- The Washington Times - Friday, January 3, 2003

Medical malpractice lawsuits continue to cause anxiety among the nation's surgeons, in some cases leading to strikes such as the current one in West Virginia, although solutions remain elusive because insurance issues vary from state to state.
"Insurance is a bastion of states' rights. You've got 50 different sets of regulations, and it's difficult for any one insurance company to meet all those regulations," said Barry Swicker, a New York City broker who specializes in finding insurers for "non-standard" doctors who have weathered tough lawsuits or had disciplinary problems.
One of the biggest national insurers was the St. Paul Cos., which covered 9 percent of the nation's doctors when it quit the business outright a year ago.
"In 2001 alone, we lost $1 billion on this business even though we had been getting rate increases," St. Paul spokesman Pat Hirigoyen said yesterday. That was the fifth year in a row the company claimed losses on malpractice policies.
Medical organizations and lawyers seem to view medical malpractice lawsuits in vastly different lights.
"Everybody's crying, and everyone's a little bit right. Trial lawyers say it's lousy doctors, doctors say it's greedy trial lawyers, insurance companies blame everyone else," Mr. Swicker said.
American Medical Association President Donald J. Palmisano says runaway juries are driving good doctors out of the profession because they can't afford insurance.
"Unfortunately, our medical-liability litigation system has become an increasingly irrational lottery driven by open-ended, noneconomic damage awards," said Dr. Palmisano, a New Orleans surgeon who, like many tort-reform advocates, wants to cap punitive awards.
Mary E. Alexander, president of the Association of Trial Lawyers of America, yesterday blamed insurance companies and said they have too much control over the nation's health care system.
"Insurers place profits over people and threaten the livelihood of America's doctors," said Ms. Alexander, a San Francisco-based personal injury lawyer. "It's unfair to ask patients to give up their legal rights so the insurance industry can make higher profits."
In June, Dr. Palmisano testified to Congress that the crisis threatened health care in Florida, Mississippi, Nevada, New Jersey, New York, Ohio, Oregon, Pennsylvania, Texas, Washington and West Virginia. He said six other states were on the verge of a crisis because of the proliferation of medical malpractice lawsuits.
Since then strikes that doctors call "curtailment of service" occurred in Nevada in July, and one is now taking place in West Virginia. Pennsylvania came within hours of a walkout that Gov.-elect Ed Rendell headed off Tuesday by promising to seek 40 percent cuts in top malpractice premiums, with some reductions for all.
Almost two dozen hospitals in the Philadelphia area had prepared to shut emergency rooms and stop elective surgery.
In West Virginia, four hospitals transferred patients yesterday because more than two dozen orthopedic, general and heart surgeons took 30-day leaves of absence to dramatize the need to reduce insurance premiums. They seek laws to limit large judgments, which they argue would eventually make insurance more affordable.
Opponents of such caps often cite cases such as the lawsuit Charles Algeri filed recently in Boston against Dr. David Arndt for suspending surgery and leaving his patient on the operating table for 35 minutes while he rushed to deposit a paycheck before his bank closed.
On July 4, Las Vegas' only trauma center for the city of 1.5 million shut down after private orthopedic surgeons refused to work as a protest over high jury awards. Critically injured patients were airlifted to hospitals in California, Arizona and Utah.
The U.S. Senate voted 57-42 in late July to kill an amendment that sought to cap malpractice lawsuit awards and contingency fees for lawyers.
In the first major malpractice verdict after Nevada enacted tort reform, a jury awarded $4 million to Josephine Fasolini, 66, in August because vaginal surgery by gynecologist Deborah Gold left her unable to have sex with her 66-year-old husband.
The Fasolinis' lawyer, Bob Vannah, called it a "just absolutely phenomenal" win in the wake of the doctors' strike.
A New York interest group called Americans for Insurance Reform (AIR) rejects the arguments of the insurance industry and offers alternative explanations for the standoff, saying premiums in the past 30 years were not founded on valid actuarial factors.
"Medical malpractice payouts have directly tracked the rate of medical inflation and, second, over the same period, insurance premium rates have not tracked payouts at all such as jury verdicts, settlements, etc., but instead directly follow the ups and downs of the economy," said a study summary furnished yesterday by AIR spokeswoman Lisa Cohen.
Disagreeing with that, Mr. Hirigoyen said the St. Paul Companies found it impossible to predict the continually climbing costs of insuring some 17,000 doctors.
"We decided that it was really too difficult to determine what future costs were going to be. It's very unpredictable," Mr. Hirigoyen said.
Even when insurance companies succeed in defending a case, lawyers' bills can run $200,000 or more.
However, the position of the American Medical Association is backed by data from the publication Jury Verdict Research, which shows that median judgments rose 43 percent from 1999 to 2000 and that the average jury award rose to $3.5 million.
Medical Liability Monitor, a publication that tracks malpractice insurance rates, found premium medians increasing less than jury verdicts through July 1.
Median rate increases nationally were 29.1 percent for general surgeons, 17.6 percent for internal medicine specialists, and 12.5 percent for obstetricians/gynecologists. Average increases respectively by specialty were 25 percent, 24.7 percent and 19.6 percent.
In extreme cases, premiums for a single doctor have soared to more than $200,000 a year. But Dr. Cliff Callaway in Charlotte, N.C., survived a more typical scare when his insurer refused to renew the $53,000 a year policy covering him and nine other doctors at his chain of six urgent-care clinics. One company offered to cover the risk for $350,000 a year. Eventually the original insurer renewed for about $95,000.
The biggest regional effect of increases has been felt in a few major cities, with surprise jumps in Las Vegas, West Virginia and the Rio Grande Valley, said editors at Medical Liability Monitor. Only Alabama and Alaska had no increase in rates.

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