No-fault system of compensation for obstetric injury: winners and losers.
OBJECTIVE
To determine whether Florida's implementation of a no-fault system for birth-related neurologic injuries reduced lawsuits and total spending associated with such injuries, and whether no-fault was more efficient than tort in distributing compensation.


METHODS
We compared claims and payments before and after implementation of a no-fault system in 1989. Data came from the Department of Insurance's medical malpractice closed claim files and no-fault records. Descriptive statistics were compiled for tort claims before 1989 and for tort and no-fault claims for 1989-1991. We developed two projection approaches to estimate claims and payments after 1989, with and without no-fault. We assessed the program's performance on the basis of comparisons of actual and projected values for 1989-1991.


RESULTS
The number of tort claims for permanent labor-delivery injury and death fell 16-32%. However, when no-fault claims were added to tort claims, total claims frequency rose by 11-38%. Annually, an estimated 479 children suffered birth-related injuries; however, only 13 were compensated under no-fault. Total combined payments to patients and all lawyers did not decrease, but of the total, a much larger portion went to patients. Compensation of patients after plaintiff lawyers' fees rose 4% or 44%, depending on the projection method used. Less than 3% of total payments went to lawyers under no-fault versus 39% under tort.


CONCLUSIONS
Some claimants with birth-related injuries were winners, taking home a larger percentage of their awards than their tort counterparts. Lawyers clearly lost under no-fault. Because of the narrow statutory definition, many children with birth-related neurologic injuries did not qualify for coverage.
Sloan
F A
FA
Center for Health Policy, Law and Management, and the Department of Economics, Duke University, Durham, North Carolina 27708, USA. fsloan@hpolicy.duke.edu
Whetten-Goldstein
K
K
Stout
E M
EM
Entman
S S
SS
Hickson
G B
GB
D001720:Birth Injuries / Q000191:economics*; D002547:Cerebral Palsy / Q000191:economics; D005260:Female; D005431:Florida; D006801:Humans; D016365:Liability, Legal / Q000191:economics*; D008318:Malpractice / Q000191:economics* / Q000331:legislation & jurisprudence*; D009774:Obstetrics; D011247:Pregnancy