Liability insurance crisis: Physicians must fight for tort reform -- again

Doctors and organized medicine must fight anew to stabilize insurance rates.

Editorial. May 6, 2002.

The latest news in professional liability insurance underscores both the extent of the growing problem and what will be necessary for relief.

Perhaps the most striking bad news is the recent data for jury awards in malpractice cases. It is a telling measure of the "liability lottery" element of the current tort system that is a significant factor in rising premiums. The median award grew in 2000 (the latest data available) to $1 million, the fourth yearly increase. The median was 43% higher than the year before and twice as much as in 1995.

No wonder premiums are headed up. Last year, more than 20 states saw at least one insurer increase rates by more than 25%, and this year is expected to be worse.

Coverage is also harder to get. The St. Paul Companies' decision to leave the market left 40,000 doctors looking for insurance, and smaller insurer departures from the marketplace already have been reported.

On the good-news side is the welcome show of activism by Texas physicians, who marched last month in several cities to call attention to the need for tort reform. Mississippi doctors held a similar protest in January at their statehouse. Best of all, at least so far this year, was the March victory by Pennsylvania physicians, who saw a hard-fought package of reforms enacted by their state Legislature. It is an important step that will provide at least some relief in a state that is among those most in crisis.

On the very near horizon, it is expected that a solid package of national reforms will be introduced in Congress. Key elements are believed to include sensible limits on noneconomic damages, the allocation of damages based on the extent of the defendant's degree of fault (to halt unfair targeting of "deep pocket" defendants) and power to the courts to keep trial lawyers from harvesting an unfair portions of awards. Look for the AMA to be there, to demonstrate its strong support, when the reform package is unveiled. [...]