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The US system for pricing and paying for cancer drugs is badly broken. The evidence is all around us-whether we focus on total spending, the breathtakingly high prices for chimeric antigen receptor T-cell therapy, the exceedingly high prices for many recently introduced drugs that offer only marginal improvements over existing treatments, or the increasing unaffordability of patient copayments. These problems are compounded by the distortions created by our payment policies, which do not take account of the value of competing treatment options and are structured in ways that distort physicians' incentives. We review the key drivers of cancer drug spending and consider the trade-offs of various policy options for addressing this problem.

In 1993, when Bill Clinton was trying to sell his health reform legislation, he excoriated pharmaceutical manufacturers for high drug prices that forced “sick and elderly Americans to skip meals to...

Many physicians and tort reform advocates believe that most medical malpractice (“med mal”) claims are “frivolous”; they often rely on reports that only about 20% of claims result in a payout. Many physicians and reform advocates also believe that plaintiffs lawyers often sue every health provider with even a remote a connection to the patient. Plaintiffs’ lawyers insist that they screen med mal cases carefully, and when they bring a claim, are selective in whom they sue. Can these perspectives be harmonized? We study this question using databases of every insured med mal claim closed in Illinois during 2000-2010 and in Indiana during 1980-2015; and semi-structured interviews with six plaintiffs’ lawyers. We innovate by using defense costs to assess whether the plaintiffs’ lawyers take a case seriously. We treat cases with under $5k in defense spending as “non-serious” cases, unless they have a payout over $25k. We find evidence that many “cases” are non-serious – they never involved filed lawsuits or if they did, the suits were soon dropped – indicating that screening is an ongoing process that does not end when a case is accepted. Observed success rates are sensitive to whether one counts “claims” (each defendant is a separate claim) or “cases” (one plaintiff versus one or more defendants), includes both pro se and represented cases, and includes all versus only serious cases. If we analyze cases instead of claims and limit to serious, represented cases, we find much higher success rates (43% in Illinois; 44% in Indiana). Success rates are higher still in cases brought solely against institutional defendants (58% in Illinois; 68% in Indiana). Plaintiffs’ lawyers are also selective in the number of defendants they sue. In med mal cases involving only physicians and/or institutions, the mean number of defendants is 1.5 in Illinois and 1.8 in Indiana. Online Appendix can be found here: http://ssrn.com/abstract=3010344.

Medical malpractice is the best studied aspect of the civil justice system. But the subject is complicated, and there are heated disputes about basic facts. For example, are premium spikes driven by factors that are internal (i.e., number of claims, payout per claim, and damage costs) or external to the system? How large (or small) is the impact of a damages cap? Do caps have a bigger impact on the number of cases that are brought or the payment in the cases that remain? Do blockbuster verdicts cause defendants to settle cases for more than they are worth? Do caps attract physicians? Do caps reduce healthcare spending—and by how much? How much does it cost to resolve the high percentage of cases in which no damages are recovered? What is the comparative impact of a cap on noneconomic damages versus a cap on total damages? Other disputes involve normative questions. Is there too much med mal litigation or not enough? Are damage caps fair? Is the real problem bad doctors or predatory lawyers—or some combination of both? This article summarizes the empirical research on the performance of the med mal system, and highlights some areas for future research.

The Medicare and Medicaid programs are not serving the needs of their target populations as well as they could. Democrats believe that Medicaid can be improved with more money and stricter federal regulation, and that Medicare can be improved by allowing it to negotiate drug prices. Republicans believe Medicaid can be improved by delegating responsibility to the states and adding work requirements, and that Medicare can be improved by moving more people into Medicare Advantage. This Article proposes a very different strategy. Instead of tinkering with these programs, both should be remodeled along the lines of Social Security, the Earned Income Tax Credit, and the Child Tax Credit. These three programs don’t try to provide housing, food, or other goods and services that beneficiaries need. Instead, they give beneficiaries money and let them sort things out for themselves. By using a similar approach for Medicare and Medicaid (i.e., by giving beneficiaries an insurance policy covering catastrophes plus money either in the form of cold hard cash or a restricted spending account), both programs would allow beneficiaries to purchase whatever goods and services they think will best promote their health and well being. The remodeled programs would also unleash the bargain-hunting skills of more than 100 million Americans, helping to drive down costs and minimize fraud.

This article, written for a symposium issue of the Texas Tech Law Review, summarizes our research on the impact of Texas’ 2003 medical malpractice (“med mal”) reform. Our central findings include: (1) there were no major changes in the frequency of med mal claims, payout per claim, total payouts, defense costs, or jury verdicts that can explain the spike in premiums for med mal liability insurance that occurred in Texas in the years before the 2003 reforms; (2) Texas’ supply of direct patient care physicians grew steadily, at similar rates, in both the pre- and post-reform periods, despite politician’s claims that physicians fled Texas before reform and flocked back thereafter; (3) although the damage caps adopted in Texas and other states greatly reduced the volume of malpractice litigation and payouts to patients, neither in Texas nor in other states have damage caps moderated the growth of health care spending; (4) the savings in liability costs generated by the Texas reforms were shared between physicians and their insurers, with the former paying lower premiums and the latter collecting more premium dollars relative to dollars paid out on claims; and (5) there is evidence that when liability rules are relaxed, hospital safety records gradually deteriorate.

