Insurer defends malpractice rates

St. Louis Post-Dispatch
Monday, November 14, 2005

Illinois' new law limiting jury awards in medical malpractice cases quietly was put to the test on Sept. 27 and again last Wednesday beneath the glare of fluorescent lights in a windowless fifth-floor conference room here.
For the first time, representatives of the ISMIE Mutual Insurance Co., which controls more than 60 percent of the state's market for medical malpractice insurance, were required to defend their rates for the current fiscal year in sworn testimony before the state's Division of Insurance.

Representatives of consumer groups who sat through the testimony said they were frustrated that ISMIE declined to commit to a significant rate cut.
"ISMIE had promised when the bill was being debated that when the state capped damages, medical malpractice insurance rates would go down," said Brent Adams, policy director for Citizen Action/Illinois, a consumer watchdog group that opposed capping jury awards. "At the hearing, they made clear that they have no intention of keeping that promise."
Amber Hard, staff director for another watchdog group, the Center for Justice and Democracy Illinois, said she had similar concerns. But she applauded the insurance hearings, which are based on similar proceedings in California and 14 other states that claim some control over the way that malpractice insurers set their rates.
"More disclosure means more scrutiny means more accountability," Hard said. "It's also a chance for regulators to ask the insurance companies some pretty hard-hitting questions under oath, which is the first time that's happened."


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