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Press Release

    Doctors Protest Rising Medical Liability Insurance Rates

    09/23/2004

    Excerpts from the Associated Press

    “Medical malpractice insurers in Rhode Island are seeking state approval for new rate hikes, over the protest of doctors' groups who say insurance costs have caused some physicians to quit or curtail their practices.

    The Department of Business Regulation will hold a hearing next month on a request by NORCAL Mutual Insurance Co. to raise its rates 19 percent for next year. The increase would come on top of a 42.8 percent increase for this year by NORCAL, the state's largest medical malpractice insurer.

    The company had wanted a 55.7 percent increase for this year, basing its request on a growing gap between claim losses and premiums collected since it began writing policies in Rhode Island in 1994.

    NORCAL isn't alone in seeking another increase. The DBR was set to hold a hearing Friday on a 15.5 percent rate increase for physicians and surgeons requested by ProSelect Insurance Co., which has the second-largest medical malpractice market share in Rhode Island.

    Newell Warde, the society's executive director, said 10 years ago, doctors in low-risk fields, such as general internists, paid about $4,000 annually for liability insurance. Next year, he said, they will pay about $15,000.

    Doctors in high-risk specialties - such as obstetricians and neurosurgeons - a decade ago, paid some $35,000. This year, their coverage costs about $92,000. It's estimated to be $109,600 next year.”

    […]

    “Warde said some doctors may leave medicine because of the proposed rate hike, but they are more likely to restrict their services. Some obstetricians have given up delivering babies, after calculating it would take some 54 deliveries per year just to pay the insurance bills, he said. Instead, they're working as gynecologists, Warde said, where they make less money, but their overhead is far lower.

    At South County Hospital, administrators have started subsidizing obstetricians' insurance costs to keep the obstetrics ward open, Warde said.

    Earlier this year, Gov. Don Carcieri proposed capping the amount of money medical malpractice victims could collect for pain and suffering. The Republican governor also wants to speed up the court process, and make other reforms to the medical liability system. The General Assembly did not vote on the proposal, said Jeff Neal, the governor's spokesman.”

    […]

    “Rhode Island's medical liability situation is not unique. The American Medical Association has designated medical liability reform its top legislative issue, and has declared medical liability as a crisis in 20 states, including Connecticut and Massachusetts.

    The AMA calls Rhode Island one of the ‘states showing problem signs.’

    Donald Palmisano, a physician and a surgeon from New Orleans, and the immediate past president of the AMA, said the association traces the risking liability insurance rates to increasingly high jury verdicts in malpractice cases.

    He also faults what he said is a higher number of frivolous lawsuits which do not result in a settlement or judgment against the physician, but which cost money to defend. The AMA is pushing Congress to reform medical liability law.”