Archives
October 2005
10/27/05
10/27/05
10/27/05
10/27/05
10/27/05
10/19/05
10/19/05
10/11/05
10/11/05
10/11/05
10/11/05
10/11/05
10/7/05
10/7/05
10/7/05
10/6/05
10/6/05
10-6-05 - LIABILITY UPDATE - "Healthy recovery since...medical liability reform" Part 2
10/4/05
10/4/05
10/4/05
Thursday, October 6, 2005
5....WSJ Opinion Journal
In Mississippi, tort reform works.
BY CHARLIE ROSS
September 15, 2005
Legislative battles over tort reform are being waged in statehouses across the country. Congress, too, is fighting out the issue in the form of proposed legislation to cap medical malpractice damage awards and to reform asbestosis litigation. Always hotly debated in such contests is whether tort reform accomplishes its purported goals. Does it make the legal system more predictable and more credible? Does it positively affect insurance costs and availability? Does it reduce litigation expenditures? More broadly, does it improve the economic well-being of the citizens?
In 2004, a long hard battle in the Mississippi Legislature over a comprehensive Tort Reform Bill came to a close, during which the same questions arose. Opponents claimed that the bill was unnecessary, and that, even if it passed, it would not make a difference. Still, we were able to get it through. In many respects, the bill is considered model legislation. Among other provisions, it included venue reform (so trial lawyers cannot shop around for favorable courts) and caps on subjective noneconomic damages (such as pain and suffering). Now, a year has passed since the legislation took effect, and the Mississippi experience is instructive. Tort reform works.
Prior to the legislation, Mississippi was known as the "jackpot justice capital of America." The American Tort Reform Association had labeled certain jurisdictions "judicial hellholes." A survey of more than 1,200 senior in-house counsels for the U.S. Chamber Commerce ranked Mississippi 50th in virtually every category of judicial system nationwide. Insurance companies were fleeing the state. Others were refusing to write new policies. The medical field was particularly strained: Liability insurance was in many cases unaffordable, and in some cases unavailable. One year later, the story is very different. Mass Mutual Insurance Group, St. Paul Travelers, World Insurance Co. and Equitable Life Insurance Co. are returning to Mississippi. State Farm Insurance eased its growth restrictions for homeowners' insurance and lowered its rates on property insurance.
The Medical Assurance Company of Mississippi, which writes 60% of the medical malpractice coverage for doctors in the state, had raised its rates 20% the year prior to the tort reform legislation. After its passage, MACM did not raise its rates at all. "Those people who said tort reform would not work and actively fought any civil justice reform," Mississippi Insurance Commissioner George Dale said. "I think this indicates they were wrong." MACM also recently announced an end to its moratorium on new business; it also just declared it will cut its rates for 2006.
Insurance was becoming less available and less affordable prior to the passage of the tort reform legislation. Now, the opposite is true. Some plaintiff lawyers and some consumer groups still contend that tort reform doesn't work--but it does not take a rocket scientist to understand that when liability exposure is made predictable and governed by reasonable rules, risk can be better assessed, and insurance companies are more likely to offer coverage.
Gov. Haley Barbour attributes the successful recruitment of new business to Mississippi to the lower cost of doing business in the state. Texatron has invested $35 million and Kingsford Charcoal $20 million; we have coaxed back Winchester Ammunition and its $3.5 million payroll, as well FedEx Ground, as part of a $1.8 billion expansion.
Our reform package also virtually eliminated the mass-tort industry in Mississippi. This change came about not only because the legislation provided that venues for lawsuits must be established independently for each plaintiff, but also because Mississippi Supreme Court decisions reinstated the traditional rules of joinder of plaintiffs. These two changes went hand in hand, since the process of passing tort reform (which lasted four years) raised public awareness of the problem, which in turn affected judicial elections. This has provided for a more balanced judiciary.
As a result of these procedural changes, pending mass-tort cases are being split up. The cases of out-of-state plaintiffs are being dismissed, and the cases of in-state plaintiffs are being transferred to the proper venues for trial. Lawsuits in Mississippi are returning to what they are supposed to be--and used to be--about: one plaintiff, or a very small group of plaintiffs, suing a defendant, or a very small group of defendants, for a single cause of action. Common sense has made a comeback.
