Search results

In healthcare, overuse and underuse of medical treatments represent equally dangerous deviations from an optimal use equilibrium and arouse concerns about possible implications for patients’ health, and for the healthcare system in terms of both costs and access to medical care. Medical liability plays a dominant role among the elements that can affect these deviations. Therefore, a remarkable economic literature studies how medical decisions are influenced by different levels of liability. In particular, identifying the relation between liability and treatments selection, as well as disentangling the effect of liability from other incentives that might be in place, is a task for sound empirical research. Several studies have already tried to tackle this issue, but much more needs to be done. In this chapter, we offer an overview of the state of the art in the study of the relation between liability and treatments selection. First, we reason on the theoretical mechanisms underpinning the relationship under investigation by presenting the main empirical predictions of the related literature. Second, we provide a comprehensive summary of the existing empirical evidence and its main weaknesses. Finally, we conclude by offering guidelines for further research.

Public reports of provider-specific patient outcomes aim to help consumers select suppliers of medical services. Yet, in an environment of rapidly changing medical technology and increasingly heterogeneous patient populations, and because they necessarily reflect the experience of other patients who received care in the past, such reports may be of limited value in helping patients forecast the probability of an adverse outcome for each provider they are considering. I propose that providers underwrite insurance policies that promptly pay patients a predetermined sum after an adverse outcome. Patients can use such outcome warranties to infer quality differences among providers easily and reliably. In addition, outcome warranties efficiently reward both providers and patients for reducing the risk of adverse outcomes and thereby improve the safety and affordability of health care. As such, outcome warranties help advance four important goals of health care management: reduction of financial risk, recruitment and retention of physicians, remediation of adverse outcomes, and raising the provider's reputation.

This paper analyzes the perception by researchers, public policy makers, and physicians that the medical malpractice system is in disarray and in need of reform. The perception of a medical malpractice crisis arose because of what was viewed as sudden and dramatic increases in physician liability for malpractice. Contrary to the common perception, however, previous research has shown that historical growth rates in physician liability are similar in magnitude to current growth rates. This paper focuses on explaining the conditions under which increased physician liability would be optimal. According to the theoretical model, increased physician liability would be optimal when (1) physicians become more adept at curing patients, especially by increased technological ability, (2) the costs of physicians' time increases, or (3) the cost to physicians of defending against malpractice claims decreases. The paper carefully examines the available historical evidence that indicates that these three reasons account for much of the increased liability of physicians in the United States. The finding that much of the historical increases in physician liability are consistent with the model, further questions the existence of a medical malpractice crisis.

The coming use of autonomous vehicles has kindled an extensive debate over the choice of a desirable liability regime. This article contributes to that debate by explaining how rules for liability and damages ought to be constructed to deal first with stranger (including highway) cases and then with consensual cases (like medical malpractice). It concludes that an output regime based on events as they unfold is applicable in the former but not in the latter. It then argues that this legal regime carries over without a hitch to autonomous vehicles. It then further notes that in private disputes there are no fixed rules for deciding how to mix rules for injunctions and liabilities for threatened harms, and further notes that the regulatory regime for IoT will face those same difficulties, which are best solved by trying to minimize the sum of Type I and Type II errors, as in other cases.

Legal reasoning/analysis.

One salient point is that the rules of the road should change in response to technical innovation, but liability rules should not. The sound approach for dealing with damages for past incidents ought to be constructed to deal first with stranger (including highway) cases in which there is a dichotomous decision on compliance or not. That regime is based on events as they unfold, and carries over without a hitch to autonomous vehicles. For dealing with the prevention of future harms from violation of these rules, by contrast, there are no fixed rules for deciding how to mix damages with injunction, and the substitution of a system of direct state enforcement faces the same difficulties of implementation. In both settings, the rules of the road should be held constant, after which the ideal remedial mix follows the traditional approach of trying to minimize the sum of Type I and Type II errors, relating to over and underenforcement. The basic rules of tort liability stand in contrast to the different standards of liability that arise in consensual situations, and in all cases, they must necessarily be supplemented by rules of vicarious and product liability. Overall, the bottom line is this: autonomous vehicle innovations are relevant to designing regulations for future and uncertain harms, but irrelevant to liability for past harms.

This is an original legal analysis on the topic of Autonomous Vehicles.

To explore from an ethical paradigm the current research in support of and opposition to imposing caps on non‐economic damages as a means of addressing the healthcare crisis.

