For healthcare providers, there is perhaps no word that elicits as much confusion, fear and anger as “malpractice.” It is often the topic of impassioned debate among political leaders, policymakers, insurance companies and nonprofit groups. It even occasionally informs the storylines of Hollywood blockbusters, which tend to portray the subject as black-and-white.

The truth, however, is much more complex. A key issue within any healthcare system, malpractice is a continually evolving and controversial subject. Although the effects of malpractice appear to apply mainly to doctors, patients and lawyers, any case of medical malfeasance affects healthcare providers at all levels, especially those in managerial and leadership positions.

How Does Malpractice Affect Society and the Healthcare Industry?

Medical malpractice is generally defined as “improper, unskilled or negligent treatment of a patient by a physician, dentist, nurse, pharmacist or other healthcare professional.” In 2021, medical malpractice payouts totaled more than $3.1 billion, representing over 9,000 payment reports, according to data generated from the National Practitioner Data Bank’s Data Analysis Tool.

The effects of malpractice on patients, whether or not they are actually involved in a legal suit, can be substantial. News or rumors of malpractice for a medical practice or hospital can be a turnoff for potential patients, making them reluctant to seek help. Concerns regarding negligence can make patients nervous and impede a trustworthy and open interaction — the cornerstone of doctor-patient relationships.

Circumstances like the COVID-19 pandemic can further complicate matters surrounding medical malpractice. Patients’ fears of malpractice can lessen their trust in vaccines and safety measures that have been proven effective. Fears of litigation related to healthcare practices during the pandemic led to legislation being passed to shield healthcare providers from medical liability in many cases. Yet, some doctors spread misinformation surrounding COVID-19, spurring calls for misinformation to be treated as malpractice. Clearly, medical malpractice is a complicated subject, especially during challenging, disruptive times.

Malpractice May Affect the Cost of Healthcare

Already, many Americans cannot afford adequate medical care. Physicians and other healthcare providers have long argued that malpractice claims are a leading cause of escalating healthcare costs. The worry is that as malpractice legal suits become more commonplace, and claimants receive settlements for millions of dollars, patients will have to swallow some of these costs through higher insurance premiums and doctor’s fees.

Malpractice insurance premiums for doctors can also affect patients. The premiums can vary drastically by state and by medical specialty but have been rising consistently for years. The cost of rising premiums may be passed on to patients or force doctors to reduce services offered. Rising premiums may also cause doctors to move to states with more manageable costs, which in turn will greatly influence patient access to the best doctors. Access to healthcare may grow increasingly limited in areas where premiums are especially high.

Another concern for patients arises from doctors practicing “defensive medicine,” a euphemism for the ordering of additional tests and procedures that are not strictly necessary but provide protection against claims of negligence and malpractice charges.

Likewise, the effects of malpractice on doctors and other healthcare professionals are substantial. Being involved in a legal suit rarely involves only the insurance companies and the lawyers resolving the matter. Rather, it is a great cause of stress in a healthcare professional’s life. It can make professionals question their abilities, which can in turn affect their job performance. In some cases, when the cost of malpractice insurance becomes too high, healthcare providers leave the industry to find work in a related field that carries less risk of litigation.

Your Role as a Healthcare Administrator

Those aspiring to leadership roles in the medical services industry must familiarize themselves with the effects of malpractice. Senior executives and managers in the healthcare field will need at least a basic understanding of such things as duty of care, causation and negligence — as well as the laws and policies regarding malpractice and insurance that vary by state.

Malpractice claims have far-reaching financial, psychological and social effects on patients and healthcare providers at every level. Loss of key staff members and the negative publicity associated with malpractice suits can do untold damage to a hospital or medical clinic. Furthermore, the rising cost of malpractice insurance can have a significant impact on the success and sustainability of a hospital or medical practice.

One of the best ways to prepare yourself for the challenges of a career in healthcare administration is through an online Master of Business Administration (MBA) program in healthcare administration. Some educational institutions, like Texas A&M University-Corpus Christi, offer an online MBA with a Concentration in Healthcare Administration. This program provides a comprehensive analysis of the legal, social and ethical aspects of the healthcare system, including such issues as liability, consent and malpractice. Students will also learn about the regulating bodies for malpractice laws and issues.

Plus, in an online MBA program, working professionals can schedule their studies around their personal and professional lives. An online MBA program with a concentration in healthcare administration can offer future healthcare executives the skills needed to tackle the complex challenges facing the healthcare industry today.

Learn more about the TAMU-CC online MBA with a Concentration in Healthcare Administration program.