How concentrated is the market for medical malpractice (med mal) legal representation? Do successful plaintiffs’ lawyers start off with better cases to begin with, do they add more value to the cases they handle, or both? How do top plaintiffs’ lawyers market their services, and where did they go to school? How large are the “wages of risk”—the compensation to plaintiffs’ lawyers for working on contingency? How often do plaintiffs proceed pro se, and with what results? We address these questions using a data set of every insured med mal case closed in Illinois during 2000–2010. We show that most plaintiffs have a lawyer. We quantify the market share, case mix, and amounts recovered by the 1,317 law firms that handled med mal cases in our sample, stratify the firms into four tiers, and assess differences across tiers. We find that the market for plaintiff-side med mal representation is both unconcentrated and highly stratified. At all firms, a small number of cases account for a heavily disproportionate share of total recoveries. We use the extensive covariates in our data to (imperfectly) address sample selection, and to estimate the effect of having a lawyer and law firm tier on outcomes. Controlling for observable claim characteristics, having a lawyer predicts a large increase in the probability of prevailing and the estimated recovery. Higher-tier firms have only modestly higher success rates, but substantially higher estimated recoveries. However, the differences shrink and are statistically insignificant when we compare first-tier to second-tier firms. This suggests that there are substantial benefits to having a lawyer—and a higher-tier lawyer—but diminishing marginal returns at the top of the market. Assuming that there is some unobserved case selection, our findings provide a plausible upper bound on the “value added” by different tiers of plaintiffs’ lawyers.

Since 1980, Illinois has experienced three medical malpractice insurance crises—in the mid-1980s, mid-1990s, and early-2000s. Each time, Illinois responded by enacting tort reform. Using a previously unavailable database of closed medical malpractice (med mal) claims, maintained by the Illinois Department of Insurance, we analyze statewide trends in med mal claiming from 1980–2010, covering all three crises. Paid claim rates rose sharply from 1980–1985, roughly leveled off from 1986–1993, and then began a sustained decline. By 2010, paid claims rates were 75 percent lower than in the peak year (1991). Payout per claim has steadily increased since 1980, but these increases can be entirely explained by the virtual disappearance of smaller paid claims and claims involving less severe injuries. The total direct cost of med mal litigation (payouts and defense costs) rose sharply from 1980–1992, with a jump in 1991, and then declined steadily, with a more modest jump during 2000–2002, which persisted through 2006. Thus, of the three Illinois insurance crises, only the first coincided in time with a major change in claiming. Rather than becoming more generous over time, the Illinois med mal system has squeezed out claimants with less severe injuries and smaller claims.

Does state tort reform affect physician supply? Tort reformers certainly believe so. Before Texas adopted tort reform in 2003, proponents claimed that physicians were deserting Texas in droves. After tort reform was enacted, proponents claimed there had been a dramatic increase in physicians moving to Texas due to the improved liability climate. We find no evidence to support either claim. Physician supply was not measurably stunted prior to reform, and it did not measurably improve after reform. This is true for all patient care physicians in Texas, high-malpractice-risk specialties, primary care physicians, and rural physicians.

The editors selected the articles for inclusion in this two-volume collection through a combination of crowd-sourcing and editorial judgment. The crowd-sourcing component involved emails to roughly 20 scholars working in health economics, health law or bioethics, asking for suggestions. The authors consolidated all of the suggestions they received, added some of their own and then held several marathon meetings to identify the articles best suited for inclusion in this collection. We hope readers will find them as interesting and provocative as we did. Volume I Part I: Access to Health Care, Mortality and Other Clinical Outcomes Individuals living without health insurance may face not only increased health risks but also elevated health care costs when inevitable medical treatment is required. Access to health care - the subject of Part I of Volume I - can have a profound impact on both the health and financial security of individuals. Yet, before the enactment of the Affordable Care Act, better known as ObamaCare, some 40 million Americans were without coverage. The exact impact of the lack of health insurance on mortality and health status as well as the health care marketplace is frequently disputed. Part I contains research discussing possible health advantages to insurance coverage and medical care access as well as the financial difficulties experienced by the uninsured.

This is the online appendix accompanying Screening Plaintiffs and Selecting Defendants in Medical Malpractice Litigation: Evidence from Illinois and Indiana, http://ssrn.com/abstract=2465092.

We identify five myths of medical malpractice that have wide currency in medical circles. The myths are as follows: (1) Malpractice crises are caused by spikes in medical malpractice litigation (ie, sudden rises in payouts and claim frequency), (2) the tort system delivers "jackpot justice," (3) physicians are one malpractice verdict away from bankruptcy, (4) physicians move to states that adopt damages caps, and (5) tort reform will lower health-care spending dramatically. We test each assertion against the available empirical evidence on the subject and conclude by identifying various nonmythical problems with the medical malpractice system.

