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Patient Safety and Medical Liability Reform: Putting the Patient First

By Carolyn M. Clancy, M.D.

Commentaries by AHRQ director, Dr. Carolyn Clancy, and other staff members.

This commentary first appeared in the September/October 2010 issue of Patient Safety and Quality Healthcare.

Recent research shows a significant correlation between the frequency of adverse events and malpractice claims (Greenberg et al., 2010). Meanwhile, information from patient satisfaction surveys and patient experiences of care have been shown to predict malpractice risk (Fullam et al., 2009). The rationale behind a new initiative President Obama announced last year builds on the connections between patient safety and medical liability by testing models to enhance patient safety, fairness, and communication.

Eliminating or reducing the risks and hazards in the delivery of care should yield safer care and potentially reduce medical liability claims. President Obama underscored that theme in his address to Congress on September 9, 2009, when he announced his health insurance reform proposals.

"I don't believe malpractice reform is a silver bullet, but I've talked to enough doctors to know that defensive medicine may be contributing to unnecessary costs. So I'm proposing that we move forward on a range of ideas about how to put patient safety first and let doctors focus on practicing medicine."

This effort advanced in June when the Agency for Healthcare Research and Quality (AHRQ) allocated $23 million in grants to support efforts by States and health systems to create or implement and evaluate patient safety approaches and medical liability reforms. An additional $2 million was allocated to evaluate the overall knowledge that is gained from this initiative.

The grants test models that:

  • Put patient safety first and work to reduce preventable injuries.
  • Foster better communication between doctors and their patients.
  • Ensure that patients are compensated in a fair and timely manner for medical injuries, while also reducing the incidence of frivolous lawsuits.
  • Reduce liability premiums.

Many of the grants in this initiative, the largest Federal investment of its kind, focus on reducing harm and medical liability in health care settings. This approach is of particular interest for patient safety and quality improvement officers, medical directors, and providers working on the front lines of patient care. Just as previous AHRQ grants and programs help health care providers improve care quality today, the approaches being tested under this initiative may provide health care organizations and States with approaches that can improve patient safety and lower medical liability claims in the future.

The Patient Safety and Medical Liability Disconnect

Despite the national attention that was given to patient safety in the Institute of Medicine (IOM) report, To Err Is Human, the problems associated with injury and harm due to process of care persist. More than 15 percent of patients receiving hospital care are harmed by the process of care they receive (National Healthcare Quality Report, 2009).

The U.S. medical liability system is designed both to compensate patients who suffer injury because of medical negligence and to reduce the likelihood of patients being harmed in the future (Hellinger et al., 2009). Yet the system has not performed adequately on these goals. Only 22 cents of every dollar spent settling a medical liability claim is spent on compensating patients, studies show (Rubin et al., 2007).

Patients who are seriously harmed from the process of care often wait for years before receiving compensation. Meanwhile, many physicians believe medical liability concerns force them to order unnecessary tests and practice so-called defensive medicine. There is also varied experience with local and State patient safety and medical liability reform efforts. Disagreement also exists over solutions to fix the problems (Hellinger et al., 2009).

The most significant concerns revolve around patient safety, the impact of medical liability on health care costs, provider access to liability coverage, and the administrative burden of litigation. To address these areas, States and health systems have implemented or considered reforms including full disclosure/early-offer programs, monetary caps on damage awards, and pretrial screening panels.

However, AHRQ researchers reviewing the impact of these approaches found "little solid evidence" about the impact of medical liability reforms on the cost of care and even less information about the impact of these reforms on patient safety (Hellinger et al., 2009). Furthermore, the medical liability system may actually hamper progress on patient safety by dissuading physicians from disclosing and examining the root causes of medical errors (Studdert et al., 2004).

Linking Patient Safety and Medical Liability Solutions

The goal of the Patient Safety and Medical Liability Reform Initiative is improving the overall quality of health care by making patient safety the primary goal. In doing so, the effort aims to connect medical liability to patient safety and quality, while bridging the differences that highlight the punitive and individualistic approach of tort law with the nonpunitive, systems-oriented approach embraced by the patient safety movement.

The programs under the initiative acknowledge limitations of the current medical liability system. Among the 20 grants, some support the development of State-endorsed evidence-based care guidelines, the promotion of transparency and enhanced communication between providers and patients, and early disclosure and offers of prompt compensation.

