Doctors Around the Country Deal with Rising Malpractice Insurance Rates; Some Scale Back Practices

Physicians nationwide are facing "double-digit" hikes in malpractice premiums forcing many of them to stop offering certain procedures, move to states with lower premiums, or retire early, USA Today reports (Rubin, USA Today, 12/4). Rates now are not "unreasonabl[y] high," but historically, they have been "unrealistically low," according to Kevin O'Brien of The St. Paul Companies the second-largest malpractice underwriter in the country. Premiums for doctors were "stable" in the 1990s because insurers had "fat reserves" due to the "booming stock market." With the reserves, insurers were able to undercut each other to gain market share. Today, the stock market's decline coupled with increased malpractice claims has caused insurers to raise malpractice premiums (Rubin, USA Today, 12/4). Orthopedic surgery and obstetrics are the "hardest hit" specialties. The Physician Insurers Association of America says that from 1985 to 2000 obstetricians and gynecologists had the most claims made against them, due in part to the "lengthy" 18-year statute of limitations in such cases. In response, many physicians have stopped delivering babies, forcing women in "historically underserved areas to travel for care." USA Today reports that doctors blame "greedy" trial lawyers for the malpractice premium hike and that some physicians are lobbying state legislatures to enact tort reforms, such as caps on payments to plaintiffs. West Virginia state legislators this week approved "emergency measures" to keep physicians from leaving the state, including a state managed insurance program for those unable to obtain private malpractice coverage and mediation "to encourage pretrial settlements." John Schmitt, an obstetrician/gynecologist in Raleigh, N.C., wrote in a letter to his state senator that patients will end up paying for the premium hikes. "It won't be immediately passed on to the patients, as we are locked into managed care contracts on a fixed payment schedule. But we will all soon be paying for these increases by way of higher premiums, out-of-pocket expenses and deductibles," he wrote (Rubin, USA Today, 12/4). Leo Boyle, president of the American Trial Lawyers Association, said attorneys are not responsible for the premium increases. "The problem is that, in fact, people are hurt in the course of receiving medical care," he added (Rubin, USA Today, 12/4).