Pennsylvania tort crisis: Lawmakers fiddle, doctors burn

Physicians welcome an abatement of their payments into the state's MCare fund but say long-term solutions are needed to keep them in business.

By Tanya Albert, AMNews staff. Jan. 12, 2004.

General practice physician Ronald Martin, MD, isn't expecting to make any money in his rural practice in Cambridge Springs, Pa., this year.

In fact, he's borrowing money from a family member to keep his practice afloat.

He has no choice if he wants to keep his medical license. In Pennsylvania -- one of the 19 states the American Medical Association says is in the midst of a medical liability insurance crisis -- physicians have to carry insurance in order to be licensed.

Insurance this year will cost Dr. Martin about $24,000. That's without assuming the higher risk -- and higher insurance premium -- associated with delivering babies. Dr. Martin gave up obstetrics years ago, and he stopped working in the emergency department this year in order to reduce his premium a bit.

Still, the $24,000 premium reflects a 400% increase in the cost of his medical liability insurance over the past three years. It's an increase that would be difficult for any small business to absorb.

On top of that, Dr. Martin has to pay more than $5,000 into the state's MCare fund, a catastrophic fund that Pennsylvania physicians contribute to in order to help pay jury awards throughout the state.

"I'm borrowing this time," said Dr. Martin, who turns 60 this year. "But I can't keep borrowing like this again and again."

Pennsylvania and West Virginia were the first states in the nation to start seeing medical liability insurers raise physician rates or leave the market. They were also the first states to see high-risk specialists retire early, move to other states or forgo procedures. The two states were also the first to watch residents and young physicians bypass them to set up practice in areas with a more friendly liability climate.