|FOR IMMEDIATE RELEASE|
DECEMBER 20, 2004
|CONTACT: Americans for Insurance Reform
Joanne Doroshow, Laurie Beacham, 212-267-2801
J. Robert Hunter, 703-528-0062
Insurers Continue to Price-Gouge Doctors in Massachusetts Despite Dropping Medical Malpractice Payouts
NEW YORK, NY -- December 20 -- With the issue of medical malpractice and tort reform becoming an increasingly discussed topic, Americans for Insurance Reform (AIR) announced today the release of a comprehensive new study of medical malpractice insurance in Massachusetts, based on the insurance industrys own data. Its findings may be startling to some:
According to Joanne Doroshow, Executive Director of the Center for Justice & Democracy and AIR co-founder, These findings undermine one of the central claims of interest groups who seek to blame the legal system for doctors insurance woes. In fact, the study shows that the causes of and solutions to this crisis lie not with the legal system (i.e., tort reform) but with reforming regulation of the insurance industry, which has been unfairly charging doctors excessive rates to make up for their own investment losses.
The study by AIR, a national coalition of over 100 consumer and public interest groups representing more than 50 million people, including the New England Patients Rights Group, Massachusetts Public Interest Research Group and the Massachusetts-based Center for Insurance Research, makes nearly identical findings to those reached in a recently-released AIR study of national trends. Specifically, the national and Massachusetts studies show that the real reasons medical malpractice insurance rates have risen so dramatically in the last two years are market forces and dropping interest rates not, as the insurance industry claims, because of a sudden massive increase in medical malpractice jury awards or payouts, which, in constant dollars, have been decreasing for the last decade.
Hunter said, There is only one way to solve this problem: reforming the insurance industry. State lawmakers must strengthen state insurance laws in order to end the boom and bust swing from illegal overpricing, such as the rates doctors are being asked to pay today, to illegal and inadequate underpricing, which will be seen when the market softens later in the cycle. Fortunately, the hard market price jump is behind us and we are now entering the softer market so legislators have a decade or so to grapple with how best to do this before the next hard market hits the nation.
The full study can be found at: http://insurance-reform.org.