughly 60% in the United States. Recent proposals in the United States for a rule of no-fault (strict) enterprise liability for medical injuries cite the PCI’s low overhead rate as evidence of the potential savings from switching from a negligence rule to a causation-based rule of liability.” In this regard, the PC1 has also been compared to strict enterprise liability under workers’ compensation, which also has a lower overhead percentage than tort liability.4 The purposes of this paper are three. First, it provides a brief description of the structure and experience of the PC1 and the MRB. Second, it explains the PCI’s low overhead, using a simple model of optimal litigation effort. This model challenges the conventional wisdom that the PCI’s low overhead derives from a no-fault rule of liability. More generally, any analogy between no-fault as applied in the PC1 and nofault systems of strict liability-either workers’ compensation or strict enterprise liability for medical injuries-is misplaced. On the contrary, the PC1 experience illustrates that a causation-only test for compensability is neither necessary nor sufftcient for low overhead costs. Rather, the PC1 achieves low overhead costs by foregoing any attempt at deterrence. The MRB, which is totally decoupled from the PCI, is ineffectual. In general, low overhead is a very misleading indicator of the efficiency of any insurance system. A third purpose of this paper is to examine lessons from the PC1 for a proposed contractual alternative for medical injuries. 5 The fact that patients and providers overwhelmingly opt into the PC1 rather than tort suggests that it offers a Paretosuperior alternative. However, contractual options are constrained by transactions" @default.
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• W2019166301 date "1994-12-01" @default.
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• W2019166301 title "The Swedish patient compensation system: Myths and realities" @default.
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• W2019166301 doi "https://doi.org/10.1016/0144-8188(94)90026-4" @default.
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