Not surprisingly, the demise of mass-tort litigation has resulted in a decrease in litigation costs. The CEO of one Mississippi company recently told me that his company's legal bills were reduced by $70,000 a month as a result of the reform. Litigation expense does not produce value for most members of our society. It is merely a transaction cost in the transfer of wealth to compensate injured persons. To be justified, the transfer process must be fair.
Mississippi's mass-tort system was anything but fair, and in many cases it resulted in patently unjustified awards. And people had lost confidence in getting a fair hearing at the trial court level. There was no confidence that the appellate courts would correct abuses. In essence, there was total unpredictability. The sky was the limit on damages. There was even a perception that fundamentals of the rule of law were being threatened. Since the passage of tort reform and the changes implemented by judicial decisions, both perception and reality have changed. We have begun to restore credibility to Mississippi courts in the mind of the public and business, and have thus restored trust to government in Mississippi in general.
Since only a year has passed, the long-term consequences of tort reform cannot be known. There are thousands of cases in the system still governed by the old rules. There is enough information, however, to state unequivocally that tort reform has made the Mississippi legal environment more fair, more predictable and less expensive. For now, that is more than enough.
Mr. Ross is a Mississippi state senator and chairman of the senate judiciary A committee.
6....Modern Physician.com
W.Va. med mal insurers seek rate cuts as lawsuits decline
August 12, 2005
West Virginia's two largest medical malpractice insurers are asking the state Insurance Commission for permission to reduce their rates. The board of not-for-profit West Virginia Physicians' Mutual Insurance Co., the largest medical malpractice insurer in the state, voted Thursday to seek a 5% rate reduction, effective Jan. 1, said President David Rader. Woodbrook Casualty Insurance, the state's largest private malpractice insurer, is asking for a 3.9% decrease, effective Oct. 20.
The number of malpractice lawsuits has declined since the state Legislature changed laws regarding medical malpractice lawsuits, starting in 2001, said Bill Kenney, deputy insurance commissioner.
Rader said his company also is aggressively working with injured patients to try to prevent lawsuits. For example, the insurer is encouraging physicians to apologize for mistakes and are offering to pay for certain costs for injured patients immediately, no questions asked, he said.
7...Atlanta Business Chronicle
Experts: State should expect healthy influx of doctors
Tort reform expected to bring more specialists to Georgia
Lori Johnston
September 12, 2005
As she faces the challenge of recruiting physicians to WellStar Health System, Dee Hammond has seen encouraging signs recently. At a job fair in Texas, she noticed physicians completing their residency were considering positions in Georgia. She's also had calls from physicians working in states with medical malpractice crises interested in relocating to Georgia. The state's new tort reform laws have given Georgia an edge in trying to attract physicians, especially in high-demand specialty areas like surgery and obstetrics, Hammond said.
The biggest provision affecting the medical field in the law was a cap on noneconomic damages of $250,000, or $750,000 if there are multiple defendants.
"We wouldn't be getting calls from Pennsylvania and Florida if we had not had tort reform in Georgia," said Hammond, director of provider services at WellStar.
Some doctors in Georgia already have seen a positive impact from the law, which supporters hope will drive down the high cost of malpractice insurance.
"Now we've got hope of some more doctors coming into the state," said Dr. Kay Kirkpatrick, co-president of Resurgens Orthopaedics P.C.
Kirkpatrick said her insurer already has frozen rates and plans to roll rates back if the law survives legal challenges..
Kirkpatrick also notes how tort reform laws passed in Texas in 2003 are having an effect in that state, with the number of insurance carriers growing from four to 22, and the largest insurer in Texas issuing a 16 percent rate reduction.
If Georgia's law withstands court challenges, Dr. Don Campbell, medical director for Cobb Hospital and the WellStar Physicians Group, expects to see more carriers entering the Georgia market, driving down costs.
"I think it will make it easier for us to keep doctors in Georgia who train here and easier for us to attract doctors to Georgia," he said.
