Malpractice costs in 2026: 6 things to know

The legal and financial environment surrounding malpractice premiums and lawsuits has intensified as awards of more than $10 million become increasingly commonplace in healthcare.

Here are six things to know about the malpractice environment across the U.S. in 2026: 

1. According to ranking and surveys from WalletHub, Medscape and Marit Health, several states offer more “favorable” malpractice regulations and costs for physicians. These states include: Montana, Indiana, Iowa, Wyoming, Wisconsin, New Hampshire, South Dakota, North Dakota and Mississippi. 

2. Juries are increasingly awarding “nuclear verdicts,” or those surpassing $10 million, in medical malpractice lawsuits, according to the American Medical Association. The average amount of the top 50 medical malpractice verdicts has significantly increased in recent years, the AMA said in a Jan. 2 article on its website. In 2022, that average was $32 million. The next year saw $48 million, and the average was $56 million in 2024. 

3. Malpractice costs are also being driven by what the AMA describes as social inflation, which is being caused by: 

• Loss in public trust of healthcare systems after COVID-19
• Increased corporate consolidation of healthcare facilities
• Shifts in jury perspectives. Interviews with jurors have shown that they are interested in compensating plaintiffs even if there has been no negligence, according to the AMA.
• Large numbers losing significance. Because the sums of malpractice awards have increased, jurors are desensitized to the gravity of $10, $20 or even $100 million. 

4. The “reptile theory,” which is based on an appeal to the jury’s deep-seated survival tactics, is partially to blame for increased malpractice awards, according to the AMA. Plaintiffs utilizing the reptile theory do not just argue as to how a physician may have failed to meet the standard of care for a particular patient, but how such performance might put others in danger. 

5. Thirty-two percent of physicians said their malpractice premiums increased in 2024, according to Medical Economics‘ 96th Physician Report, published Dec. 29.

Here’s a breakdown of surveyed physicians’ estimated malpractice premiums in 2024:

• Less than $5,000: 7%
• $5,000 – $9,999: 16%
• $10,000 – $19,999: 29%
• $20,000 – $29,999: 7%
• $30,000 – $39,999: 6%
• $40,000 – $49,999: 7%
• $50,000 or more: 4%
• I don’t know: 30%

6. Between 2015 and 2025, there have been a total of 608,758 adverse action reports filed across the country, according to data from the the National Practitioner Databank, which includes reports through September 2025. 

Here are the 10 states with the most adverse action reports in that period:

1. California: 60,385
2. Texas: 52,660
3. Florida: 40,519
4. Ohio: 28,850
5. New York: 26,485
6. Michigan: 24,996
7. Pennsylvania: 24,291
8. Illinois: 20,020
9. Colorado: 18,665
10. Washington: 17,748