Malpractice claims rise slightly, study finds

Business Insurance
Thursday, October 18, 2001

Medical malpractice claim costs have risen slightly in the past 10 years, according to a new study.

The average cost of a medical malpractice claim stood at $42,607 in 2000, up from $26,846 in 1993. In 1991, the average cost of a medical malpractice claim was $39,093. The study, on behalf of the Center for Justice & Democracy and conducted by J. Robert Hunter, director of insurance for the Washington-based Consumer Federation of America, concludes, “there is no explosion in claim severity.”

Mr. Hunter examined data from the National Assn. of Insurance Commissioners and A.M. Best Co. on the number of medical malpractice claims and the amounts insurers paid to close the cases from 1991 through 2000.

The study also examined premiums paid for medical malpractice insurance and concludes that premiums as a percentage of overall health care costs stand at a10-year low. Only 0.55% of total U.S. health care costs were spent on medical malpractice premiums in 2000, down from 0.65% in 1991, the study shows.

The study disputes insurers’ contentions that higher premiums are needed to offset rising verdicts, said Joanne Doroshow, executive director of the nonprofit Center for Justice & Democracy in New York.

“Several factors having nothing to do with lawsuits are to blame for possible rate increases nationwide, including earlier underpricing by insurance companies, rapidly changing consumer markets and the nation’s conversion to managed care,” she said in a written statement.

For a copy of the complete article, contact CJ&D.

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