Cost and compensation of injuries in medical malpractice.

The primary functions of the tort system in resolving medical malpractice claims are to deter injuries and to compensate victims.' One reason for the high overhead of the tort system is the separation of liability and loss determinations. Calculations of damages are expected to follow general rules. 2 All injury classification schemes yield categories with some intracategory variation in actual loss. The advantage of individualized loss determinations is their presumed elimination of such heterogeneity. Individualized estimates also have potential disadvantages. The rules controlling awards for damages must be sufficiently general to cover a broad spectrum of situations. This necessity, coupled with the fact that numerous assumptions underlie almost any calculation of loss, allows attorneys and expert witnesses considerable discretion to cast the loss in the most favorable light for their clients-high losses for plaintiffs and low losses for defendants. The tort system implicitly expects that the settlement process and the jury system can avoid overand underestimates of loss. This faith, however, has not been documented empirically. Courts have no memory of awards paid for damages in similar cases; 3 they maintain no data banks on past awards. Such data are available from jury