Does Your Reputation Precede You? The Role of Malpractice History in the Demand for Specialist Physicians

Do patients or their doctors care about a specialist’s malpractice history? I answer this question by estimating a discrete choice model of demand for knee and hip replacement surgeons in Florida. I find that physicians experience a statistically significant, but economically modest, loss of demand from having a history of being sued. A sued physician is 0.256 percentage points less likely to be chosen to perform a knee or hip replacement surgery. However, the biggest drop in demand occurs after one suit, the effect persists over time, and patients do not care whether the specialist successfully defends her lawsuits.

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