Malpractice Insurance Costs Reach Crisis Levels

Skyrocketing medical malpractice insurance rates have reached crisis levels and are forcing doctors to leave the practice of medicine, reveals a nationwide analysis recently released by the American Medical Association (AMA). The problem has reached "crisis proportions" in 12 states-Florida, Georgia, Mississippi, Nevada, New Jersey, New York, Ohio, Oregon, Pennsylvania, Texas, Washington, and West Virginia-and more than 30 other states are seeing problem signs.

According to AMA President Dr. Richard Corlin, "As [malpractice] insurance becomes unaffordable or unavailable and the legal system produces multi-million dollar jury awards on a regular basis, physicians are forced to limit services, leave their practice, or relocate-all of which seriously impede patient access to high-quality health care." Surgeons and obstetricians are among the most affected specialties-facing annual premiums as high as $200,000 or more.

Causes for the crisis include fewer firms writing malpractice insurance, the bankruptcy of several insurance companies, increased jury awards, and health-care facilities that are too willing to settle cases in order to avoid bad publicity. According to the AMA, jury awards in medical liability cases increased 43% in 1999-up to $1 million from $700,000.

To help ease the crisis, the AMA is asking Congress to support the Health Act of 2002, which proposes a cap of $250,000 for non-economic damages (such as pain, suffering and mental anguish) and caps punitive damages up to two times economic damages. Economic damages-which includes things such as lost wages, medical costs, and rehabilitative care-would be unlimited.

From "Malpractice Costs Spell Crisis," Reuters News