Medical malpractice insurance costs ease in Pa.

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    For more than a decade, doctors in Pennsylvania have complained bitterly about the high cost of  medical malpractice insurance.


    “Depending on your specialty, it’s a costly part of doing business, of practicing medicine in Pennsylvania,” said ear, nose and throat specialist Karen Rizzo. She is president the Pennsylvania Medical Society.

    “Our malpractice insurance premiums are a big part of the reason why we have a difficult time retaining our young talent and keeping our more experienced doctors in the state,” Rizzo said.

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    Now, Gov. Tom Corbett says the medical malpractice environment is improving for doctors in Pennsylvania.

    Among the fixes, he’s touting a string of recent legislative changes.

    Rizzo says a 2002 law made a practice called “venue shopping,” in which patients tried to get their lawsuits moved to a jurisdiction where there might be a generous jury, much harder to accomplish.

    “In the past, something [a medical malpractice incident] may happen, let’s say in Harrisburg, but the attorneys tried to get the case presented in Philadelphia,” Rizzo said. She said that led to enormous — and inappropriate — payouts to patients, while pushing up the cost of malpractice insurance for doctors.

    She also credits a law that tightens up the rules about who can testify as an expert witness during a medical malpractice trial.

    Doctors are required to carry $1 million in medical liability insurance. Years ago, the state set up a Medical Care Availability and Reduction of Error Fund, or MCARE, to allow doctors to buy half of that coverage through the state at a lower price than what’s available through the private market.

    Big dip in assessments expected

    The amount of money a doctor pays into the MCARE fund — called an assessment — varies depending on location and specialty. Next year, according to the Corbett administration, the price will fall by 48 percent.

    According to a state Insurance Department statement, “a neurosurgeon in Philadelphia, who paid $36,447 in 2014, will pay $19,016 in 2015. A family physician in Philadelphia, who paid $5,054 in 2014, will pay $2,637 in 2015.”

    Widener University law professor John Culhane gives some of the credit for falling costs to Pennsylvania’s Fair Share Act.

    “The Fair Share Act basically says that a health care provider can only be responsible for their share of fault regarding a patient’s injury. And that’s really seen as a deterrent to people bringing suits looking for a deep pocket,” said Culhane, director of Widener’s Family Health Law and Policy Institute.

    That law was passed in 20111, and Culhane said it has had some time to make a difference.

    On the other hand, the new “Apology Law,” hasn’t been that effective. Passed in late 2013, it allows doctors to say “I’m sorry” without those words being used against them in court.

    While the rule may do some good for the relationship between doctors and patients, Culhane said, it probably hasn’t done much to drive down the cost of medical malpractice insurance.

    “There’s really no evidence, when you look at other states, that apology laws have any effect at all,” he said.

    In analyzing the medical malpractice environment in Pennsylvania, Culhane said another consideration is the influence of systemwide efforts to reduce medical mistakes.

    “It’s going to be hard to sort of sort out what really is causing these drops in insurance premiums,” he said.

    Next year, Pennsylvania doctors will pay less for medical malpractice insurance purchased through MCARE, but part of the lower cost is a result of overpayments in years past.

    Back in 2008, there was a huge surplus sitting in the fund. Doctors had paid in more in assessments than was used on malpractice claims.

    “The commonwealth we felt raided that fund — and took $100 million of our money to balance the budget,” Rizzo said.

    Rizzo says doctors were outraged, so the Medical Society sued Pennsylvania. Last month the state and the doctors group settled the case, and doctors across Pennsylvania will be getting refunds.

    “It could range from anywhere from $2,000 for a primary care doctor, to a neurosurgeon or OB/GYN, who had much higher payments, could range in the $10, 000 to $15,000 range,” Rizzo said.

    The Medical Society also negotiated a change to how the MCARE fund works.

    From now on, the pool of money collected from doctors will be a “pay-as-you-go” pot of money. The state is not allowed to let a huge reserve build up again.

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