Table 7.

OLS Regression of Health Care Costs on Malpractice Costs.

	Timing of Malpractice Awards Per Capita:
	Current Year	Three-Year Moving Average: Lags 1, 2 and 3 Years
Hospital Cost Estimates
Dependent Variable: Hospital facility expenditures per bed
Malpractice Awards Per Capita	-117.459 (143.050)	-197.162 (197.106)
Elasticity	-0.0026	-0.0039
Dependent Variable: Hospital facility expenditures per bed-day
Malpractice Awards Per Capita	-0.296* (0.150)	-0.355 (0.564)
Elasticity	-0.0031	-0.0035
Total Deaths per 1,000 Population
Malpractice Awards Per Capita	0.005** (0.002)	0.013* (0.007)
Elasticity	0.0037	0.0092
Deaths per 1,000 Age 20 to 64
Malpractice Awards Per Capita	0.003* (0.001)	0.005 (0.004)
Elasticity	0.0042	0.0075
Deaths per 1,000 Age 65 and up
Malpractice Awards Per Capita	0.019*** (0.007)	0.050* (0.027)
Elasticity	0.0023	0.0059

Notes: The table reports the estimated effect of per capita malpractice jury award dollars on medical expenditures. Each coefficient is from a separate regression, and each column represents a different lag for the malpractice variable. The unit of analysis is a hospital-year. County population is used as a weight in all regressions. Other explanatory variables include hospital and year fixed-effects, a quadratic for per capita income, the percent of the population that is male, white, African-American, and that falls into 5-year age ranges. Elasticities are evaluated at the mean values of the dependent and independent variables. Robust standard errors allowing clustering at the county level are reported in parentheses.

^***A *** represents statistical significance at the 1% level.