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Variations in malpractice rates help shape physician compensation, recruitment

Few issues unite physicians as can the mention of malpractice. Proponents of medical liability reform often attribute a wide range of consequences to rising malpractice costs (e.g., limited patient access, the rise of defensive medicine, etc.), but these secondary effects stem from a central notion: That rising malpractice costs reduce overall compensation. However, a controversial study published in the May 2006 Health Affairs suggests that the effects of malpractice costs on compensation may be exaggerated and the crisis may be a myth. The study analyzed AMA survey data from self-employed physicians nationally from 1970 to 2000.