Study contends insurers gouging; Malpractice claims versus premiums; But industry says report is flawed

Kansas City Star
Friday, July 8, 2005

Medical malpractice insurers in recent years have reaped a windfall in premiums that have far outstripped their claim payouts, a report issued by consumer groups said Thursday.
The report, written by former Missouri Insurance Commissioner Jay Angoff, contends that the amount of premiums collected by 15 major medical malpractice insurers has more than doubled over the past five years. At the same time, the report found that the companies' claim payouts have remained essentially flat.
"This can be a hazard to all of our health," said Richard Blumenthal, Connecticut attorney general, in a telephone news conference after the report was released. "We're dealing with a hurricane-force trend."
The insurance industry quickly disputed the study, saying it was based on a methodology that skewed the results in favor of critics.
The report, commissioned by the New York-based Center for Justice & Democracy, a consumer advocacy group, is the latest salvo in an ongoing controversy over one of the most contentious issues in health care.
The report said malpractice insurers as a group raised their net premiums between 2000 and 2004 by 120.2 percent, to about $4.2 billion, even though their net claim payments rose by only 5.7 percent, to about $1.4 billion.
As a result, the amount of claim payments made as a percentage of premiums dropped from 69.9 percent in 2000 to 33.6 percent in 2004.
In the news conference, Angoff and Blumenthal called for oversight of malpractice insurance premium increases in every state.
For a copy of the complete article, contact CJ&D

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