http://www.makethemaccountable.com/myth/RisingCostOfMedicalMalpracticeInsurance.htm

Rising doctors' premiums not due to lawsuit awards

Study suggests insurers raise rates to make up for investment declines

By Liz Kowalczyk, Globe Staff  |  June 1, 2005

Re-igniting the medical malpractice overhaul debate, a new study by Dartmouth College researchers suggests that huge jury awards and financial settlements for injured patients have not caused the explosive increase in doctors' insurance premiums.

The researchers said a more likely explanation for the escalation is that malpractice insurance companies have raised doctors' premiums to compensate for falling investment returns.

The Dartmouth economists studied actual payments made to patients between 1991 and 2003, the results of which were published yesterday in the journal Health Affairs. Some previous studies have examined jury awards, which often are reduced after trial to comply with doctors' insurance coverage maximums or because the plaintiff settles for less money to avoid an appeal. Researchers found that payments grew an average of 4 percent annually during the years covered by the study, or 52 percent overall since 1991, but only 1.6 percent a year since 2000. The increases are roughly equivalent to the overall rise in healthcare costs, said Amitabh Chandra, lead author and an assistant professor of economics at the New Hampshire college…

Meanwhile, malpractice insurance premiums for internists, general surgeons, and obstetricians have skyrocketed since 2000, jumping 20 to 25 percent in 2002 alone…

''It's not payments that's causing this," Chandra said. ''The simple explanation that comes to mind is the underwriting cycle. If they're making less money from the investment side of things, it's going to cause [insurance companies] to raise rates."

The study's conclusions are sure to generate praise from some malpractice lawyers and outrage from many doctors and insurance company executives, who argue that jury awards are out of control and the solution is a cap on noneconomic damages for plaintiffs, commonly referred to as ''pain and suffering" awards.

The American Medical Association, a national organization based in Chicago that represents doctors, and the Physician Insurers Association of America, a coalition of malpractice insurers based in Maryland, are lobbying for a nationwide $250,000 cap, and President Bush has made a cap on noneconomic damages a key component of his malpractice reform proposal…

Center for Justice & Democracy

MYTHBUSTER
THE SEVEN MOST IMPORTANT THINGS TO KNOW ABOUT MEDICAL MALPRACTICE

February 10, 2004

1. Insurance industry profits are going through the roof and not a single doctors’ group has demanded any accountability from, or reforms of, the insurance industry for its excessive price-gouging of doctors.

MYTHBUSTER: Insurance industry profits, including those of medical malpractice insurers, are booming

Insurance Companies Raking in Huge Profits

2. It has been proven repeatedly that “caps” and other “tort reforms” do not work. States that have enacted so-called “tort reform” have only seen their insurance rates continue to shoot up after passing severe liability limits. In fact, doctors from at least three of the nine states represented at the national news conference scheduled for February 10 - Ohio, Missouri and Texas - and two out of seven states being targeted for media campaigns - Nevada and Florida - all have severe caps and in each case, insurers have continued to increase insurance rates.

Limiting Liability Will Not Fix Insurance Problems

The Impact of Non-Economic Damage Caps on Physician Premiums, Claims Payout Levels, and Availability of Coverage

3. Lawsuits are not limiting access to health care. The U.S. General Accounting Office found, after an extensive investigation, that doctors’ groups have misled, fabricated evidence, or, at the very least, wildly overstated their case about how malpractice insurance problems have limited access to health care. The only health care access problems that GAO could confirm were isolated and the result of factors having nothing at all to do with the legal system.

MEDICAL MALPRACTICE: Implications of Rising Premiums on Access to Health Care

Center for Justice & Democracy letter to the American Medical Association regarding the GAO study above.

4. Medical malpractice costs are a tiny percentage of overall health care expenditures. Medical malpractice insurance and claims costs represent, at most, only 2 percent of overall health care spending in this country, according to both the Congressional Budget Office and the General Accounting Office.

President Uses Dubious Statistics on Costs of Malpractice Lawsuits

Think Malpractice is Driving Up Health Care Costs? Think Again.

Tillinghast’s "Tort Cost" Figures Vastly Overstate the Cost of the American Legal System

5. Medical malpractice lawsuit filings, payouts and jury verdicts are all dropping. According to the National Center for State Courts (NCSC), “the 1992 to 2001 trend in medical malpractice filings per 100,000 population has only fluctuated minimally, with an overall 1 percent decrease in per capita filings.”

Tort and Contract Caseloads in State Trial Courts

·        Total medical malpractice payouts dropped 6.9 percent from 2001 to 2002 according to a National Practitioner Data Bank (NPDB) analysis by Public Citizen.

Quick Facts on Medical Malpractice Issues

·        Jury verdicts in medical malpractice cases are stagnant, even according to Jury Verdict Research data, which tends to over-inflate award trends.

