Can No-Fault Compensation of Impaired Infants Alleviate the Malpractice Crisis in Obstetrics?

In 1987, Virginia initiated no-fault compensation for birth-related neurological injuries in an attempt to ensure the availability of malpractice insurance for the state's obstetricians. This paper explores some possible causes for the refusal of Virginia's insurers to write malpractice coverage for obstetricians and analyzes the ability of the act to resolve the medical malpractice crisis in obstetrics. It also examines the effect of this limited no-fault compensation scheme on obstetricians' incentives and on the welfare of neurologically damaged children.