Background We sought to characterise the frequency, health outcomes and economic consequences of diagnostic errors in the USA through analysis of closed, paid malpractice claims.

Methods We analysed diagnosis-related claims from the National Practitioner Data Bank (1986–2010). We describe error type, outcome severity and payments (in 2011 US dollars), comparing diagnostic errors to other malpractice allegation groups and inpatient to outpatient within diagnostic errors.

Results We analysed 350 706 paid claims. Diagnostic errors (n=100 249) were the leading type (28.6%) and accounted for the highest proportion of total payments (35.2%). The most frequent outcomes were death, significant permanent injury, major permanent injury and minor permanent injury. Diagnostic errors more often resulted in death than other allegation groups (40.9% vs 23.9%, p<0.001) and were the leading cause of claims-associated death and disability. More diagnostic error claims were outpatient than inpatient (68.8% vs 31.2%, p<0.001), but inpatient diagnostic errors were more likely to be lethal (48.4% vs 36.9%, p<0.001). The inflation-adjusted, 25-year sum of diagnosis-related payments was US$38.8 billion (mean per-claim payout US$386 849; median US$213 250; IQR US$74 545–484 500). Per-claim payments for permanent, serious morbidity that was ‘quadriplegic, brain damage, lifelong care’ (4.5%; mean US$808 591; median US$564 300), ‘major’ (13.3%; mean US$568 599; median US$355 350), or ‘significant’ (16.9%; mean US$419 711; median US$269 255) exceeded those where the outcome was death (40.9%; mean US$390 186; median US$251 745).

Conclusions Among malpractice claims, diagnostic errors appear to be the most common, most costly and most dangerous of medical mistakes. We found roughly equal numbers of lethal and non-lethal errors in our analysis, suggesting that the public health burden of diagnostic errors could be twice that previously estimated. Healthcare stakeholders should consider diagnostic safety a critical health policy issue.