Health Care Debate: True Risk – The Americans for Insurance Reform Study

For years, some doctors and insurance companies have been telling us and our government that unless frivolous medical malpractice lawsuits are curtailed, and unless out-of-control verdicts are limited, doctors will be driven out of practice by high malpractice insurance premiums. Their efforts have been very successful in Virginia, where doctors enjoy the privileges of a special class, exempting them from being held responsible for the consequences of their negligence.

Throughout this conflict, your attorneys at The Allen Law Firm have worked hard to correctly inform the public and to continue to champion the old-fashioned value of personal responsibility for everyone, including negligent physicians. Now, a new study proves – yet again – that medical malpractice victims have been unfairly burdened for the benefit of insurance companies and not to help doctors.

Americans for Insurance Reform recently released a new study called True Risk: Medical Liability, Malpractice Insurance and Health Care. It is co-written by actuary J. Robert Hunter, Director of Insurance for the Consumer Federation of America, and former Federal Insurance Administrator and Texas Insurance Commissioner. The full study is available for download by clicking here.

Its major findings are:

  • Medical malpractice premiums, inflation-adjusted, are nearly the lowest they have been in over 30 years.
  • Medical malpractice claims, inflation-adjusted, are dropping significantly, down 45 percent since 2000.
  • Medical malpractice premiums are less than one-half of one percent of the country’s overall health care costs; medical malpractice claims are a mere one-fifth of one percent of health care costs. In over 30 years, premiums and claims have never been greater than 1% of our nation’s health care costs.
  • Medical malpractice insurer profits are higher than the rest of the property casualty industry, which has been remarkably profitable over the last five years.
  • The periodic premium spikes that doctors experience, as they did from 2002 until 2005, are not related to claims but to the economic cycle of insurers and to drops in investment income.
  • Many states that have resisted enacting severe restrictions on injured patients’ legal rights experienced rate changes (i.e., premium increases or decreases for doctors) similar to those states that enacted severe restrictions on patients’ rights, i.e., there is no correlation between “tort reform” and insurance rates for doctors.