IDEAS home Printed from https://ideas.repec.org/a/ucp/jlstud/v36y2007is2ps261-s289.html
   My bibliography  Save this article

Unlimited Subrogation: Improving Medical Malpractice Liability by Allowing Insurers to Take Charge

Author

Listed:
  • Kenneth S. Reinker
  • David Rosenberg

Abstract

This article proposes unlimited insurance subrogation (UIS) to improve the insurance and deterrence results of medical malpractice liability. Unlimited insurance subrogation enables patients to assign their entire potential medical malpractice claims to their first-party insurers without limitation as to the amount the insurers pay out in benefits or recover in tort damages. Unlimited insurance subrogation should improve insurance outcomes by converting suboptimal tort insurance into more optimal first-party insurance. Establishing first-party insurers as plaintiffs to confront liability insurers on the defense side should improve deterrence through more effective prosecution of meritorious claims and by harnessing the insurers' incentives for cooperation to reduce meritless and unnecessary litigation. In addition, UIS should encourage further reforms by contract between the first-party and liability insurers who would take charge of the system. This article shows that loss of patient cooperation, insurer gaming, and other possible problems with UIS are unlikely to arise or are readily solvable. (c) 2007 by The University of Chicago. All rights reserved.

Suggested Citation

  • Kenneth S. Reinker & David Rosenberg, 2007. "Unlimited Subrogation: Improving Medical Malpractice Liability by Allowing Insurers to Take Charge," The Journal of Legal Studies, University of Chicago Press, vol. 36(S2), pages 261-289, June.
    • Handle: RePEc:ucp:jlstud:v:36:y:2007:i:s2:p:s261-s289
    DOI: 10.1086/519468
    as

    Download full text from publisher

    File URL: http://dx.doi.org/10.1086/519468
    File Function: link to full text
    Download Restriction: Access to the online full text or PDF requires a subscription.
    File URL: https://libkey.io/10.1086/519468?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Sykes, Alan O, 2001. "Subrogation and Insolvency," The Journal of Legal Studies, University of Chicago Press, vol. 30(2), pages 383-399, Part I Ju.
    2. David Rosenberg, 1986. "The Uncertainties of Assigned Shares Tort Compensation: What We Don't Know Can Hurt Us," Risk Analysis, John Wiley & Sons, vol. 6(3), pages 363-369, September.
    3. Calfee, John E & Rubin, Paul H, 1992. "Some Implications of Damage Payments for Nonpecuniary Losses," The Journal of Legal Studies, University of Chicago Press, vol. 21(2), pages 371-411, June.
    4. Michael Spence, 1977. "Consumer Misperceptions, Product Failure and Producer Liability," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 44(3), pages 561-572.
    5. A. Mitchell Polinsky & Daniel L. Rubinfeld, 2003. "Aligning the Interests of Lawyers and Clients," American Law and Economics Review, American Law and Economics Association, vol. 5(1), pages 165-188.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. A. Mitchell Polinsky & Steven Shavell, 2017. "Subrogation and the Theory of Insurance When Suits Can Be Brought for Losses Suffered," NBER Working Papers 23303, National Bureau of Economic Research, Inc.
    2. Daniel L. Chen, 2015. "Can markets stimulate rights? On the alienability of legal claims," RAND Journal of Economics, RAND Corporation, vol. 46(1), pages 23-65, March.
    3. Gomez, Fernando & Penalva, Jose, 2015. "Tort reform and the theory of coordinating tort and insurance," International Review of Law and Economics, Elsevier, vol. 43(C), pages 83-97.
    4. Spurr, Stephen J., 2021. "Subrogation and its consequences for tort litigation," International Review of Law and Economics, Elsevier, vol. 67(C).

