Medical Malpractice Insurers Price-Gouged Doctors During This Decade
This comes from Americans for Insurance Reform, released today:
NEW YORK — Americans for Insurance Reform (AIR) announced today the release of Stable Losses/Unstable Rates 2007, a new study that examines fresh insurance industry data to determine what caused the most recent medical malpractice insurance crisis for doctors. The study by AIR, a coalition of over 100 consumer and public interest groups representing more than 50 million people, finds that the insurance crisis that hit doctors between 2001 and 2004 was not caused by claims, payouts or legal system excesses as the insurance industry claimed. Rather, according to the industry’s own data:
- Inflation-adjusted payouts per doctor not only failed to increase between 2001 and 2004, a time when doctors’ premiums skyrocketed, but they have been stable or falling throughout this entire decade.
- Medical malpractice insurance premiums rose much faster in the early years of this decade than was justified by insurance payouts.
- At no time were recent increases in premiums connected to actual payouts. Rather, they reflected the well-known cyclical phenomenon called a “hard” market. Property/casualty insurance industry “hard” markets have occurred three times in the past 30 years.
- During this same period, medical malpractice insurers vastly (and unnecessarily) increased reserves (used for future claims) despite no increase in payouts or any trend suggesting large future payouts. The reserve increases in the years 2001 to 2004 could have accounted for 60 percent of the price increases witnessed by doctors during the period.
There is much more at the links, including a copy of the study.
(hat tip to TortDeform)