The goals of other grants include the following:

  • Filling the evidence gap regarding the impact of patient safety and litigation rates of programs aimed to enhance communication, transparency, and event disclosure. The same grant will evaluate the impact on medical liability and patient safety of extending an existing events disclosure program from an academic hospital setting to community hospitals.
  • Reviewing the use of a disclosure and compensation model, which promptly informs and compensates injured patients and families. The effort also sets out to identify best practices for using disclosure to improve patient safety and disseminating best practices to serve patients' needs.
  • Improving patient safety and empowering patients to participate in their care by developing and implementing patient-friendly shared decisionmaking tools and processes for patients undergoing orthopedic surgery.
  • Protecting obstetrical and surgery patients from injuries caused by providers' errors and reducing the cost of medical malpractice through the use of an expanded court-directed alternative dispute resolution model currently used in New York State courts.
  • Engaging clinicians, patients, malpractice insurers, and the Massachusetts State Department of Public Health to ensure more timely resolution of medical errors that occur in outpatient practices and improve communication in all aspects of care.

Building on a Strong Foundation

AHRQ has a robust track record of encouraging the implementation of safe practices in health care facilities and organizations, as well as producing and disseminating tools and resources to support safe practices.

AHRQ and the Department of Defense (DoD), for example, developed an evidence-based curriculum and training support for teamwork improvement called TeamSTEPPS®. Improved teamwork has been shown to decrease the incidence of injury and reduce medical liability claims in labor and delivery units. (Mann et al., 2006). Simulation used in conjunction with improved teamwork has shown to make dramatic improvements, especially in high-risk areas such as labor and delivery.

Another proven patient safety program funded by AHRQ, the Keystone Project, is being expanded on a national basis. Keystone helped 100 Michigan intensive care units reduce the rate of bloodstream infections from intravenous lines by two-thirds within 3 months—and sustained those large reductions for 5 years. The project will allow hospitals in 50 States to reduce bloodstream and other healthcare-associated infections that endanger patients in ICUs and other units.

Meanwhile, AHRQ has played a major role in supporting the work of Patient Safety Organizations. PSOs, authorized under the Patient Safety and Quality Improvement Act of 2005, improve quality and safety through the collection and analysis of data on patient events. They provide privilege and confidentiality to providers and health care organizations reporting those events.


The Patient Safety and Medical Liability Initiative builds on the experiences and insights of these and other efforts. We are optimistic that the AHRQ-funded projects will produce measurable improvements in safety for patients and help bring rationality and fairness to our medical liability system. Projects will be rigorously evaluated to develop the evidence base that will inform long-term solutions to the medical liability problem, and to help health care organizations implement beneficial reforms.

A decade following our national awakening to the magnitude of the patient safety crisis, solutions that emphasize improvements in processes of care and the safety of each patient may finally be in sight.

Carolyn Clancy is director of the Agency for Healthcare Research and Quality, Rockville, Maryland. She is a general internist and holds an academic appointment at George Washington School of Medicine in Washington, DC. She may be contacted at


Agency for Healthcare Research and Quality. National Healthcare Quality Report. Rockville, MD: Agency for Healthcare Research and Quality; 2009. Available at: . Accessed July 27, 2010.

Fullam F, Garman AN, Johnson TJ, Hedberg EC. The use of patient satisfaction surveys and alternative coding procedures to predict malpractice risk. Med Care 2009;47(5): 553-9.

Greenberg MD, Haviland AM, Ashwood JS, Main R. Is better patient safety associated with less malpractice activity? Evidence from California. Santa Monica: RAND Institute for Civil Justice; 2010.

Hellinger FJ, Encinosa WE. Review of reforms to our medical liability system. Available at Accessed July 15, 2010.

Institute of Medicine (10M). To err is human: Building a safer health system. In: Kohn LT, Corrigan JM, Donaldson MS, editors. Washington, DC: National Academy Press; 2000.

Mann S, Marcus R, Sachs B. Lessons from the cockpit: how team training can reduce errors on L&D. Contemporary OB/GYN Jan 2006;34-45.

Rubin P, Shepherd J. Tort reform and accidental deaths. J Law Econ 2007(May); 50(2): 221-38.

Studdert OM, Mello MM, Brennan TA. Medical malpractice. N Engl J Med 2004;350( 4): 283-92.

Page last reviewed October 2010
Internet Citation: Patient Safety and Medical Liability Reform: Putting the Patient First: By Carolyn M. Clancy, M.D.. October 2010. Agency for Healthcare Research and Quality, Rockville, MD.


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