If that happens, metro Atlanta may be able to fill the need for obstetricians, neurosurgeons and other specialists by attracting them away from states that have not yet passed tort reform, Campbell said. He expects to see the influx of physicians by late 2006.
Another need in Georgia is for hospitalists, also known as inpatient physicians, whose primary focus is the care of hospitalized patients. Hammond said she has seen figures that indicate as many as 80 percent of hospitals are recruiting for hospitalists.
WellStar has hospitalist programs at its Kennestone, Cobb and Paulding hospitals and is establishing a program at its Douglas Hospital. Over the next year, Hammond anticipates hiring 10 hospitalists and another 15 to 20 physicians.
8....Arkansas Democrat Gazette
Arkansas medical malpractice rate slows
LITTLE ROCK — Doctors in Arkansas saw the smallest jump in medical malpractice premiums this year, largely due to the ability of insurance companies to balance their books after huge increases in previous years, the state Insurance Department says.
State Volunteer Insurance Co., which covers about 75 percent of Arkansas doctors who buy their own insurance, had a 5.5 percent increase in premiums this year, down from a 13.6 percent increase in 2004, the department said in an annual report required by a 2003 state law.
"It seems to go in waves," said Steve Williams, chief executive officer of State Volunteer Mutual. "(Premiums) go up for a while and plateau, go up for a while and plateau. It never really goes all the way back down."
The report said greater increases in the recent past allowed insurers to balance their books in 2004 after years of losses. For every dollar collected in premiums last year, malpractice insurers spent 97 cents in claims. In 2003, insurers spent $1.32 for every dollar taken in.
Between 1999 and 2005, State Volunteer Mutual's malpractice premiums for internal medicine shot up 240 percent. In 2004, the American Medical Association labeled Arkansas one of 15 "crisis states," saying that rising malpractice premiums and the lack ofrestrictions on the size of jury awards in malpractice lawsuits were driving doctors out of the state.
But David Wroten, executive vice president of the Arkansas Medical Society, said that hasn't happened.
"When (State Volunteer Mutual) only gives a 5 percent rate increase, no one's going to go shopping for another carrier," he said. "A lot of states have it a lot worse than we do."
Much of the increase came in 2002, after The St. Paul Cos. left the malpractice market. The company insured 51 percent of Arkansas doctors. With more claims, State Volunteer then raised premiums by 49 percent over the course of the year and other insurers increased rates by as much as 97.5 percent.
St. Paul wasn't the only company to leave the market. In 1996, 81 companies offered malpractice insurance in Arkansas, said Charlye Woodard, an Insurance Department spokeswoman. Today there are six.
"The loss of even one more medical malpractice insurer will result in significant declines in both availability and affordability of coverage for the medical community," the department report said. The 3,100 internists insured by State Volunteer now pay $6,100 annually for coverage, Williams said. Doctors in many other states pay more, though.
In 2003, the state Legislature passed a law to limit punitive damages in medical malpractice lawsuits and place tougher evidence requirements on plaintiffs. The number of claims fell and insurance rate increases slowed. But the Insurance Department says the law is too new to credit it with the relatively small jump in medical malpractice premiums. ((Evidence from other states indicates that even a NEW law will help to reduce premiums....of course, everyone understands that the cases which are "in the hopper" aren't subject to the new laws and that it will take a few years for the full effect to be felt....especially if there are possible constitutional challenges....but I think this signals a positive trend for Arkansas, due largely to medical liability reform and a cap on pain and suffering...))
"Act 649 of 2003 has only been in effect since March 25, 2003, so it would still be premature to expect it to have had a significant impact on rates," the report said.
An opponent of the 2003 law, lawyer Morgan E. "Chip" Welch of Little Rock predicts the tort changes actually will have no effect on the behavior of insurance companies.
"It doesn't affect the ability of insurance companies to charge an arm and a leg for coverage," he said. "They do that because they can. They will raise rates."
