direct costs of malpractice

At first glance, the difference between B and C appears to be the difference between PRESENT TENSE and PAST TENSE ("amounts" v. "amounted").

One hint is that we're talking about the amount spent LAST YEAR, so past tense makes more sense. However, it's sometimes acceptable to use the present tense when talking about something that happened in the past that's still relevant in the present. For example: the birthday present that I received last month is lovely. I received the gift in the past, but it's still lovely in the present. (I'd argue that this isn't exactly what's happening in your example sentence, but still - there may have been some legitimate confusion about past v. present).

However - we need to make sure subject-verb agreement is always intact. The subject of our sentence is COSTS. We cannot say "the direct COSTS AMOUNTS..." but we can say "the direct COSTS AMOUNTED..."

The answer must be C.

Source: GMATPrep