Liability Rule Allocation And Control Of Medical Expert System Risk

Abstract

New techno logy a n d f i p p l i c a t i o n s b o t h d e l i v e r b e n e f i t s and in t rod l i ce r i s k s . Common law l i a b i l i t v r u l e s express s o c i a l responses t o r i s k . They do so through genera l standards and p a r t i c u l a r r u l e s o f i n c l u s i o n and e x c l u s i o n t h a t d e f i n e r i s k a l l o c a t i o n and, more p a r t i c u l a r l y , whether a p a r t i c u l a r i n j u r y i s o r i s n o t compensable. The paper cons iders what r u l e s a r e l i k e l y t o app lv i n d e a l i n g w i t h medical i n f o r m a t i o n technology, and e s p e c i a l l y medical exper t system, r i s k events. Introduction and Overview Fast-paced in i 'ormat ion techno loqy developments p resent i n c r e a s i n g o p p o r t u n i t i e s t o enhance h e a l t h care management and d e l i v e r y systems. That promises e x t r a o r d i n a r y ga ins f o r h e a l t h ca re r e c i p i e n t s , b u t exper ience cau t ions t h a t new r i s k s may a t t e n d promis ing a p p l i c a t i o n s o f b e n e f i c i a l techno log ies . Absent i n t e r v e n t i o n , t h e market and l e g a l l y en forceab le c c n t r a c t s d i r e c t inves tment i n r i s k r e d u c t i o n as w e l l a!; i n o t h e r techno logy re la ted a c t i v i t i e s . That, 'in theory, produces an op t ima l a l l o c a t i o n o f resources t o research , development, p roduc t i on and assoc ia ted a c c i d e n t c o s t reduc t i on . Real w o r l d c o n d i t i o n s , however, do n o t always comport w i t h fac tua ' assumptions o f marke t theory . An impor tan t consequence i s t h a t t h e marke t o f ten under inves ts i n t h e c o n t r o l o f r i s k . The s o c i a l response i n t h a t c i rcumstance i s i n t e r v e n t i o n th rough r e g u l a t i o n and r i s k-a11 oca t i rrg l i a b i l i t y r u l e s . Soc ia l i n t e r v e n t i o n spans a broad spectrum. A t one extreme, i t i s e x e m p l i f i e d by marke t -o r i en ted r u l e s t h a t compel d i s c l o s u r e of i n f o r m a t i o n c r i t i c a ' t o t h e e x e r c i s e o f r a t i o n a l choice. A t t h e o t h e r po le , i t man i fes ts as c l a s s i c s tandard -se t t i ng corimand and c o n t r o l r e g u l a t i o n t h a t s u b s t i t u t e s p u b l i c f o r p r i v a t e cho ice . Both s t r a t e g i e s , and in te rmed ia te a l t e r n a t i v e s , f i n d express ion i n t h e o the rw ise q u i t e d i f f e r e n t common law a d j u d i c a t i o n and p u b l i c r e g u l a t i o n . Regulation and Liability Rules A1 t e r n a t i v e s and Coripl iments o r i c i i n and DersDect-ve. Requ la t i on o r i q i n a t e s i n a Regu la t i on and l i a b i l i t y r u l e s d i f f e r i n bo th pro;pective' pub1 i c p o l icymaking process t h a t addresses a d e f i n e d phenomenon. L i a b i l i t y r u l e s , i n con t ras t , evo l ve th rough r e a c t i v e , case-by-case r e s o l u t i o n o f p r i v a t e d i spu tes bases i n d i s c r e t e events. Cor re la t i ve ' i y , r e g u l a t i o n s a r e comprehensive and opera te ex an te w h i l e l i a b i l i t y r u l e s develop i n c r e m e n t a l l y and f . i x r i s k ex pos t . s i m i l a r i t i e s . Once announced, l i a b i l i t y r u l e s , l i k e r e g u l a t i o n s , serve i i prospec t i ve f u n c t i o n . w h i l e n o t enshr ined i n coriprehensive fo rmal statements, a r t i c u l a t e d p r i n c i p l e s and t h e i r inc rementa l re f inements gu ide f u t u r