The Real Crash
The threat of malpractice also spurs a nasty phenomenon called “defensive medicine.” What if there’s a 100,000,000-to-1 shot that a patient has a specific illness? What if checking on this costs $10,000 and is incredibly time consuming and painful for the patient? Rationally, you would ignore this risk and address more likely risks.
But in our world of malpractice litigation run wild, the doctor’s incentive is to run the test. Even though the odds of the patient having the illness is 0.000001 percent, you have to multiply those odds by the $10 million a malpractice suit could cost him if the patient had this illness and the doctor missed it. The smart play for the doctor is to order to test. The patient will not object to the cost, as he is not paying for it.
