The authors of the article ‘Damages Caps in Medical Malpractice Cases’ are concerned with the effects of the damages caps reform. Specifically, they focus on whether liability caps reduce the cost of medical liability insurance, their effects on improved access to health care, and their ability to lower the cost of health insurance (Nelson, Morrisey, & Kilgore, 2007). They conclude that damages caps reduce liability insurance premiums.
Policy or Law Related to the Problem
The Help Efficient, Accessible, Low-cost, Timely Healthcare (HEALTH) Act of 2002 is the policy related to the problem (SCBA, n. d.).
Relevance of the Topic to Health Policy
The topic is relevant to health policy in various ways. For example, it helps health stakeholders understand the relationship between medical malpractice insurance costs and health care costs. Damages caps are of particular importance to insurers because they reduce uncertainty, thereby making it easy for them to set insurance premiums. It also helps them to understand the effects of the damages caps to the price of health care access. It also helps stakeholders understand the different factors for malpractice premiums, which are expected losses, actual accrued losses, the cost of reinsurance, and investment returns of the assets held by insurers.
An understanding of the topic is also important as it helps stakeholders evaluate the benefits of damages caps against their disadvantages. For instance, stakeholders can evaluate reduced cost of healthcare against the reduced legal medical malpractice cases that may be filed, as the expenses of filing such suits might exceed the expected awarded damages. The topic is also important in understanding how physicians make cost versus benefit decisions, such as the preference to facing liability for malpractice to providing expensive treatment that complies with the legal standard of care.