Moral philosophers object to the ethic of zeal, also known as the fiduciary duty and the principle of partisanship, which requires a lawyer to act solely for the benefit of a client and to ignore any adverse effects that lawful actions have on third parties. For example, when representing a landlord, a lawyer may not refrain from evicting a tenant family that is behind on the rent for fear that the children will wind up on the street. Because harms inflicted on third parties normally bear on moral assessments, philosophers contend that lawyers who ignore them are amoral, immoral, or morally stunted.Although a few writers have defended the ethic of zeal, most notably the recently deceased Monroe Freedman, their efforts have enjoyed only limited success. Freedman persuaded moral philosophers to give criminal defense lawyers considerable leeway to “fight dirty,” but had little impact on their opinions of attorneys who represent clients in other contexts. Other writers have offered more limited defenses.This article offer a defense of the ethic of zeal that is grounded in the common law of agency, that encompasses all interests and applies in all contexts, and that also applies to agents who are not lawyers. The central point is that the fiduciary duty serves a moral function: it helps preserve the moral basis for attributing agents’ actions to principals by ensuring that agents act in ways that comport with principals’ consent to representation. When lawyers act disloyally, the moral basis for attribution is lost. Then, one of two things must be true. Either agents’ actions must be legal nullities, or the coercive power of the law must be applied against principals in an arbitrary manner that lacks a recognized moral justification. Critics of the ethic of zeal have neither recognized these implications nor taken account of them when encouraging lawyers to give non-clients’ interests greater weight.

The elderly account for a disproportionate share of medical spending, but little is known about how they are treated by the medical malpractice system, or how tort reform affects elderly claimants. We compare paid medical malpractice claims brought by elderly plaintiffs in Texas during 1988--2009 to those brought by adult non-elderly plaintiffs. Controlling for healthcare utilization (based on inpatient days), elderly paid claims rose from about 20% to about 40% of the adult non-elderly rate by the early 2000s. Mean and median payouts per claim also converged, although the elderly were far less likely to receive large payouts. Tort reform strongly affected claim rates and payouts for both groups, but disproportionately reduced payouts to elderly claimants. We thus find evidence of convergence between the elderly and the adult non-elderly in both claim rates and payouts, which is interrupted by tort reform. Copyright 2012, Oxford University Press.

Will tort reform “bend the cost curve?” Health-care providers and tort reform advocates insist the answer is “yes.” They claim that defensive medicine is responsible for hundreds of billions of dollars in health-care spending every year. If providers and reform advocates are right, once damages are capped and lawsuits are otherwise restricted, defensive medicine, and thus overall health-care spending, will fall substantially. We study how Medicare spending changed after Texas adopted comprehensive tort reform in 2003, including a strict damages cap. We compare Medicare spending in Texas counties with high claim rates (high risk) to spending in Texas counties with low claim rates (low risk), since tort reform should have a greater impact on physician incentives in high-risk counties. Pre-reform, Medicare spending levels and trends were similar in high- and low-risk counties. Post-reform, we find no evidence that spending levels or trends in high-risk counties declined relative to low-risk counties and some evidence of increased physician spending in high-risk counties. We also compare spending trends in Texas to national trends, and find no evidence of reduced spending in Texas post-reform, and some evidence that physician spending rose in Texas relative to control states. In sum, we find no evidence that Texas's tort reforms bent the cost curve downward.

All liability insurance policies have coverage limits, and insurers usually control whether a case is settled or tried. If the insurer rejects a within-limits settlement offer, the insured bears the risk of an above-limits verdict. In response, virtually every state has imposed a “duty to settle” on insurers, which creates incentives for plaintiffs to make at-limits offers and for insurers to accept those offers when expected damages exceed limits. We study the association between the duty to settle, settlement at limits, claim duration, and defense costs using detailed data from Texas for 1988–2005 on closed, commercially insured personal injury claims. We focus principally on medical malpractice suits against physicians, but find consistent evidence for other types of cases. We find strong evidence that the duty to settle affects settlement dynamics. Essentially, all physician-defendant cases that settle at limits are preceded by an at-limits demand. Roughly 20 percent of physician-defendant cases settle at 90–100 percent of policy limits (broad at-limits) and 13 percent settle exactly at limits (exact at-limits). Broad- and exact-at-limits cases close about five months faster than similar “below-limits” cases—a roughly 20 percent shorter time from suit to settlement, controlling for payout and type of harm. Broad- and exact-at-limits cases also have substantially lower defense costs, controlling for case duration and complexity. More broadly, as the payout/limits ratio approaches 1 from below, duration declines (controlling for payout) and defense costs decline (controlling for payout and duration). Payouts above limits are uncommon; when they occur, insurers are the primary payers. Policy limits alone cannot explain these results; most likely they reflect a combination of policy limits and the duty to settle.

In a prior article in this journal, we estimated the effect of an “O'Connell” early settlement offer program on payouts in medical malpractice litigation. Using Texas data and a base set of assumptions, we predicted that early offers would result in a 16 percent (20 percent) decline in payouts in currently tried (settled) cases. The overall decline came almost entirely from a sharp drop in payouts in cases with small economic damages. We compared our results with the estimate by Hersch, O'Connell, and Viscusi (2007) (HOV) of a 70 percent reduction in payouts, reconciled the two estimates, and explained why HOV's estimate reflected the compound effects of a series of unreasonable assumptions. In a reply in this journal, Hersch, O'Connell, and Viscusi (2010) (HOV-2) complain that we misunderstand both the early offer proposal and their analysis. Remarkably, they do not dispute our estimates, given our assumptions. In this rebuttal, we defend our assumptions and provide an alternate analysis of settled cases based on insurer allocations, which also produces an estimated 20 percent payout decline. We also develop further our proposal for two-sided early offers. This proposal would reduce the predicted payout decline by about 2 percent in both tried and settled cases. We explain in greater detail the problems with HOV's analysis. If we correct an error they made in understanding the Texas data set, and leave their other assumptions unchanged, their payout decline estimate drops to 30 percent, not far from ours.