e behav io r . Those d i f f e r e n c e s , hJwever, mask impor tan t Most s i g n i f i c a n t i s t h a t n e i t h e r mode u n r e a l i s t i c a l l y assumes t h a t se rv i ces o r p roduc ts can be r i s k f ree . Re la ted t h e r e t o , bo th e x p l i c i t l y o r i m p l i c i t l y ba lance sometimes competing s o c i a l goa ls o f m i n i m i z i n q r i s k o f harm and encouraginq s c i e n t i f i c and t e c h n o l o g i c a l progress. A t h i r d s i m i l a r i t y i s t h a t r e g u l a t i o n and l i a b i l i t y r u l e s f r e q u e n t l y employ q u i t e s i m i l a r means i n t h e s o c i a l c o n t r o l o f r i s k . The c l e a r e s t example o f common means i s compulsory d i s c l o s u r e of r i s k i n fo rma t ion . Required d i s c l o s u r e i s t h e l e a s t i n t r u s i v e fo rm o f i n t e r v e n t i o n . I t u s u a l l y serves t h e l i m i t e d o b j e c t i v e o f c o r r e c t i n g a market i m p e r f e c t i o n t h a t r e s u l t s i n an undersupply o f data e s s e n t i a l t o t h e e x e r c i s e o f s e l f p r o t e c t i n g in fo rmed cho ice . The more f a m i l i a r pe rcep t ion o f bo th r e g u l a t i o n and l i a b i l i t y r u l e s i s t h a t o f p roduc t o r conduct s tandard -se t t i ng . The modes o f express ion i n t h i s area, however, a r e q u i t e d i f f e r e n t . Common law l i a b i l i t y r u l e s speak i n general r u l e s o f neql igence, s t r i c t l i a b i l i t y and du ty t o warn w h i l e r e g u l a t i o n s address d e f i n e d circumstances i n more p a r t i c u l a r p r e s c r i p t i v e and p r o s c r i p t i v e terms. Impor tan t D i f f e r e n c e s That d i f f e r e n c e r e f l e c t s t h a t p u b l i c r e g u l a t i o n and p r i v a t e a d j u d i c i a t i o n a r e fundamenta l l y d i f f e r e n t i n t h e i r processes o f f o r m u l a t i n g and t h e i r means of implement ing p o l i c y choices. As observed above, ru lemak ing by r e g u l a t i o n i s synop t i c and p rospec t i ve w h i l e common law l i a b i l i t y r u l e f o r m u l a t i o n i s inc rementa l and post. A r e l a t e d d i f f e r e n c e i s t h a t l i a b i l i t y r u l e s a r e a p p l i e d i n a manner t h a t has economic consequences. Judgments f o r -and a g a i n s t -i n j u r e d p l a i n t i f f s serve impor tan t f u n c t i o n s t h a t a re more d i f f i c u l t f o r r e g u l a t i o n t o per fo rm. A de te rm ina t ion o f l i a b i l i t y s p e c i f i e s and q u a n t i f i e s r i s k f a c t o r s f o r o the rs , n o t j u s t those h e l d l i a b l e i n t h e p a r t i c u l a r case. i n d i c a t e t h e l i m i t s o f r i s k exposure. decided o r s e t t l e d cases impor tan t da ta i n de te rm in ing a p p r o p r i a t e l e v e l s o f investment i n i n j u r y p reven t ion and insurance p r o t e c t i o n . i t s magnitude, b u t i t i d e n t i f i e s and addresses r i s k s p r o s p e c t i v e l y . I t n e c e s s a r i l y proceeds from s t a t e d assumptions and imper fec t knowledge. Fu r the r , i t opera tes w i t h i n bounds d e f i n e d by an agency's s t a t u t o r y a u t h o r i t y . I n c o n t r a s t . l i a b i l i t y r u l e s evo lve i n response t o events and t h e i r a p p l i c a t i o n de f i nes r i s k exposure i n an e x c l u s i v e as we'l l as ari i n c l u s i v e manner under b road ly r a t h e r than v e r t i c a l l y a p p l i c a b l e standards. Dec is ions t h a t deny l i a b i l i t y That makes The r e g u l a t o r y process a l s o assesscs r i s k ancl