Please visit the Liability Update Weblog at:
http://journals.aol.com/rovspa/LiabilityUpdate/
If you would like to be added to or removed from the Liability Update Information Network, or if you have information about yourself or a colleague relocating, retiring early, giving up medicine, private practice or curtailing services due to the medical liability crisis please email ROVSPA@aol.com
rovspa at 5:18:00 PM EDT Blog about this entry |
Add to del.icio.us | 
digg this
10-6-05 - LIABILITY UPDATE - "Healthy recovery since...medical liability reform" Part 2
5....WSJ Opinion Journal
In Mississippi, tort reform works.
BY CHARLIE ROSS
September 15, 2005
Legislative battles over tort reform are being waged in statehouses across the country. Congress, too, is fighting out the issue in the form of proposed legislation to cap medical malpractice damage awards and to reform asbestosis litigation. Always hotly debated in such contests is whether tort reform accomplishes its purported goals. Does it make the legal system more predictable and more credible? Does it positively affect insurance costs and availability? Does it reduce litigation expenditures? More broadly, does it improve the economic well-being of the citizens?
In 2004, a long hard battle in the Mississippi Legislature over a comprehensive Tort Reform Bill came to a close, during which the same questions arose. Opponents claimed that the bill was unnecessary, and that, even if it passed, it would not make a difference. Still, we were able to get it through. In many respects, the bill is considered model legislation. Among other provisions, it included venue reform (so trial lawyers cannot shop around for favorable courts) and caps on subjective noneconomic damages (such as pain and suffering). Now, a year has passed since the legislation took effect, and the Mississippi experience is instructive. Tort reform works.
Prior to the legislation, Mississippi was known as the "jackpot justice capital of America." The American Tort Reform Association had labeled certain jurisdictions "judicial hellholes." A survey of more than 1,200 senior in-house counsels for the U.S. Chamber Commerce ranked Mississippi 50th in virtually every category of judicial system nationwide. Insurance companies were fleeing the state. Others were refusing to write new policies. The medical field was particularly strained: Liability insurance was in many cases unaffordable, and in some cases unavailable. One year later, the story is very different. Mass Mutual Insurance Group, St. Paul Travelers, World Insurance Co. and Equitable Life Insurance Co. are returning to Mississippi. State Farm Insurance eased its growth restrictions for homeowners' insurance and lowered its rates on property insurance.
The Medical Assurance Company of Mississippi, which writes 60% of the medical malpractice coverage for doctors in the state, had raised its rates 20% the year prior to the tort reform legislation. After its passage, MACM did not raise its rates at all. "Those people who said tort reform would not work and actively fought any civil justice reform," Mississippi Insurance Commissioner George Dale said. "I think this indicates they were wrong." MACM also recently announced an end to its moratorium on new business; it also just declared it will cut its rates for 2006.
Insurance was becoming less available and less affordable prior to the passage of the tort reform legislation. Now, the opposite is true. Some plaintiff lawyers and some consumer groups still contend that tort reform doesn't work--but it does not take a rocket scientist to understand that when liability exposure is made predictable and governed by reasonable rules, risk can be better assessed, and insurance companies are more likely to offer coverage.
Gov. Haley Barbour attributes the successful recruitment of new business to Mississippi to the lower cost of doing business in the state. Texatron has invested $35 million and Kingsford Charcoal $20 million; we have coaxed back Winchester Ammunition and its $3.5 million payroll, as well FedEx Ground, as part of a $1.8 billion expansion.
Our reform package also virtually eliminated the mass-tort industry in Mississippi. This change came about not only because the legislation provided that venues for lawsuits must be established independently for each plaintiff, but also because Mississippi Supreme Court decisions reinstated the traditional rules of joinder of plaintiffs. These two changes went hand in hand, since the process of passing tort reform (which lasted four years) raised public awareness of the problem, which in turn affected judicial elections. This has provided for a more balanced judiciary.
As a result of these procedural changes, pending mass-tort cases are being split up. The cases of out-of-state plaintiffs are being dismissed, and the cases of in-state plaintiffs are being transferred to the proper venues for trial. Lawsuits in Mississippi are returning to what they are supposed to be--and used to be--about: one plaintiff, or a very small group of plaintiffs, suing a defendant, or a very small group of defendants, for a single cause of action. Common sense has made a comeback.