Medical malpractice litigation is costly and time consuming. Professor Jeffrey O'Connell, with various co-authors, has long advocated “early offer” rules that would encourage defendants to offer to settle for economic damages plus attorney fees, and punish plaintiffs who refuse such offers. Using detailed closed claims data from Texas for 1988–2005, we simulate the effects of these “early offers.” Under a base set of assumptions, early offers will sharply reduce payouts in cases with small economic damages (under $100,000, all amounts in 1988 dollars); will moderately reduce payouts in currently tried cases with economic damages from $100,000–$200,000 and would normally increase payouts (and therefore will not be made) in tried (settled) cases with economic damages over $200,000 ($100,000). Overall, we predict that early offers will be made in 72 percent of all cases, and will result in a 16 percent (20 percent) decline in payouts in tried (settled) cases. Almost all this effect comes from the sharp decline in payouts in cases with small economic damages. Defense costs will drop by roughly 60 percent (20 percent) in currently tried (settled) cases in which an early offer is made, and by about 13 percent overall. An early offer program will have very different effects on different types of plaintiffs, with especially large payout reductions for elderly and deceased plaintiffs. An early offer program also overlaps substantially in its effects with a statutory cap on noneconomic damages (which 26 states already have). Defendants in many of these states have already realized large reductions in payment of noneconomic damages; the additional reductions from an early offer program are modest and would often affect plaintiffs whose recoveries were already limited by damage caps. Our mixed results contrast sharply with dramatic claims by O'Connell and co-authors, who predict 70 percent reductions in both payouts and defense costs. Their estimates reflect the compound effects of a series of unreasonable assumptions.

Using claim-level data, we estimate the effect of Texas’s 2003 cap on noneconomic damages on jury verdicts, post-verdict payouts, and settlements in medical malpractice cases closed during 1988–2004. For pro-plaintiff jury verdicts, the cap affects 47-percent of verdicts and reduces mean allowed non-economic damages, mean allowed verdict, and mean total payout by 73-percent, 38-percent, and 27-percent, respectively. In total, the non-econ cap reduces adjusted verdicts by $156M, but predicted payouts by only $60M. The impact on payouts is smaller because a substantial portion of the above-cap damage awards were not being paid to begin with. In cases settled without trial, the non-econ cap affects 18-percent of cases and reduces predicted mean total payout by 18-percent. The non-econ cap 1 We owe special thanks to Fang Zhang, Myungho Paik, and Kevin Kavanagh for their work in analyzing the data, and to Vicky Knox at the Texas Department of Insurance for patiently answering our many questions. For comments and suggestions, we thank Einer Elhauge, Meredith Kilgore, Russell Korobkin, Ed Richards, Cathy Sharkey, those who attended presentations of the paper at the Leonard Davis Institute of Health Economics at the University of Pennsylvania, Rand Institute for Civil Justice, and the Harvard, Stanford, University of Kansas and Washington University Schools of Law, and participants at the Annual Meetings of the Canadian and Midwest Law and Economics Association, and the Conference on Empirical Legal Studies. Funding for this study was provided by the Jon David and Elizabeth A. Epstein Program in Health Law and Policy at the University of Illinois College of Law and by the Center on Lawyers, Civil Justice, and the Media at the University of Texas School of Law. The working paper version of this article is available at http://ssrn.com/abstract=995649. 2 Hyman is Richard W. and Marie L. Corman Professor of Law and Professor of Medicine, University of Illinois. Tel. 217-333-0061, email: dhyman@law.uiuc.edu. Hyman is the corresponding author. Black is Hayden W. Head Regents Chair for Faculty Excellence, University of Texas Law School, and Professor of Finance, University of Texas, Red McCombs School of Business. Tel. 512-471-4632, email: bblack@law.utexas.edu. Silver is McDonald Endowed Chair in Civil Procedure, University of Texas Law School. Tel. 512-232-1337, email: csilver@law.utexas.edu. Sage is James R. Dougherty Chair for Faculty Excellence in Law, University of Texas School of Law, and Vice-Provost for Health Affairs, University of Texas at Austin. Tel. 512-232-7806, email: wsage@law.utexas.edu. 356 ~ Hyman, Black, Silver, Sage: Estimating the Effect of Damages Caps in Medical Malpractice Cases has a smaller impact on settled cases than tried cases because settled cases tend to involve smaller payouts. The impact of the non-econ cap varies across plaintiff categories. Deceased, unemployed, and (likely) elderly plaintiffs suffer a larger percentage reduction in payouts than living, employed, and non-elderly plaintiffs. We also simulate the effects of different caps and fi nd substantial differences in cap stringency across states. Different caps reduce aggregate payouts in tried cases (all cases) by between 16-percent and 65-percent (7-percent and 42-percent). Caps on total damages have especially large effects.

