Monday, May 06, 2002

OB-GYNs: Insurance costs could provoke crisis

The Associated Press

        LOS ANGELES — Doctors specializing in obstetrics and gynecology warn that skyrocketing insurance premiums, driven by a leap in jury awards, threaten their ability to care for women and newborns.

        Steep hikes in premiums have made medical liability insurance unaffordable or unavailable for many OB-GYNs, especially in nine “hot” states where costs have tripled or quadrupled in recent years.

        “Without insurance, OB-GYNs are forced to stop delivering babies, stop surgical services or close their doors,” said Dr. Thomas Purdon, president of the American College of Obstetricians and Gynecologists. “Women and newborns are hurt the most.”

        OB-GYNs said insurance costs are rising fastest in nine states: Florida, Mississippi, Nevada, New Jersey, New York, Pennsylvania, Texas, Washington and West Virginia.

        The college, meeting this week in Los Angeles, is hoping for state and federal tort reform. Doctors cite California, which in 1975 capped noneconomic damages in jury awards, as a model for legislative action. The American Medical Association made a similar plea for relief in March.

        Insurers consider obstetrics and gynecology high-risk specialties, and price their coverage accordingly. Annual premiums cost as little as $12,000 a year in Nebraska but as much as $209,000 in Florida's Dade and Broward counties.

        And rates continue to rise: the median annual premium rose 12.5 percent last year and is expected to rise an additional 15 percent this year, officials said.

        Dr. Joseph Apuzzio said insurance premiums for OB-GYNs in New Jersey, where he practices, jumped from a typical $40,000 to twice that for doctors whose policies came due last January.

        “And these are not people who had cases against them either,” Apuzzio said. Rather than pay the increased premiums, doctors are retiring early, moving out of state or stopping delivering babies.

        “It's not worth it,” he said.

        Doctors blame the increases in part on rising jury verdicts in medical malpractice cases.

        The median medical practice award hit $1 million in 2000, twice what it was in 1995, according to Jury Verdict Research.

        In childbirth cases, the median award between 1994 and 2000 was $2 million, more than any other of the most commonly claimed medical liability situations, according to the Horsham, Pa., company.

        Carlton Carl, a spokesman for the Association of Trial Lawyers of America, said the increased cost of medical care and the cyclical nature of the economy prompted the rise in premiums.

        “The problem is clear, all you have to do is look at history. In the 1970s and the 1980s and the 1990s and again today, there have been increases in premiums, not just in medical malpractice but across the board, whenever the economical cycle has taken a downturn and insurance companies have lost significant revenue from their investments,” Carlton said.

        One-quarter of medical liability insurers rate D-plus or worse, suggesting serious financial problems, according to the Physicians Insurers Association of America.

        The St. Paul Cos., the nation's second-largest malpractice insurer, said in December it had lost nearly $1 billion in 2001 — including as much as $108 million in the collapse of Enron — and would no longer renew policies for 42,000 doctors nationwide.

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- OB-GYNs: Insurance costs could provoke crisis