Not surprisingly, the demise of mass-tort litigation has resulted in a decrease in litigation costs. The CEO of one Mississippi company recently told me that his company's legal bills were reduced by $70,000 a month as a result of the reform. Litigation expense does not produce value for most members of our society. It is merely a transaction cost in the transfer of wealth to compensate injured persons. To be justified, the transfer process must be fair.
Mississippi's mass-tort system was anything but fair, and in many cases it resulted in patently unjustified awards. And people had lost confidence in getting a fair hearing at the trial court level. There was no confidence that the appellate courts would correct abuses. In essence, there was total unpredictability. The sky was the limit on damages. There was even a perception that fundamentals of the rule of law were being threatened. Since the passage of tort reform and the changes implemented by judicial decisions, both perception and reality have changed. We have begun to restore credibility to Mississippi courts in the mind of the public and business, and have thus restored trust to government in Mississippi in general.
Since only a year has passed, the long-term consequences of tort reform cannot be known. There are thousands of cases in the system still governed by the old rules. There is enough information, however, to state unequivocally that tort reform has made the Mississippi legal environment more fair, more predictable and less expensive. For now, that is more than enough.
Mr. Ross is a Mississippi state senator and chairman of the senate judiciary A committee.
6....Modern Physician.com
W.Va. med mal insurers seek rate cuts as lawsuits decline
August 12, 2005
West Virginia's two largest medical malpractice insurers are asking the state Insurance Commission for permission to reduce their rates. The board of not-for-profit West Virginia Physicians' Mutual Insurance Co., the largest medical malpractice insurer in the state, voted Thursday to seek a 5% rate reduction, effective Jan. 1, said President David Rader. Woodbrook Casualty Insurance, the state's largest private malpractice insurer, is asking for a 3.9% decrease, effective Oct. 20.
The number of malpractice lawsuits has declined since the state Legislature changed laws regarding medical malpractice lawsuits, starting in 2001, said Bill Kenney, deputy insurance commissioner.
Rader said his company also is aggressively working with injured patients to try to prevent lawsuits. For example, the insurer is encouraging physicians to apologize for mistakes and are offering to pay for certain costs for injured patients immediately, no questions asked, he said.
7...Atlanta Business Chronicle
Experts: State should expect healthy influx of doctors
Tort reform expected to bring more specialists to Georgia
Lori Johnston
September 12, 2005
As she faces the challenge of recruiting physicians to WellStar Health System, Dee Hammond has seen encouraging signs recently. At a job fair in Texas, she noticed physicians completing their residency were considering positions in Georgia. She's also had calls from physicians working in states with medical malpractice crises interested in relocating to Georgia. The state's new tort reform laws have given Georgia an edge in trying to attract physicians, especially in high-demand specialty areas like surgery and obstetrics, Hammond said.
The biggest provision affecting the medical field in the law was a cap on noneconomic damages of $250,000, or $750,000 if there are multiple defendants.
"We wouldn't be getting calls from Pennsylvania and Florida if we had not had tort reform in Georgia," said Hammond, director of provider services at WellStar.
Some doctors in Georgia already have seen a positive impact from the law, which supporters hope will drive down the high cost of malpractice insurance.
"Now we've got hope of some more doctors coming into the state," said Dr. Kay Kirkpatrick, co-president of Resurgens Orthopaedics P.C.
Kirkpatrick said her insurer already has frozen rates and plans to roll rates back if the law survives legal challenges..
Kirkpatrick also notes how tort reform laws passed in Texas in 2003 are having an effect in that state, with the number of insurance carriers growing from four to 22, and the largest insurer in Texas issuing a 16 percent rate reduction.
If Georgia's law withstands court challenges, Dr. Don Campbell, medical director for Cobb Hospital and the WellStar Physicians Group, expects to see more carriers entering the Georgia market, driving down costs.
"I think it will make it easier for us to keep doctors in Georgia who train here and easier for us to attract doctors to Georgia," he said.
If that happens, metro Atlanta may be able to fill the need for obstetricians, neurosurgeons and other specialists by attracting them away from states that have not yet passed tort reform, Campbell said. He expects to see the influx of physicians by late 2006.