We study defense costs for commercially insured personal injury tort claims in Texas over 1988--2004, and insurer reserves for those costs. We rely on detailed case-level data on defense legal fees and expenses, and Texas state bar data on lawyers' hourly rates. We study medical malpractice ("med mal") cases in detail, and other types of cases in less detail. Controlling for payouts, real defense costs in med mal cases rise by 4.6 percent per year, roughly doubling over this period. The rate of increase is similar for legal fees and for other expenses. Real hourly rates for personal injury defense counsel are flat. Defense costs in med mal cases correlate strongly with payouts, both in ordinary least squares (OLS) and in an instrumental variable analysis. They also correlate with the stage at which a case is resolved, and case duration. Mean duration declined over time. Med mal insurers predominantly use outside counsel. Case-level variation in initial expense reserves predicts a small fraction of actual defense costs. In other areas of tort litigation (auto, general commercial, multi-peril, and other professional liability), defense costs rose by 2.2 percent per year. Defense costs in these cases are predicted by the same factors as in med mal cases, plus the presence of multiple defendants.Insurer reserving practices raise some puzzles. Med mal insurers did not react to the sustained rise in defense costs by adjusting their expense reserves, either in real dollars or relative to reserves for payouts. Thus, expense reserves declined substantially relative to defense costs. In other litigation areas, expense reserves rose along with defense costs. Copyright 2008, Oxford University Press.

Using medical malpractice claims with payments of $25,000 or more that closed in Texas from 1990 to 2003, this study quantifies physicians' insurance limits and examines the connection between policy size and payments on claims. It finds that most physicians had less than $1 million (nominal) in coverage, that real policy size declined, that settlements at the policy limits were common, that payment size was stable or falling, and that payments above the policy limits were rare. It also finds that physicians rarely made out-of-pocket payments, suggesting the policy limits often cap recoveries, and that the frequency of out-of-pocket payments declined as policy size increased. Results are presented separately for “perinatal physicians.”The Geneva Papers (2008) 33, 177–192. doi:10.1057/gpp.2008.3

Physicians’ insuring practices influence their incentives to take care when treating patients, their risk of making out‐of‐pocket payments in malpractice cases, and the adequacy of compensation available to injured patients. Yet these practices and their effects have rarely been studied. Using Texas Department of Insurance data on 9,525 paid malpractice claims against physicians that closed in 1990–2003, we provide the first systematic evidence on levels of coverage purchased by physicians with paid liability claims and how those levels affect out‐of‐pocket payments and patient compensation. We find that these physicians carried much less insurance than is conventionally believed, that their real primary limits declined steadily over time, that policy limits often act as effective caps on recovery, and that personal contributions by physicians to close claims were rare. Our findings call into question a number of common assumptions about the relationship between physicians' insuring practices and...

Legal scholars, legislators, policy advocates, and the news media frequently use jury verdicts to draw conclusions about the performance of the tort system. However, actual payouts can differ greatly from verdicts. We report evidence on post-verdict payouts from the most comprehensive longitudinal study of matched jury verdicts and payouts. Using data on all insured medical malpractice claims in Texas from 1988–2003 in which the plaintiff received at least $25,000 (in 1988 dollars) following a jury trial, we find that most jury awards received “haircuts.” Seventy-five percent of plaintiffs received a payout less than the adjusted verdict (jury verdict plus prejudgment and postjudgment interest), 20 percent received the adjusted verdict (within ± 2 percent), and 5 percent received more than the adjusted verdict. Overall, plaintiffs received a mean (median) per-case haircut of 29 percent (19 percent), and an aggregate haircut of 56 percent, relative to the adjusted verdict. The larger the verdict, the more likely and larger the haircut. For cases with a positive adjusted verdict under $100,000, 47 percent of plaintiffs received a haircut, with a mean (median) per-case haircut of 8 percent (2 percent). For cases with an adjusted verdict larger than $2.5 million, 98 percent of plaintiffs received a haircut with a mean (median) per-case haircut of 56 percent (61 percent). Insurance policy limits are the most important factor in explaining haircuts. Caps on damages in death cases and caps on punitive damages are also important, but defendants often paid substantially less than the adjusted allowed verdict. Remittitur accounts for a small percentage of the haircuts. Punitive damage awards have only a small effect on payouts. Out-of-pocket payments by physicians are rare, never large, and usually unrelated to punitive damage awards. Most cases settle, presumably in the shadow of the outcome if the case were to be tried. That outcome is not the jury award, but the actual post-verdict payout. Because defendants rarely pay what juries award, jury verdicts alone do not provide a sufficient basis for claims about the performance of the tort system.

Background Rare cell subtypes can profoundly impact the course of human health and disease, yet their presence within a sample is often missed with bulk molecular analysis. Single-cell analysis tools such as FACS, FISH-FC and single-cell barcode-based sequencing can investigate cellular heterogeneity; however, they have significant limitations that impede their ability to identify and transcriptionally characterize many rare cell subpopulations. Results PCR-activated cell sorting (PACS) is a novel cytometry method that uses single-cell TaqMan PCR reactions performed in microfluidic droplets to identify and isolate cell subtypes with high-throughput. Here, we extend this method and demonstrate that PACS enables high-dimensional molecular profiling on TaqMan-targeted cells. Using a random priming RNA-Seq strategy, we obtained high-fidelity transcriptome measurements following PACS sorting of prostate cancer cells from a heterogeneous population. The sequencing data revealed prostate cancer gene expression profiles that were obscured in the unsorted populations. Single-cell expression analysis with PACS was subsequently used to confirm a number of the differentially expressed genes identified with RNA sequencing. Conclusions PACS requires minimal sample processing, uses readily available TaqMan assays and can isolate cell subtypes with high sensitivity. We have now validated a method for performing next-generation sequencing on mRNA obtained from PACS isolated cells. This capability makes PACS well suited for transcriptional profiling of rare cells from complex populations to obtain maximal biological insight into cell states and behaviors. Electronic supplementary material The online version of this article (doi:10.1186/s12864-016-2694-2) contains supplementary material, which is available to authorized users.

