Phony liability insurers bilking desperate doctors

If someone selling medical liability insurance offers a deal that seems too good to be true, physicians should call their state insurance department.

By Tanya Albert, AMNews staff. Sept. 9, 2002.

Physician beware: It's an attractive market for scam artists looking to make a quick buck by selling worthless medical liability insurance.

Through-the-roof insurance bills have sent physicians scrambling for affordable insurance, setting the stage for people to create rogue insurance companies and bilk physicians for tens of thousands of dollars.

The Florida insurance department busted two unlicensed operations in August. If authorities in one state already have uncovered problems, fraud experts believe, there are more out there waiting to be unveiled.

"Con men come out of the woodwork with phony insurance swindles targeted toward professional groups having a hard time financially and having a hard time finding decent liability insurance," said James Quiggle, spokesman for the independent, nonprofit Coalition Against Insurance Fraud. "I suspect there's a lot of medical liability scams bubbling right underneath the radar screens of state insurance regulators."

It's typical of a tight insurance market. And the medical liability market is tighter than it has been in 20 years.

In the past year, many insurers have raised their rates, toughened the criteria that physicians have to meet to qualify for insurance or pulled out of the medical liability market altogether. The result, according to the AMA, is 12 states that now find themselves in a medical liability crisis with physicians retiring early, moving or no longer performing high-risk procedures. Another 30 states are showing early warning signs of a crisis, the AMA says. [...]