Anyone wondering about whether or not medical liability coverage has changed since judicial reform was enacted in Mississippi should ask Dr. Dwalia South’s opinion.
“Put simply, tort reform works!” the Ripley family physician said. “Two major changes in the judicial climate prove that the 2004 tort reforms work. The cost of professional liability insurance has dropped five times in three years, and the number of claims against physicians has dropped 90% in three years.”
South, who currently serves as president of the Mississippi State Medical Association, says that trend is due directly to the passage of tort reform. Mike Houpt, president and CEO of Medical Assurance Company of Mississippi (MACM), the state’s largest insurer of physicians, confirms that losses are down dramatically and that rates have been reduced and premiums refunded for the last several years.
Across the board improvements
“It’s been an improvement across the board for physicians in all specialties,” he said, “and I think 2008 will be a good year. I see nothing on the horizon that would swing it back the other way. The system is more balanced now.”
Houpt points out that 2005 was the first year MACM did not raise rates and by December of that year was able to refund 15% to all the insured policy holders. That trend continued with a 5% premium reduction and 20 percent refund in 2006; a 10% premium reduction early in 2007 and a 25% refund and a 15.5% premium reduction for 2008. The not-for-profit company will continue to pass along reductions to policy holders.
“Physicians are very happy,” he said. “We’re seeing a lot of applications of physicians coming into the state. Our number of policy holders did increase in 2007, and it had been holding steady for a few years.”
The Mississippi Hospital Association (MHA) agrees that reform has made a significant difference for its members. “Tort reform provides a forum in which to resolve disputes with fairness and within reason,” said Cheryn Baker, the group’s counsel and vice president for government relations.
Going forward, the MHA wants to protect tort reform by keeping the voters advised of the abuses and corruption that flourished in the pre-tort reform legal system, keep the Legislature focused on the fairness of the current system and keep courts fair and accountable.
Chip Morrow, an attorney with the Butler, Snow, O’Mara, Stevens & Cannada law firm, defends physicians and hospitals in malpractice claims.
“My overall impression is that tort reform is having a positive impact,” he said. “Now, insurance companies are coming back in to the state to write policies. It’s getting better. It’s not anything like it was in 2001, 2002 and 2003.”
He recently won a malpractice case in federal court in Greenville, noting that times have changed. “Everyone is more aware of what’s going on in Mississippi,” he said. “There’s been a very big and positive impact that has resulted in fewer lawsuits. If people think they’ve been harmed, they will file a suit, but we don’t have 200 lawsuits filed in one county, and we don’t have out-of-state people coming to Mississippi to file suits.”
Running the numbers
South looks back to pre-tort reform days when rates increased 12% in 2000, 11% in 2001, 10% in 2002, 54% in 2003 and 19% in 2004.
“That meant an obstetrician’s $40,000 premium skyrocketed to $100,000 in four years,” she said. “We have physicians in Mississippi that don’t take home $100,000 a year.”
Now, she is pleased that the state’s physicians can once again have faith in the judicial system. “Doctors in Mississippi can now get liability coverage at rates equal to or below premium costs in 2003,” she added. “Furthermore, the number of claims against physicians has dropped by 90% since 2004 and that spells success for physicians across the state.”
Houpt says physicians appreciate the positive changes. “They thank us for the refunds and tell us to keep up the good work,” he said. “We’ve always had a good book of business, and apparently losses are down for most companies.”
The cap on the non-economic damage award has played a significant difference in litigation, Baker feels. “This removes the risk of a runaway jury, which can award a multi-million-dollar award against a non-liable defendant for minor damages,” she said. “We have a good, fair system now. People with legitimate claims can still recover expenses they can document. There is no cap on those economic damages. The biggest benefit is that we don’t see as many frivolous cases now.”
Contact MBJ contributing writer Lynn Lofton at email@example.com.