In 2011, an enormous outcry ensued when the law firm of King & Spalding (K&S) abandoned the Republican leaders of the House of Representatives in U.S. v. Windsor, the case in which the Defense of Marriage Act (DOMA) was struck down. Paul Clement, the star litigator in charge of the case, resigned from the firm and published a letter accusing it of caving in under pressure from gay rights groups, which organized a campaign to convince the firm to withdraw. A chorus that included law professors, government lawyers, editorial boards, pundits, the incumbent Attorney General, and a sitting Supreme Court Justice joined him in condemning K&S. Even though many of these speakers opposed DOMA — and the Attorney General had refused to defend the statute in-house — they praised Clement for standing by the Bipartisan Legal Advisory Group (BLAG) heroically and accused the LGBT community of bad behavior. By attacking K&S, they argued, gay rights groups had undermined the civil justice system, which depends on zealous advocacy for all sides. These groups were also said to have endangered vulnerable clients by legitimating the use of a tactic that would make it harder for them to find lawyers. Clement had bravely set an example for all lawyers by steadfastly supporting a client under siege. This Article argues that both the criticisms heaped upon K&S and the LGBT community and the praise lavished upon Clement were mostly unwarranted. Clement was not shown to be a hero, that is, a person who bravely incurs a serious risk of personal loss for the benefit of another. K&S’s action was proper because it withdrew without harming BLAG, because it had no duty to remain engaged, and because it was a poor fit with BLAG. The firm can legitimately be criticized for having allowed Clement to jump the gun by signing the contract to represent the House of Representatives before the firm’s new matter review process was completed. And having done that, the firm can also be criticized for allowing business concerns that were known or predictable in advance to influence its decision to withdraw. But in volume and intensity, the condemnations that were heaped upon K&S were excessive. Finally, the actions of the gay rights organizations threatened neither to undermine the civil justice system nor to make legal services harder for vulnerable clients to obtain. The fact that K&S was engaged by a client to handle a litigation matter afforded no reason for gay rights advocates to refrain from holding the firm accountable for its engagement to BLAG. This Article does not criticize Clement for remaining loyal to BLAG. It does contend that his did something ordinary, not something heroic.

A new and manufacturable miniature electron beam column has been designed, fabricated and tested. The low-voltage, all electrostatic, microfabricated electron beam column includes lenses consisting of bonded stacks of micro-machined silicon and glass. The lenses are microfabricated on 150mm diameter substrates using semiconductor and bulk micro-machining fabrication processes. These processes are capable of fabricating columns with precise aperture diameters, and repeatable alignment tolerances. They also enable new designs that significantly increase the voltages at which miniature columns can reliably operate. The lenses are assembled onto a ceramic package using pick-and-place production tools. The package is fabricated using technologies that allow interconnects to be strategically distributed and encapsulated using high-resolution pattern transfer and enable fabricating small packages with high density routing and easy integration of buried and external passive and active devices, ground planes, and controlled impedance lines. Beam characterization of the column has begun and optimization continues. Preliminary spot size and resolution are presented.

Since 1980, Illinois has experienced three med mal insurance crises – in the mid-1980s, mid-1990s, and early-2000s. Each time, Illinois responded by enacting tort reform. Using a previously unavailable database of closed medical malpractice (“med mal”) claims, maintained by the Illinois Department of Insurance, we analyze statewide trends in med mal claiming from 1980-2010, covering all three crises. Paid claim rates rose sharply from 1980-1985, roughly leveled off from 1986-1993, and then began a sustained decline. By 2010, paid claims rates were 75% lower than in the peak year (1991). Payout per claim has steadily increased since 1980, but these increases can be entirely explained by the virtual disappearance of smaller paid claims and claims involving less severe injuries. The total direct cost of med mal litigation (payouts and defense costs) rose sharply from 1980-1992, with a jump in 1991 and then declined steadily, with a more modest jump during 2000-2002, which persists through 2006. Thus, of the three Illinois insurance crises, only the first coincided in time with a major change in claiming. Rather than becoming more generous over time, Illinois’ med mal system has squeezed out claimants with less severe injuries and smaller claims.

Having studied insurance defense arrangements for years, I was mystified by the strenuous opposition mounted in certain quarters to third party litigation funding. For it seemed to me that liability insurance, which ordinarily requires insurers to bear both the cost of defending claims and the burden of paying them, is subject to every complaint lodged against third party funding. Both encourage lawsuits, influence settlements terms, have payers intermeddling in litigation, etc. Yet, in the United States, insurers have covered litigation risks for over a century, and no one proposes getting rid of them. To the contrary, some writers, including me, worry that certain actors have too little insurance and should perhaps be required to purchase more. Yet, if liability insurance and third party funding are objectionable on the same grounds, why should one want more of one and less of the other? In this Essay, I will make good on the claim that the major objections to third party funding have analogues applicable to liability coverage. I will also explain why the analogues have not led us to prohibit carriers from selling insurance, and why third party funding should survive them as well. When carrying out this project, I will focus on contracts between funders and claimants, rather than between funders and lawyers. The former resemble liability insurance arrangements more nearly than the latter, which are substitutes for accumulated wealth, bank loans, and other sources lawyers have traditionally used to finance cases.

