Document Type

Article

Publication Date

2010

Abstract

This Article is organized as follows. Part II summarizes the common rhetoric in tort reform debates that places the blame for rising premiums on the liability system and touts tort reform as the cure-all for ailing insurance markets. It then summarizes empirical results, produced using Texas closed claims data and other data, which suggest not only that Texas tort reform advocates wrongly placed blame on the liability system, but also that noneconomic damages caps passed in 2003 have caused more harm than good. Part III describes results that suggest that the widely used tactic of pointing to jumbo jury verdicts to justify tort reform is misguided. While verdicts and payouts are positively correlated, patients and their lawyers, on average, recover only fifty-six cents of each dollar awarded. In addition, the larger the verdict, the lower the fraction paid. While judicial oversight and damages caps explain about a third of the difference between verdicts and payouts, the largest chunk of the difference is explained by the fact that patients rarely recover more than the provider's insurance policy limits. This finding is cause for concern, especially given the fact that coverage purchased by Texas physicians is lower than conventional wisdom would predict and is continually on the decline. The data paint a picture not of a liability system in crisis, but of a patient compensation crisis, one that might severely limit the ability of the liability system to deliver civil justice to negligently injured patients.

Publication Citation

59 DePaul L. Rev. 675-696 (2010)