ESTIMATING THE EFFECT OF DAMAGES CAPS IN MEDICAL MALPRACTICE CASES: EVIDENCE …

ABSTRACT Using claim-level data, we estimate the effect of Texas’s 2003 cap on noneconomic damages on jury verdicts, post-verdict payouts, and settlements in medical malpractice cases closed during 1988–2004. For pro-plaintiff jury verdicts, the cap affects 47-percent of verdicts and reduces mean allowed non-economic damages, mean allowed verdict, and mean total payout by 73-percent, 3…