Will tort reform “bend the cost curve?” Health-care providers and tort reform advocates insist the answer is “yes.” They claim that defensive medicine is responsible for hundreds of billions of dollars in health-care spending every year. If providers and reform advocates are right, once damages are capped and lawsuits are otherwise restricted, defensive medicine, and thus overall health-care spending, will fall substantially. We study how Medicare spending changed after Texas adopted comprehensive tort reform in 2003, including a strict damages cap. We compare Medicare spending in Texas counties with high claim rates (high risk) to spending in Texas counties with low claim rates (low risk), since tort reform should have a greater impact on physician incentives in high-risk counties. Pre-reform, Medicare spending levels and trends were similar in high- and low-risk counties. Post-reform, we find no evidence that spending levels or trends in high-risk counties declined relative to low-risk counties and some evidence of increased physician spending in high-risk counties. We also compare spending trends in Texas to national trends, and find no evidence of reduced spending in Texas post-reform, and some evidence that physician spending rose in Texas relative to control states. In sum, we find no evidence that Texas’s tort reforms bent the cost curve downward.

Contingency fees are a matter of intense public concern, but little is known about the economics of plaintiff-side personal injury litigation. We obtained data on payouts, fees, and expenses for all cases settled over an extended period by three plaintiff-side personal injury firms, one in Texas, one in Illinois, and one in a state we cannot disclose. We study the economics of plaintiff-side personal injury litigation, and estimate the effects of statutory caps on contingency fees. Fees vary from 0% to 34%, but the modal fee is one-third of the recovery. A one-third fee is not uniformly collected ex post even when it is explicitly contracted for ex ante: when recoveries are low, plaintiffs’ attorneys often reduce or waive their fee. Mean per-case litigation-related expenses were 5.1% (Il firm) and 5.6% (Tx firm). In prior work with Texas data, we found that defense-side fees and expenses increased over time. Although expenses increased at all three firms over time, fees as a percentage of recoveries decreased modestly at the Texas firm, and were stable at the Illinois firm. Analysis continues on the expenses and fees at the 3rd firm. At all three firms, an overwhelming percentage of total fees comes from a small number of cases. The top 10% (1%) of cases are responsible for 67% (23%) of total fees for the Illinois firm; 82% (55%) of total fees for the Texas firm; 43.5% (15%) for 3rd firm cases handled internally, and 67% (30%) of 3rd firm cases referred elsewhere. Cases with modest fees may help to keep the lights on, but the blockbuster cases are what keep plaintiffs’ attorneys in this line of work. Statutory restrictions on contingency fees vary in severity, but have the potential to significantly change the economics of plaintiff-side representation.

Given the reputation of economics as the dismal science, it is pleasant to report on two upbeat books that draw on public choice theory-the economic study of nonmarket decision making-for insights relating to law. Not that these books lack for jaundice. They amply reveal the authors' belief that, in the crush of interest group politics, the public interest often is ignored. But the jaundice notwithstanding, both books have a positive thrust. Both contend that democratic lawmaking institutions can serve the public interest, that frequently they do, and that federal judges can help ensure that result. Given that some public choice theorists question the very possibility of defining the public interest in a coherent and defensible way, these are remarkable claims. The authors' willingness to make them shows that lawyerly faith in democracy and law can survive extended exposure to public choice theory. Not every law professor who reads the public choice literature is jaded by the experience. Some find their faith in democracy renewed. Daniel A. Farber and Philip P. Frickey sound upbeat notes throughout Law and Public Choice: A Critical Introduction.' They begin this survey

All insurance has coverage limits, and insurers usually control whether a case is settled or tried. If the insurer rejects a within-limits settlement offer, the insured bears the risk of an above-limits verdict. In response, virtually every state has imposed a “duty to settle” on insurers, which creates incentives for plaintiffs to make at-limits offers and for insurers to accept those offers when expected damages exceed limits. We study the association between the duty to settle, settlement at limits, claim duration, and defense costs using detailed data from Texas for 1988-2005 on closed, commercially insured personal injury claims. We focus principally on medical malpractice suits against physicians, but find consistent evidence for other types of cases. We find strong evidence that the duty to settle affects settlement dynamics. Essentially all physician-defendant cases that settle at-limits are preceded by an at-limits demand. Roughly 20% of physician-defendant cases settle at 90-100% of policy limits (“broad at-limits”) and 13% settle exactly at limits (“exact at-limits”). Broad- and exact-at-limits cases close about five months faster than similar “below-limits” cases -- a roughly 20% shorter time from suit to settlement, controlling for payout and type of harm. Broad- and exact-at-limits cases also have substantially lower defense costs, controlling for case duration and complexity. More broadly, as the payout/limits ratio approaches 1 from below, duration declines (controlling for payout) and defense costs decline (controlling for payout and duration). Payouts above-limits are uncommon; when they occur, insurers are the primary payers. Policy limits alone cannot explain these results; most likely reflect a combination of policy limits and the duty to settle.

