Hospital Malpractice Claims Up

Recent research indicates that <"">malpractice claims against hospitals are on the rise, said The Wall Street Journal, citing Aon Risk Solutions and the American Society for Healthcare Risk Management.

According to the reports, earlier in the past ten years, claims growth had dropped for a few years consecutively, bringing the rate of increase down to 1.81 percent in 2006; however, the past three years have seen an increase to 1.95 percent last year, explained the Journal.

Last year alone—and only for hospitals, physician claims and claims against long-term care facilities are not included in the figure—there were some 44,000 claims, with claims related to obstetrics care and emergency room care creating the largest impact, said the Journal.

Although Erik Johnson, health care practice leader for Aon Risk Solutions’ Actuarial and Analytics Practice, said that there are some possible reasons for the increase—tort reform in some states and the flailing economy—there is no one, clear reason, wrote the Journal’s Health blog. Johnson pointed out that the change was not affected by the recent healthcare overhaul legislation, added the Journal.

Another potential reason could be that community hospitals’ hiring of physicians could be adding to liability costs that move from doctors to facilities, noted Johnson, who said that hospitals “should focus at least one eye on this [liability] expense,” quoted the Journal.

According to the Journal, each claim, with expenses, carries an average price tag of about four percent annually and is expected to reach $153,000 for incidents from 2009, said the Journal, noting that this figure only covers losses up to $2 million. The restriction concerns limiting unusual larger awards and is also meant to highlight more likely hospital expenses, noted the Journal.

Johnson pointed out that hospitals typically carry a large deductible; insurance is not tapped until a specific amount is reach, said the Journal.

Also of note, 23 percent of hospital professional liability costs originate with ”health-care acquired infections, health-care acquired injuries, medication errors, objects left in surgery, and pressure ulcers,” according to the report, said the Journal.

Aon pointed out that the liability costs are exceed inflation and notes that both hospitals and doctors should be prepared for higher liability costs, citing the 2010 Hospital Professional Liability and Physician Liability Benchmark Analysis, which was created by Aon Risk Solutions—the global risk management arm of Aon Corporation—in collaboration with the American Society for Healthcare Risk Management.

According to the report, anticipated costs could exceed $8.6 billion, with the obstetrics unit and the emergency department—$1.4 billion and $1 billion, respectively—contributing to that figure, noted Aon.

Loss rates—a measurement of total malpractice claims, per bed—are expected to increase five percent annually, said Aon, with hospitals expected to see a rate of $3,280 (a $150 increase from 2010’s and a $300 increase from 2009’s rates), said Aon.

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