| Abstract | In 2010, the Affordable Care Act was signed into law with various provisions taking effect over the following years, specifically the individual mandate in 2014. This reform drastically impacted the entire insurance industry, not simply health insurance, which is what many prior studies focused on. Early estimates indicated that health insurers might transfer costs to property and casualty insurers which would significantly impact the profitability of these companies. Despite the association of medical malpractice with healthcare, property and casualty insurers actually write the policies for medical malpractice incidents. Therefore, I chose to exclusively examine the impact of the Affordable Care Act upon the medical malpractice line of business for property and casualty insurers. My study worked to answer three questions, including (i) the change in the number of medical malpractice reports, especially in Medicaid expansion states, (ii) the change in the dollar amount of these claims, and (iii) the impact to the industry's net income. Through statistical tests and regressions using sample data on the number of medical malpractice reports and the inflation-adjusted dollar amounts of these claims in each of the 50 states from 2003 to 2018, healthcare consumption expenditures, and the number of individuals with health insurance, I concluded that the number of malpractice reports has increased and the dollar amount of claims has decreased since the enactment of the Affordable Care Act. However, only a portion of these changes can be attributed to the Affordable Care Act, as the additional number of people insured played a small role in the variations of the medical malpractice environment; rather, healthcare consumption expenditures substantially altered the medical malpractice statistics. Ultimately, I concluded that the changes that occurred in the medical malpractice claims after the passage and enactment of the Affordable Care Act had very little impact on the profitability of the property and casualty insurance industry. |