This article uses three recent multi-district litigations (MDLs) that produced massive settlements - Guidant ($240 million), Vioxx ($4.85 billion), and Zyprexa ($700 million) - to study the emerging quasi-class action approach to MDL management. The approach has four components: (1) judicial selection of lead attorneys; (2) judicial control of lead attorneys' compensation; (3) forced fee transfers from non-lead lawyers to cover lead attorneys' fees; and (4) judicial reduction of non-lead lawyers' fees to save claimants money. These widely used procedures have serious downsides. They make lawyers financially dependent on judges and, therefore, loyal to judges rather than clients. They compromise judges' independence by involving them heavily on the plaintiffs' side and making them responsible for plaintiffs' success. They allocate monies in ways that likely over-compensate some attorneys and under-pay others, with predictable impacts on service levels. They also lack needed grounding in substantive law because the common fund doctrine, which supports fee awards in class actions, does not apply in MDLs. Academics have not previously noted these shortcomings; this is the first scholarly assessment of the quasi-class action approach.This article also proposes an alternative method of MDL management. It recommends the creation a plaintiffs' management committee (PMC) composed of the attorney or attorney-group with the most valuable client inventory, as determined objectively by the trial judge. The PMC, which would have a large interest in the success of an MDL, would then select and retain other lawyers to perform common benefit work (CBW) for all claimants and monitor the lawyers' performance. The new approach would thus use micro-incentives to organize the production of CBW in MDLs rather than judicial control and oversight. The court would stand back from the process, exercising only a limited backup authority to prevent abuses. If enacted as a statute, the proposal would restore judges' independence, preserve lawyers' loyalties, provide the requisite legal foundation for fee awards, and encourage the fairer, more efficient, and more appropriate representation of claimants in MDLs.

By enacting the Private Securities Litigation Reform Act of 1995 (PSLRA), Congress sought to put institutional investors in charges of securities class actions. In an important respect, this effort has failed. Although pension funds for public sector employees and labor unions often volunteer to serve as lead plaintiffs, private institutional investors do not. The participation of public sector and union funds may also reflect political contributions and ideological beliefs, rather than the PSLRA. The passivity of private sector funds and the importance of ideology and political contributions as motivations for public sector and union funds reflects the incentives created by the PSLRA, which prohibits bonus payments for lead plaintiffs and encourages investors to free-ride. This Article sets out three possible amendments to the PSLRA designed to give investors of all types selective incentives to serve as lead plaintiffs. One would give lead plaintiffs bonuses tied to the size of their holdings. The second proposal would sell 20% of the class-wide recovery to the class member willing to pay the most for it, while also requiring the lead plaintiff to pay half the class' attorneys' fees from this portion. The third proposal would auction off 30% of the recovery, while requiring the lead plaintiff to pay 100% of the class' attorneys' fees. The second and third proposals would encourage lead plaintiffs to set class counsel's fees at efficient rates.

The belief that malpractice lawsuits impede efforts to improve health care quality by encouraging providers to hide mistakes is the conventional wisdom among patient safety advocates and scholars. It also provides the normative basis for efforts currently proceeding at the state and federal levels to curtail medical malpractice exposure. Groups pressing for tort reform, including the American Medical Association, contend that when doctors and other providers are insulated from liability, patients will be better protected from harm. This article canvasses the evidence bearing on the connection between malpractice exposure and health care quality. Some of this evidence, such as the Harvard Medical Practice Study, shows that the quality of health care improves as the risk of being sued rises; none of it shows that malpractice lawsuits cause the quality of health care to decline. The widely held belief that fear of malpractice liability impedes efforts to improve the reliability of health care delivery systems is unfounded. The central causes of the high error rates that persist in the health care sector appear to be providers' defective incentives and professional norms. Providers lose money when quality improves, and their norms discourage the creation of non-punitive working environments in which efforts to improve quality can flourish. The business case for quality is missing, and providers' attitudes are antithetical to quality improvement. The tort system's major deficiency is its failure to subject providers to sufficient economic pressure to overcome these impediments. The cause of this shortcoming is the rarity with which injured patients assert legal claims.

Using a comprehensive database of closed claims maintained by the Texas Department of Insurance since 1988, this study provides evidence on a range of issues involving medical malpractice litigation, including claim frequency, payout amounts, defense costs, and jury verdicts. The data present a picture of stability in most aspects and moderate change in others. We do not find evidence in claim outcomes of the medical malpractice insurance crisis that produced headlines over the last several years and led to legal reform in Texas and other states. Controlling for population growth, the number of large paid claims (over $25,000 in real 1988 dollars) was roughly constant from 1990-2002. The number of smaller paid claims declined. Controlling for inflation, payout per large paid claim increased over 1988-2002 by an estimated 0.1 percent insignificant) -0.5 percent (marginally significant) per year, depending on the data set, but actual payouts in tried cases showed little or no time trend. Real defense costs per large paid claim rose by 4.2-4.5 percent per year. Real total cost per large paid claim, including defense costs, rose by 0.8-1.2 percent per year. The prior working paper version of this paper is available at http://ssrn.com/abstract=678601. The working paper version contains color figures, which were converted to black and white in the published version.