Friday, June 05, 2009

Tort Standards Pose a Litigation Risk for Innovation in US Hospitals


Part Eight/Tort law locks US hospitals in to expensive and conventional practices and exposes potential disruptive innovators to liability. Don't expect innovation in US healthcare until negligence law is overhauled.

In addition to the burdens of having no way to fund innovation in US hospitals, there is also the ever present threat that any innovation may be labeled a deviation from the 'community standard.' This vulnerability exposes would-be innovators to liability that does not threaten incumbent providers, who abide by a strict status quo.

And amazingly, even though certain doctrines in negligence law have been known to hold providers liable when when courts find the community standard too low, no such doctrine allows providers to escape liability by arguing that a widely held community standard is too high.

US medical malpractice law penalizes innovation that cannot match the quality of the current paradigm, even if the innovation offers cost advantages and even if the innovation's quality improves over time. Initial offerings that do not meet a community standard will be deemed malpractice.

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