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Hoffmann, Sandra A. & Hanemann, W. Michael, 2005. "Torts and the Protection of "Legally Recognized" Interests," Discussion Papers 10472, Resources for the Future.
    2. Dari-Mattiacci, Giuseppe & Langlais, Eric, 2012. "Social Wealth and Optimal Care," International Review of Law and Economics, Elsevier, vol. 32(2), pages 271-284.
    3. Geistfeld, Mark, 1995. "Manufacturer moral hazard and the Tort-contract issue in products liability," International Review of Law and Economics, Elsevier, vol. 15(3), pages 241-257, September.
    4. Liqun Liu & Andrew Rettenmaier & Thomas Saving, 2009. "Conditional payments and self-protection," Journal of Risk and Uncertainty, Springer, vol. 38(2), pages 159-172, April.
    5. Steven Shavell, 2005. "Liability for Accidents," NBER Working Papers 11781, National Bureau of Economic Research, Inc.
    6. Fraser, Clive D., 1996. "On tort as an implicit insurance system with state-dependent utility: The case of child mortality risk," International Review of Law and Economics, Elsevier, vol. 16(4), pages 449-459, December.
    7. J. K. Pappalardo, 2022. "Economics of Consumer Protection: Contributions and Challenges in Estimating Consumer Injury and Evaluating Consumer Protection Policy," Journal of Consumer Policy, Springer, vol. 45(2), pages 201-238, June.
    8. Roman Inderst & Marco Ottaviani, 2013. "Sales Talk, Cancellation Terms and the Role of Consumer Protection," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 80(3), pages 1002-1026.
    9. Tomas J. Philipson & Eric Sun, 2008. "Is the Food And Drug Administration Safe And Effective?," Journal of Economic Perspectives, American Economic Association, vol. 22(1), pages 85-102, Winter.
    10. Junhong Chu & Pradeep K. Chintagunta, 2009. "Quantifying the Economic Value of Warranties in the U.S. Server Market," Marketing Science, INFORMS, vol. 28(1), pages 99-121, 01-02.
    11. W. Bentley MacLeod, 2006. "Reputations, Relationships and the Enforcement of Incomplete Contracts," CESifo Working Paper Series 1730, CESifo.
    12. Shaun M. Tanger & Richard Alan Seals Jr. & David N. Laband, 2011. "Does Bill Co-sponsorship Affect Campaign Contributions?: Evidence from the U.S. House of Representatives, 2000-2008," Auburn Economics Working Paper Series auwp2011-09, Department of Economics, Auburn University.
    13. Alessandro De Chiara & Juan José Ganuza & Fernando Gómez & Ester Manna & Adrián Segura, 2023. "Platform liability with reputational sanctions," Economics Working Papers 1868, Department of Economics and Business, Universitat Pompeu Fabra.
    14. Centner, Terence J. & Wetzstein, Michael E., 1994. "Automobile And Tractor Lemon Laws," 1994 Quantifying Long Run Agricultural Risks and Evaluating Farmer Responses Risk, Technical Committee Meeting, March 24-26, 1994, Gulf Shores State Park, Alabama 271679, Regional Research Projects > S-232: Quantifying Long Run Agricultural Risks and Evaluating Farmer Responses to Risk.
    15. Joaquín Coleff, 2020. "Can consumer complaints reduce product reliability? Should we worry?," Journal of Economics & Management Strategy, Wiley Blackwell, vol. 29(1), pages 74-96, January.
    16. Ayouni, Mehdi & Friehe, Tim & Gabuthy, Yannick, 2024. "Bayesian persuasion in lawyer–client communication," International Review of Law and Economics, Elsevier, vol. 78(C).
    17. Joshua Schwartzstein & Andrei Shleifer, 2013. "An Activity-Generating Theory of Regulation," Journal of Law and Economics, University of Chicago Press, vol. 56(1), pages 1-38.
    18. Cotten, Stephen J. & Santore, Rudy, 2012. "Contingent fee caps, screening, and the quality of legal services," International Review of Law and Economics, Elsevier, vol. 32(3), pages 317-328.
    19. Darghouth, M.N. & Ait-kadi, D. & Chelbi, A., 2017. "Joint optimization of design, warranty and price for products sold with maintenance service contracts," Reliability Engineering and System Safety, Elsevier, vol. 165(C), pages 197-208.
    20. Helmut Bester & Matthias Lang & Jianpei Li, 2021. "Signaling versus Auditing," RAND Journal of Economics, RAND Corporation, vol. 52(4), pages 859-883, December.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:ucp:jlstud:v:36:y:2007:i:s2:p:s261-s289. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Journals Division (email available below). General contact details of provider: https://www.journals.uchicago.edu/JLS .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.