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Thursday, July 07, 2005

Malpractice rates climbing; Blumenthal condems insurers

Here's an interesting article from the Los Angeles Times. They are reporting on a study done by Center for Justice & Democracy which shows that the rate insurers charge physicians for malpratice rose over the last five years by 120 percent while the amount of money paid by the insurers increased by only 5.7 percent. Guess who pays for this increase? If you said us, you're right.

"This is wacky," said Jay Angoff, a former insurance commissioner in Missouri during the 1990s and the primary author of the study. "Now what's the insurance companies' defense to this?"

Researchers looked at annual statements filed with state insurance departments by the nation's 15 largest medical malpractice insurers.

The report also found that the leading insurers increased their surpluses -- money accumulated beyond what they anticipate needing to pay future claims -- by a third.

"The extra cherry on top for the industry, and the extra knife in the gut for doctors, is not only did claims payments go down ... the companies also added to their surpluses," Angoff said.
Insurers are critical of the study but Connecticut Attorney General Richard Blumenthal is now looking into the matter.
Consumer advocates and public officials said the study has the potential to recast the often bitter debate about who is responsible for rising malpractice rates: doctors, trial lawyers or the industry.

Connecticut Attorney General Richard Blumenthal called on the National Association of Insurance Commissioners to review the study, and suggested a model law would be useful for state legislatures.

Blumenthal also had some hard words for the insurers...

"The numbers underscore the need for much tougher, more aggressive oversight to prevent and punish profiteering," Connecticut Attorney General Richard Blumenthal said. "Federal and state regulators should thoroughly scrutinize recent rate increases and take appropriate corrective action. Affordable medical malpractice insurance is critical to public health. Expensive insurance rates become a matter of life and death when they drive doctors out of business - as is happening in Connecticut and nationwide. Insurance company greed can be hazardous to our health."