reducing healthcare costs

MICRA's cap on non-economic damages saves the healthcare system billions each year. Increasing the cap to $500,000 or more would raise annual healthcare costs in California by at least $6.5 billion, and gutting it completely would increase professional liability premiums by at least 20.5 percent in California.

In the time since California passed its reforms in 1975, liability premiums for California doctors have increased 283 percent, compared to 925 percent for the rest of the United States.

NAICs' Profitability By Line By State 2004

Without MICRA, taxpayers would be forced to pick up a greater share of the cost of healthcare as higher insurance risk would drive healthcare providers away, compel hospitals to cut uncompensated care to the uninsured, and force employers to reduce or eliminate health insurance for workers altogether.

MICRA is the only reform policy enacted in California specifically to control medical professional liability costs. A 2005 analysis by a team of economists determined that MICRA's cap on non-economic damages accounts for the relatively low growth in professional liability insurance costs in California since 1988.

Attachments:

• Study quantifies MICRA's role in containing California's medical liability costs, not Prop. 103 (Hamm/Frech/Wazzan) (pdf)