Curing is caring? Liability reforms, defensive medicine and malpractice litigation in a post-pandemic world

doi:10.1016/j.seps.2021.101164

Socio-Economic Planning Sciences

Volume 80, March 2022, 101164

https://doi.org/10.1016/j.seps.2021.101164 Get rights and content

Highlights

•: We study a simple game-theoretic model of physician-patient therapeutic interaction.
•: We characterize conditions under which defensive medicine practices arise.
•: We identify four main regimes related to defensive medicine practices.
•: We analyze the impact of liability reforms on defensive medicine practices.
•: There is no kind of reform that may unambiguously deter defensive medicine practices.

Abstract

We analyze different scenarios of defensive medicine in a unique game theoretic framework, representing a healing relationship between a physician and a patient. The physician should choose between providing the optimal treatment or an inferior one, which can amount to practicing defensive medicine. The patient should choose whether to litigate or not, if an adverse event occurs. When both agents have no dominant strategy, we obtain four scenarios representing the positive and negative forms of defensive medicine, with or without physician's moral hazard. We find that certain legal parameters can have opposite effects on the probabilities that physicians practice defensive medicine and that patients litigate, depending respectively on the form of defensive medicine and on the presence of moral hazard. This result can explain the ambiguous results, reported in empirical literature, of legal reforms aimed at discouraging defensive medicine and medical malpractice litigation.

Keywords

Game theory

Clinical risk

Defensive medicine

Epidemics

Malpractice litigation

Angelo Antoci is Full Professor of Mathematics for Economic and Financial Decisions at the University of Sassari. His research focuses upon the mathematical modelling of the social and economic effects of defensive medicine practices and of environmentally related behaviors, among other topics.

Alessandro Fiori Maccioni is Researcher at the Department of Economics and Business Sciences of the University of Cagliari. His research focuses on various issues in public economics, such as policy analysis and mathematical modelling of social insurance schemes, among other topics.

Paolo Russu is Associate Professor of Mathematics for Economic and Financial Decisions at the University of Sassari. His research focuses upon the mathematical modelling of the social and economic effects of defensive medicine practices and of environmentally related behaviors, among other topics.

Pier Luigi Sacco is Full Professor of Economic Policy at IULM University Milan, Senior Researcher at the metaLAB (at) Harvard, Cambridge MA, and at Bruno Kessler Foundation, Trento. His research focuses, among other topics, on the role of social norms and cultural transmission processes on the policy design and policy analysis in a variety of fields, including public health and culture.

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