In the often-heated debate over tort reform the early part of this decade, proponents of the issue used two rallying cries to advance their cause. Tort reform, they said, would improve Mississippi’s business climate and aid job creation efforts, and it would ensure that doctors were not run out of the state due to the cost of medical malpractice insurance premiums.
Before tort reform earned passage in the Mississippi Legislature in 2004, the state’s largest provider of medical malpractice insurance promised that it would lower rates if the issue became reality.
Medical Assurance Company of Mississippi (MCAM), Mississippi’s largest underwriter of medical malpractice insurance, has made good on its word.
The Ridgeland insurer announced in late February that it was cutting its rates 20 percent across the board for 2009. This marks the fourth consecutive year MACM has reduced its rates.
“Once again, Mississippi doctors are seeing relief from high insurance bills thanks to meaningful tort reform in 2004,” said Republican Gov. Haley Barbour, who made tort reform one of his central campaign issues in his 2003 race against former Democratic Gov. Ronnie Musgrove. Barbour called lawmakers into a special session in 2004 with tort reform as the only item on the agenda.
The 20 percent reduction stands in stark contrast to the company’s announcement in early 2003. Then, MACM said it was imposing a moratorium on writing new medical malpractice policies because the policies already on the books were costing it too much money.
The moratorium was lifted in June 2005, a year after tort reform passed. Even though the company would begin writing new policies, rates would hold steady, which was the first time in several years MACM had not raised its rates because of claim losses.
With 2005 rates left unchanged, premiums started falling in 2006, when rates were cut five percent.
That number doubled in 2007 when MACM cut its rates 10 percent across the board. That cut came in spite of the flurry of medical malpractice lawsuits that were filed in late 2002 to avoid limits on what plaintiffs could seek that took effect in 2003.
In 2008, rates were cut at 15 and a half percent.
Starting in 2005, physicians insured by MACM received a refund on their premiums every December that ranged from 15 percent to 25 percent.
The 20 percent rate reduction for 2009 represents the largest cut MACM has made since tort reform legislation passed. It returns the premiums doctors pay to levels that are comparable to those of 2002.
“As was the case in previous years, the driving force behind this reduction was continued decreases in losses and loss adjustment expenses,” said MACM president and CEO Michael Houpt.
Mississippi Commissioner of Insurance Mike Chaney praised MACM’s rate reductions and premium refunds the past four years.
“As an example, if a physician paid $10,000 in premium in 2004, that same physician would pay just $5,780 today as a result of fours years of rate reductions by MACM,” he said. “In addition, this physician would have received refunds of premium totaling almost $7,000 during this same time period.”
Also seeing an increase is the number of physicians MACM insures. From the end of 2002 to the end of 2008, that number grew by five percent.
“These additional physicians are now living and practicing in Mississippi and helping provide the healthcare that is so essential to a better quality of life for all Mississippians,” Barbour said, adding in a statement that tort reform, along with making it more affordable for doctors to practice, has increased accessibility to healthcare in the state.
Contact MBJ staff writer Clay Chandler at firstname.lastname@example.org .