The incentive effects of malpractice liability rules on dental practice behavior

The impact of malpractice liability rules on dental practice behavior was estimated using data from a 1992 nationwide survey of US general dentists. The study examined the premise that malpractice liability rules can affect quality of care and related resource allocation decisions by dentists, but that market features, such as relatively complete and "non-experience rated" malpractice insurance, are likely to weaken the incentive effects of malpractice liability.

General practice dentists in the United States were selected randomly, and 3,048 dentists were studied by mail survey. Secondary data on county-level characteristics were used to measure market area factors. Quality-of-care measures were derived from the survey about self-reported practice policies and behavior and participation in continuing education. Legal measures were assembled from state statutes and appellate court decisions. Ordinary least squares was used to assess the relation between legal variables and dependent variables of quality of care, continuing education, and the rate of dental output.

Hypotheses about the effects of malpractice law on practice quality and participation in continuing education were not supported. The relation between pro-dentist law and output was supported. A number of legal provisions related to differences in practice behavior, but often in ways opposite to the expected direction.

The direct effects of specific malpractice liability rules on dentist practice behavior often failed to point in the direction predicted by theory and were economically insignificant. It is possible that relatively complete malpractice liability insurance, coupled with "noisy" liability rules, substantially dulls the deterrent effect of malpractice liability. Other forces, such as the dentist's past malpractice claims experience, were more significant in shaping dentist behavior.