Another need in Georgia is for hospitalists, also known as inpatient physicians, whose primary focus is the care of hospitalized patients. Hammond said she has seen figures that indicate as many as 80 percent of hospitals are recruiting for hospitalists.
WellStar has hospitalist programs at its Kennestone, Cobb and Paulding hospitals and is establishing a program at its Douglas Hospital. Over the next year, Hammond anticipates hiring 10 hospitalists and another 15 to 20 physicians.
8....Arkansas Democrat Gazette
Arkansas medical malpractice rate slows
LITTLE ROCK — Doctors in Arkansas saw the smallest jump in medical malpractice premiums this year, largely due to the ability of insurance companies to balance their books after huge increases in previous years, the state Insurance Department says.
State Volunteer Insurance Co., which covers about 75 percent of Arkansas doctors who buy their own insurance, had a 5.5 percent increase in premiums this year, down from a 13.6 percent increase in 2004, the department said in an annual report required by a 2003 state law.
"It seems to go in waves," said Steve Williams, chief executive officer of State Volunteer Mutual. "(Premiums) go up for a while and plateau, go up for a while and plateau. It never really goes all the way back down."
The report said greater increases in the recent past allowed insurers to balance their books in 2004 after years of losses. For every dollar collected in premiums last year, malpractice insurers spent 97 cents in claims. In 2003, insurers spent $1.32 for every dollar taken in.
Between 1999 and 2005, State Volunteer Mutual's malpractice premiums for internal medicine shot up 240 percent. In 2004, the American Medical Association labeled Arkansas one of 15 "crisis states," saying that rising malpractice premiums and the lack ofrestrictions on the size of jury awards in malpractice lawsuits were driving doctors out of the state.
But David Wroten, executive vice president of the Arkansas Medical Society, said that hasn't happened.
"When (State Volunteer Mutual) only gives a 5 percent rate increase, no one's going to go shopping for another carrier," he said. "A lot of states have it a lot worse than we do."
Much of the increase came in 2002, after The St. Paul Cos. left the malpractice market. The company insured 51 percent of Arkansas doctors. With more claims, State Volunteer then raised premiums by 49 percent over the course of the year and other insurers increased rates by as much as 97.5 percent.
St. Paul wasn't the only company to leave the market. In 1996, 81 companies offered malpractice insurance in Arkansas, said Charlye Woodard, an Insurance Department spokeswoman. Today there are six.
"The loss of even one more medical malpractice insurer will result in significant declines in both availability and affordability of coverage for the medical community," the department report said. The 3,100 internists insured by State Volunteer now pay $6,100 annually for coverage, Williams said. Doctors in many other states pay more, though.
In 2003, the state Legislature passed a law to limit punitive damages in medical malpractice lawsuits and place tougher evidence requirements on plaintiffs. The number of claims fell and insurance rate increases slowed. But the Insurance Department says the law is too new to credit it with the relatively small jump in medical malpractice premiums. ((Evidence from other states indicates that even a NEW law will help to reduce premiums....of course, everyone understands that the cases which are "in the hopper" aren't subject to the new laws and that it will take a few years for the full effect to be felt....especially if there are possible constitutional challenges....but I think this signals a positive trend for Arkansas, due largely to medical liability reform and a cap on pain and suffering...))
"Act 649 of 2003 has only been in effect since March 25, 2003, so it would still be premature to expect it to have had a significant impact on rates," the report said.
An opponent of the 2003 law, lawyer Morgan E. "Chip" Welch of Little Rock predicts the tort changes actually will have no effect on the behavior of insurance companies.
"It doesn't affect the ability of insurance companies to charge an arm and a leg for coverage," he said. "They do that because they can. They will raise rates."
Please visit the Liability Update Weblog at:
http://journals.aol.com/rovspa/LiabilityUpdate/
If you would like to be added to or removed from the Liability Update Information Network, or if you have information about yourself or a colleague relocating, retiring early, giving up medicine, private practice or curtailing services due to the medical liability crisis please email ROVSPA@aol.com
rovspa at 5:18:00 PM EDT Blog about this entry |
Add to del.icio.us | digg this
