Want to cure high malpractice rates? Target bad doctors
- From: rpautrey2 <rpautrey2@xxxxxxxxx>
- Date: Fri, 1 Aug 2008 09:31:59 -0700 (PDT)
July 29, 2008
Want to cure high malpractice rates? Target bad doctors
Eric Turkewitz
Re "Tort reform needed in New York state," a July 23 letter by Cortes
E. DeRussy of Bronxville that blamed the "trial-bar friendly state
Legislature" for refusing to enact malpractice reforms needed to keep
doctors from fleeing the state:
The DeRussy letter repeated a common myth in an argument for tort
"reform," claiming that one of the primary reasons for increased
medical malpractice insurance was "unusually high judgments." DeRussy
couldn't be more wrong. Last year doctors in the state were hit with a
14 percent increase in medical malpractice rates. The instinct among
those who want to change the tort laws by granting some level of
immunity or protection to the wrongdoers was to blame the lawyers or
juries. A little protectionism called tort "reform" in the way of
artificial caps on awards would surely cure this problem. Right?
Except that medical malpractice verdicts had nothing to do with the
increase in rates. Rather than make simple conclusory statements,
let's look at some actual facts:
New York Superintendent of Insurance Eric R. DiNallo, who sets the
amount of rate increases, said last year that the 14 percent jump
comes "after years of artificially low rate increases" and that "the
rate increase comes after years of setting rates below what was
needed." The rates were raised in order to avert a possible
"irreversible crisis." Did doctors previously complain that their
rates were too low?
New York had previously "appropriated" $691 million of medical
malpractice insurance reserves from the Medical Malpractice Insurance
Association to balance the state budget. This association had been
established by the state to satisfy any deficiencies attributable to
the premium levels for malpractice policies, and for reinsurance. That
surplus would have been used (if not taken during the Pataki
administration to balance the state budget) for maintaining the
solvency of New York's medical malpractice insurance carriers.
OK, so the problem was caused by lousy state policy under the Pataki
administration by setting artificially low rates, while also swiping
the doctors' rainy day fund. Surely, the problem was also caused in
part by increasing medical malpractice cases and payouts, right? Well,
no. In fact a study has shown that the number of medical malpractice
cases in New York has remained static, and the amount of payouts has
kept pace with other health-care costs. When premiums go up, but the
payouts are flat, you know you have a problem. But that is not problem
that was created by those who were injured by negligence, nor by their
counsel.
And have high medical malpractice insurance rates in downstate
counties chased away physicians, as the fear-mongers suggest? Not even
close. It seems that the number of doctors in New York jumped by 16
percent from 1995-'03, an increase greater than our growth in
population. And The New York Times reported just last year that while
there was a 6 percent growth in the number of doctors from 2001 to
2005, for a total of about 77,000 doctors, the way they are spread
throughout the state is wildly uneven.
Perhaps the problem is an onslaught of frivolous litigation? Nope, not
that either. A report in the New England Journal of Medicine disproves
the myth of frivolous malpractice litigation. Here's a suggestion for
tort "reformers" like DeRussy, who wish to create artificial one-size-
fits-all caps for the victims of negligence: Government clearly
created this insurance problem, as DiNallo admits. We, therefore, need
insurance reform. Trying to fix a government-created problem on the
backs of the most badly injured New Yorkers is not only cruel, and not
only lousy policy, but it also won't work. For it wasn't the victims
who created the problem. (It's worth noting, by the way, that New York
already has caps on personal injury awards, including medical
malpractice.)
Now here is a reform that the doctors may want to entertain: With up
to 98,000 people per year dying from medical errors according to the
Institute of Medicine, and with 4 percent of the state's doctors
contributing to half of the malpractice suits and payments (according
to a Public Citizen report) maybe, just maybe, a little more policing
of the medical profession might be in order to weed out the bad
apples?
A good way to start real reform would be to take the rainy day fund
money back from the general fund where it had disappeared. That means,
however, a responsible state government engaging in sound budgetary
policy instead of shell games. Better policing of the few doctors who
do most of the damage is the second avenue that the state must embark
upon, and not just for the sake of insurance premiums but for the sake
of future patients who may come under their care.
The writer, who lives in New Rochelle, is a Manhattan attorney and the
author of the New York Personal Injury Law Blog.
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