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Liability insurance crisis: Bigger awards just one factor

Lower interest rates and a highly competitive insurance market also contributed to today's medical malpractice mess.

By Tanya Albert, amednews staff. April 15, 2002.

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The latest statistics confirm what many physicians already suspect: Jury verdicts in medical malpractice cases continue to soar.

Plaintiffs lose the majority of cases that go before a jury. But when they win, an increasing number win big.

The median medical malpractice awards were up nearly 43% between 1999 and 2000, according to Jury Verdict Research data released in late March. The Pennsylvania-based company gathers information on verdicts and awards from cases involving physicians, hospitals and other health care entities nationwide.

The fourth straight annual jump means that the median award -- the middle award value when the awards are listed in ascending order -- hit the $1 million mark in 2000. That's nearly double what it was in 1996, when the median award was $503,000, according to the statistics.

"There are jurisdictions where it is manifesting itself as a crisis," said Jim Hurley, an actuary with Tillinghast-Towers Perrin who looks at medical malpractice issues. "But it is not a crisis nationwide yet."

Physicians in Pennsylvania, West Virginia, Mississippi and Nevada have been the hardest hit by medical malpractice woes. The large jury awards coincide with other volatile factors that have some calling the situation "the perfect storm."

And it's unlikely physicians will see any relief this year.

Medical liability insurers continue to pull out of some markets or set narrow guidelines defining the physicians they are willing to insure. Interest rates remain low. And jury awards show no sign of coming under control. In March, a Florida jury said a physician, a physician's assistant and nursing staff were negligent in caring for a patient who ended up with a brain injury and awarded her $78.5 million. [...]