Medical malpractice insurance getting cheaper in many states

September 23, 1990|By New York Times News Service

WASHINGTON -- After rising sharply for more than a decade, medical malpractice insurance premiums are now declining in many states around the country.

Premiums are showing declines of 5 percent to 35 percent as states have set limits on malpractice lawsuits and as doctors, faced with the possibility of damage claims in the millions of dollars, have apparently become more careful.

Medical Liability Mutual Insurance Co. of New York, which is owned by doctors in the state and is the second biggest writer of malpractice insurance in the nation, has just reduced rates by an average of 5 percent.

"That's the first time our rates have gone down since the company was founded in 1975," said Donald J. Fager, company vice president.

Another insurer, St. Paul Fire & Marine Insurance Co., the largest source of malpractice insurance in the United States, is reducing premiums in 22 of the 42 states where it writes policies for doctors.

Beth M. Hamel, a spokeswoman for the company, which insures 30,000 doctors, said the cuts ranged from 6 percent to 25 percent.

Experts list several reasons for the decline in malpractice premiums.

Lawsuits have prompted doctors to act aggressively to prevent injuries. Some specialists, such as anesthesiologists, have adopted standards of patient care requiring new safeguards.

In cases where the injury was deemed preventable, the patient recovered an average of $494,000 by filing a malpractice claim.

Under a standard adopted this year, the American Society of Anesthesiologists requires members to use certain monitoring devices.

Many insurers have recognized such efforts by reducing premiums for anesthesiologists.

Dr. James S. Todd, executive vice president of the American Medical Association, said about 55 percent of doctors in private practice were now insured by doctor-owned companies.

About half the states have adopted laws limiting the amount or type of damages that can be recovered in malpractice lawsuits.

Hospitals, state government agencies and the federal government are also making more systematic efforts to identify doctors with a history of malpractice.

As a result of such actions, malpractice insurance premiums have declined dramatically in some states.

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