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The hidden incentives driving frivolous malpractice lawsuits

Howard Smith, MD
Physician
June 16, 2025
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Eighty-five thousand medical malpractice lawsuits are filed per year, but the total number of claims reviewed by lawyers is unknown. What underlies their decision to proceed is their inability to determine which complication results from a systemic medical error in a medical intervention and which is just a random error of nature.

Reflected in this 85,000 is that two-thirds—52,000—are summarily dismissed and 4,600 are defense verdicts, and one-third—27,000—are settlements and 1,400 are plaintiff verdicts. Whether this is acceptable or not, it stands to reason that more meritorious lawsuits remain unrepresented than the total of cases filed. Many legitimate victims of medical malpractice never get their day in court, and many innocent physicians are sued. It is reasonable to assume that the tort system, as is, serves the interests of attorneys more than it serves the interest of justice because nothing is done to improve it.

How would a claimant know if a complication is a medical error or a random error of nature?

Plaintiff attorneys should know. After all, personal injury is what they do, and they are the ones who review all the claims and decide which become the 85,000 they file. Yet, as long as there is a value in 27,000 settlements, plaintiff attorneys could not care less if a complication is an error of nature. Plaintiff attorneys make about $2.7 billion per year just from settlements.

Defense attorneys are no better. As long as plaintiff attorneys file 85,000 lawsuits for them to defend, defense attorneys could not care less either. They are paid by malpractice carriers. Defense attorneys make $2.5 billion per year just for defending cases regardless of causes or, for that matter, outcomes.

Medical experts should know. After all, they are doctors. As long as these attorneys pay medical experts as “hired guns,” they could not care less. True, false, or indifferent, the average medical expert makes about $140,000 per year for rendering an opinion.

Malpractice carriers should know; after all, they have a slew of risk managers and actuaries working for them. They, too, could not care less if a claim has no merit. As soon as an insurance carrier gets the notion of a sympathetic jury, it is cheaper for them just to settle the case—even if frivolous—rather than to risk a plaintiff verdict by defending it.

The tort system is not without culpability. Many jury verdicts exceed $1 million and take years. One, in fact, was $229 million. It was frivolous and was overturned on appeal seven years after being filed.

The health care system is a story unto itself. Formerly, it was managed care; now, it is integrated networks of hospitals, medical institutions, and physician groups. Some networks are traditionally insured for medical malpractice. Others are self-insured in captives and/or in risk retention groups. In any case, the objective of the network is cheaper care. These networks require adherence to “resource-based practice guidelines,” a.k.a., “best practices.” A practice guideline is not a standard of care. It is essentially a shortcut designed to lower costs. As long as costs are lower, networks could not care less if a best practice is not a standard of care. Neither could they care less if practitioners are more vulnerable because, as a condition of their agency, practitioners comply with “best practices.”

Doctors have the most skin in the game. We should care. Some of us have malpractice premiums as high as $100,000 per year depending on specialty. As long as our premium is paid by the networks for whom we work, we could not care less if a practice guideline is not a standard of care.

The AMA should care; after all, it is the official voice for doctors. Yet, it recently redefined “a practice guideline” so that the evidence upon which it is based is competence. As long as doctors who are leaders of the AMA are also in cahoots with networks and government agencies, the AMA could not care less that practice guidelines are based on cost, not competence.

Lastly, politicians are the most prominent contributors to the problem. As long as many are attorneys and some, like Dick Durbin, begin their careers litigating medical malpractice, the best that can be expected of them are self-serving tort reforms.

One hand washes the other and greed is the path of least resistance. Ultimately, a culture develops in which there is complete disdain for practitioners and claimants; both are victims of a defective medical malpractice system. No wonder that a disproportionate number of medical malpractice claims have no merit and many that do have no representation.

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I am a physician. As long as I have an 8.5 percent chance per year of being sued, I care. That is the reason for my posts. Yet from comments I see, many of you agree but believe nothing could be done. Remember that when next you are sued.

Howard Smith is an obstetrics-gynecology physician.

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