Of course, that’s how insurance works. My point was there is no calculating needed. You know the risk for each doctor by their malpractice premium.
Every insurer will tell you they calculate all the probabilities and charge you the appropriate premium.
But we all know they just recoup losses next year. There’s no actuarial math going into it.
Going back to the original comment, your not wrong that hospitals are thinking about malpractice in cost (or should be) my point was that it should be fairly measurable in the base case and tail cases should be few and covered by other riders or self insurance.