Rising Malpractice Premiums Send Doctors Running

From the December 31, 2000 Philadelphia Inquirer article, “Rising Cost of Insurance Sends Doctors Scurrying,” by Josh Goldstein and Margie Fishman

Pennsylvania residents could find themselves unable to obtain many of the services of their surgeons, neurosurgeons, obstetricians, and other physicians as many area doctors scale back, retire, or leave the region due to dramatic increases in malpractice premiums. The higher rates are attributed to a variety of factors—some of which are unique to Pennsylvania.

• Insurance executives cite large malpractice jury awards and settlements in eastern Pennsylvania as a major factor in boosting premiums. Other factors include expanded malpractice coverage requirements, the dissipation of insurance company reserves, and liquidation expenses for two large Pennsylvania malpractice carriers that failed several years ago.
• Lawyers for plaintiffs attribute the rise in premiums to economic factors, including the recent stock market downturn. Such crises have occurred periodically since the 1800s, lawyers say, and have always eased when economic pressures decrease.
• Doctors see tort reform as the critical factor. Although sympathetic to patients who have been injured by negligent care, doctors stress the difference between malpractice and mal-occurrence. According to Philadelphia surgeon Michael Rutberg, “Sometimes you can do everything right and the outcome still isn’t positive.” Another problem is commercial insurance carriers that won’t accept new business unless an applicant has an absolutely claim-free record.

The results could be immediate and dramatic—affecting the financial health of hospitals and making it more difficult to attract good, young doctors to the region. For patients, access to care will be affected. Many may have difficulty finding a doctor willing to perform surgery (particularly elective surgery) or deliver a baby. The direst consequences may occur if trauma centers are forced to divert patients to other facilities because staffing requirements cannot be met. In the worst-case scenario, community hospitals may be forced to close their trauma units entirely.

The effects are already being felt. At Frankford Hospital’s three facilities in Northeast Philadelphia and Bucks County, all 12 active orthopedic surgeons put down their scalpels after their malpractice premiums doubled. At the Main Line Health System’s obstetrics and gynecology department, five obstetricians have left in the past few months—and many others are talking about leaving. According to department chair Nancy S. Roberts, “Doctors are telling their patients that as of January they won’t be delivering babies because they can’t afford to do it.”