Medical crisis: Malpractice premiums on a rocket ride

Atlanta Journal-Constitution
Sunday, August 11, 2002

Here at the headquarters of the Ty Cobb Health System, a consortium of three rural Northeast Georgia hospitals and three nursing homes, CEO Chuck Adams labored over his budget. Knowing that malpractice premiums were rising for everyone in the industry, he earmarked enough money for a 100 percent increase.

The bill arrived by fax this summer, just 24 hours before a check was due. Not only was the insurance company increasing his deductible tenfold, but the premium jumped from $553,000 to $3.15 million --- a 469 percent increase.

"We were numb," said Adams, who eventually got an extension, then another cheaper policy at $1.65 million. "There goes our expansions like a renovation of the Hart County Hospital emergency room."


But Joanne Doroshow, with the Center for Justice and Democracy in Washington, said her research showed that the cap on damages isn't working. She said California premiums between 1990 and 2000 increased 3.5 percent compared with 1.9 percent nationally. In the past two years premiums have jumped as much as several hundred percent depending on the medical specialty.

"The noneconomic damages pay for everything other than medical expenses," she said. "It assists the family with housing and transportation and other needs. A cap won't do anything to affect the affordability of insurance."

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

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