Verdict and Settlement Study Released: No Change in Median Medical Malpractice Jury Award
Plaintiff Recovery Rate Up a Fraction

6. Most malpractice is caused by a small number of doctors who are never sanctioned. Nothing is being done to crack down on the 5 percent of doctors (1 out of 20) that are responsible for 54 percent of malpractice payouts.

Quick Facts on Medical Malpractice Issues

QuestionableDoctors.org

7. Medical malpractice is continuing at epidemic proportions in this country. In 1999, the Institute of Medicine, part of the National Academy of Sciences, found that medical errors cause between 44,000 and 98,000 deaths in hospitals each year. Even when using the lower estimate, deaths due to medical errors exceed the number attributable to the 8th leading cause of death. More die in a given year as a result of medical errors than from motor vehicle accidents (43,458), breast cancer (42,297) or AIDS (16,516).

To Err Is Human: Building a Safer Health System

mrstickball said: Sam - I think they do pay full price. Of course, we now have the wide, wonderful world of generic prescriptions, which are rapidly driving down costs. What used to cost $50 per 30 day supply now costs $5. Free market economics

No.  They don't pay full prices, state governments negotiate the prices like insurance companys... it's just they suck at it...

Blame kickbacks and needing lobbying groups support... or at least i'd guess that's why.  For example in NY physicians and specialsits get screwed... but hospitals get paid more then generously.

Unlike insurance companies... if your getting bad rates you can't just pull out of your insurance policy. (Like I did recently.)

Medicaid and Medicare pay more then private insurance does because the government doesn't have to worry about losing the poors buisness... and the people in these jobs don't have to worry about losing their jobs.

Abortion isn't an operation, it's a persons life.

Just proving a point.

mrstickball said: Sam - I think they do pay full price. Of course, we now have the wide, wonderful world of generic prescriptions, which are rapidly driving down costs. What used to cost $50 per 30 day supply now costs $5. Free market economics

Are you kidding me?  Prescription drug costs are still out of control and rise much more than inflation year after year.  Only recently have they started to slow down by a minimal degree but still rise much faster than inflation.

http://www.kaiseredu.org/topics_im.asp?id=352&parentID=68&imID=1

Several factors have contributed to this growth in spending on pharmaceuticals, including:

• Increased utilization and demand for prescription drugs - From 1994 to 2004, the number of prescriptions purchased in the United States increased 68%, [4] while the population only grew 12%. [5]
• Price increases - Retail prescription prices have increased on average 8.3% annually between 1994 and 2004, [6] much faster than the average inflation rate of 2.5%. [7] These prices include, in some cases, those of newer, higher-priced brand name drugs that have replaced older, less expensive drugs, and also the impact of movement from brand name drugs to their generic equivalents.
• Marketing to Consumers and Health Care Providers - Pharmaceutical manufacturers make substantial investments on marketing to consumers and physicians, which may influence consumer demand and physician prescribing practices. [8] Furthermore, the most heavily advertised products tend to be newer, more expensive drugs. This results in overall increases in spending. [9]

Generics weren't widely available in 2005, as per your report. It's only been within the past 2-3 years that major retailers like Wal-Mart began to care them en-masse.

Aged charts FTW!

I am just glad that if I am sick or injured, or if i gods forbid got cancer or something, that i would not have to pay a cent for treatment at a doctors or hospital and that I am not out of pocket for insurance expenses etc. I am a student, I cannot afford medical insurance.

I_Heart -

Problem is, when you get out of college, and, God forbid, you get a job, you WILL be paying for healthcare. Every day of your life, regardless if you use it or not.

Correct me if I'm wrong, but 100% of working citizens are taxed for NHS, correct? If this is the case, then if you become well-to-do (earn 1m/yr) you could be getting taxed $100,000/yr regardless if you use the service.

Remember: Nothing is free. Sure, it may be free to you for now, but someone has paid for it. Problem is, you don't get this because you don't work.

So everything should revolve around the contingency that we might someday become rich and might someday have to pay a little bit more than we would like?

What about the more likely reality that most people will not become that rich and will benefit from the health program?

It's nothing to do with being rich.  You still are paying a sizeable amount of your income even if you don't make a lot of money.

Mr Stickball, i know you are one of those fire and brimstone Republican christian types, who beleives that anyone who isnt the same as you, is on a different level of understanding (for reasons of having blind faith is some sort of make-beleive ghost up in the clouds i presume) But I was already working in high paid jobs before i started uni as a mature age student (i am also supported by my same sex partner who turns over close to half a million dollars a year in his resteraunt)

You may be socialized to believe that one is taxed 10% of their wage purely for health care, but it is not true. We pay just as many taxes as anyone else in the world.

I read an interesting piece in a Political Journal stating that the majority of Americans think a 'communist' is someone who hates god. Oh how i laughed.

Much the same as your parents and your parents parents handing down beliefs that socialized health care systems are horrible things that Americans simply do not want or need.