We explore the deterrent effect of the tort system by assessing physician perceptions of the risk of being sued and the impact of those perceptions on their own practice. The data are from a mailed survey conducted in 1989 of a random sample of physicians who were practicing in New York State in 1984. The survey results were compared to the actual risk of suit using the between-group (Wald) test and logistic regression methods. We also surveyed physicians about practice changes undertaken in the last ten years, factors influencing practice standards, and the costs of being sued and included these in the analysis. On average, physicians estimate that 19.5 out of one hundred of their colleagues will be sued in a given year, approximately three times the actual rate, with significant differences by specialty, location, and suit history. Perceived risk is associated with self-reported changes in test-ordering frequency and reduction in practice scope. The median number of days lost from practice to defend a malpractice suit was three to five, and 6 percent of the physicians surveyed incurred some out-of-pocket expenses. These findings suggest that physicians respond to the messages sent by litigation in a manner consistent with the deterrent theory of tort litigation.

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