NO MORE CRISIS….Good news! The medical malpractice “crisis” is over. The fine folks at Americans for Insurance Reform have tabulated recent increases in malpractice premiums and found that after the big upsurge of a few years ago, rates aren’t going up anymore:
Contrary to the medical and insurance lobbies? message ? that medical malpractice lawsuits and claims were to blame for the increase in insurance rates ? the fact is that in 2001, commercial property insurance rates jumped across the board. In other words, rate hikes for doctors were only a small part of a much larger insurance problem that affected homeowners, motorists and all kinds of policyholders.
….These kinds of volcanic eruptions in insurance premiums have occurred three times in the last 30 years ? in the mid 1970s, again in the mid-1980s, and then again following the year 2001. The cause is always the same: a severe drop in investment income for insurers compounded by underpricing in prior years. Each time, insurers and the health care industry have tried to cover up their mismanaged underwriting by blaming lawyers and the legal system. To buy this position, one would have to accept the notion that juries engineered large jury verdicts in the mid-1970s, then stopped for a decade, then engineered large verdicts again in the mid-1980s, stopped for 17 years and then did it again beginning in 2001 ? only to stop once again. Of course, this is ludicrous and untrue.
They also found no correlation between rate increases and imposition of caps on damages. No surprise there.