A review of peer‐ and non‐peer‐reviewed articles primarily covering the period from 2001‐2004, which addresses the rationale articulated in support of and in opposition to imposing caps on non‐economic damages. The articles are sorted into sections and critiqued: rationale for imposing caps, arguments against caps, ethical paradigms impacting caps, and conclusions.

Provides information from the various sources. Addresses the biases that may have shaped the authors' conclusions and some of the ethical paradigms that may have impacted positions. Also demonstrates that the unbiased research seems to establish a minimal nexus between caps and the proposed impact.

Focus is exclusively on the US healthcare and judicial system. However, findings may still have implications outside the USA in countries that have similar tort laws for addressing private wrongs.

A useful source of information for graduate students in public policy or healthcare management courses, or legislators looking for a quick reference to research regarding this topic area.

This paper fulfills an identified resource for non‐biased assessment of the problem presented and provides a critical review of the reasons articulated in support of this public policy.

The purpose of this paper is to explore the demand-side factors that influence the inbound medical tourists’ (MTs) decision to travel abroad for medical treatment/surgery.

The researchers conducted thematic analysis of in-depth interviews in India with 24 foreign MTs’ to generate the themes, identify factors and propose a model with hypothesis for future quantitative survey.

The findings conclude that patients ranked in ascending order less waiting time for surgery, healthcare quality and accreditation, staff/surgeons expertise, healthcare information, hospital facilities and services, patient safety, travel risk, surgical costs and holiday opportunity as important factors that influence the decision to travel abroad for medical treatment/surgery.

Foreign patients from six private hospitals were willing to be interviewed with the permission of the hospital. Due to confidentiality and privacy policy, many hospitals declined interviews with foreign patients.

The findings are generalised in case of foreign patients as MTs and all private hospitals treating foreign patients in India and other global healthcare destinations. Policy implications suggest that private hospitals in developing countries need to provide first-class quality of healthcare as foreign patients look for internationally accredited quality, no waiting time, patient safety, qualified and experienced surgeons, healthcare workers education and experience hospital facilities and post-surgery care with positive healthcare outcomes.

There is little empirical research on the views of inbound MTs, about factors influencing their decision to travel abroad for surgery to India.

The purpose of this paper is to determine the market‐value relevance of frontier efficiency scores and to test hypotheses from corporate control and production theory by analyzing the market response to US property–liability (P–L) insurer acquisitions and divestitures.

Cost and revenue efficiencies are estimated based on accounting data for US P–L insurers using data envelopment analysis. The market‐value response to acquisitions and divestitures is estimated using a standard market model event study. Regression analysis is used to measure the relationship between abnormal returns (dependent variable) and efficiency (independent variable), along with a set of control variables.

The results show that acquirers, targets and divesting firms all have significant positive abnormal returns around announcement dates. We also find that efficient acquirers and targets have higher cumulative abnormal returns (CAR) but inefficient divesting firms have higher CARs.

The findings are consistent with insurance acquisitions and divestitures being driven primarily by value‐maximizing motivations, consistent with corporate control and production theory.

Frontier efficiency scores based on accounting data provide value‐relevant information for insurance managers.

This is one of only a few papers that relate frontier efficiency to market values and is the first paper to do this for the insurance industry. It is also one of only two existing papers that analyze the value relevance of efficiency scores in the context of mergers and acquisitions.

The purpose of this paper is to understand the association between litigation risk and working capital management.

The authors employ four different regression techniques (OLS regressions, regressions with industry and time controls, median regressions, and Fama Macbeth regressions) to study the relation between litigation risk (contemporaneous and lagged measures) and working capital management (cash conversion cycle (CCC) and its components). The authors also conduct numerous robustness tests.

The authors find that high-litigation risk firms tend to have longer CCC. Decomposing CCC into days receivable outstanding, days inventory outstanding and days payable outstanding, the authors find that high-litigation risk firms have longer receivable periods, take a longer time to convert inventory to cash and do not pay their suppliers promptly. These results are robust to a series of robustness tests including using an alternate measure of working capital and accounting for firm type (high-tech vs labor intensive).

This paper contributes in several ways to the litigation and corporate finance literature. The authors identify another determinant of working capital management and document another avenue whereby legal institutions affect short-term financial decision making. The link between litigation risk and working capital management is of interest to the business community, financial economists, management and the investing public.