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PLUS Medical PL Symposium 2003

PLUS Medical PL Symposium 2003. PLUS Medical PL Symposium. Doctors Strike. “Hype outraces facts in malpractice debate”. March 5, 2003. Who’s Right??? Physicians/Companies/Trial Bar. Increased loss cost are driving rates Stock market losses are driving the rate increases

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PLUS Medical PL Symposium 2003

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  1. PLUS Medical PL Symposium 2003

  2. PLUS Medical PL Symposium

  3. Doctors Strike “Hype outraces facts in malpractice debate” March 5, 2003

  4. Who’s Right??? Physicians/Companies/Trial Bar • Increased loss cost are driving rates • Stock market losses are driving the rate increases • Companies say average severity and loss cost going up • Robert Hunter study “Public Citizen” claims cost has not changed over the last 10 years • Trial bar contends that poor insurance management is the problem • Insurance companies and doctors contend that greedy plaintiff attorneys are the problem • Tort reform - $250,000 cap non-economic damages, MICRA is the answer • Proposition 103, improve patient safety is the answer

  5. Effects: “Red” Zones Access Threatened • MDs Migrating • Defensive Medicine Lead Carriers Exit • St. Paul • MIXX • PHICO • Frontier • Severity Magnified in XS AMA: Availability Issues Are Real

  6. Medical Malpractice – Combined Ratio Source: AM Best, Conning, Insurance Information Institute

  7. Medical Malpractice: Losses & ExpensesPaid versus Premiums Earned Over the period from 1996 through 2001, premium earned rose 16.8% while losses and expenses rose 68.9% Source: Computed from A.M. Best data by the Insurance Information Institute

  8. Medical Malpractice: Underwriting Losses Med Mal underwriting losses exploded by $2.7 billion or 938% between 1996 and 2001! Source: Insurance Information Institute calculations based on data from A.M. Best.

  9. Medical Malpractice: Cumulative Underwriting Losses The cumulative underwriting loss in Med Mal from 1990-2001 totals nearly $10 billion! Source: Insurance Information Institute calculations based on data from A.M. Best.

  10. Driver: Increasing Awards Avg. Med Mal Jury Awards ($ Millions) Source: Jury Verdict Research, Insur Info Instit • Incident to Trial Cycle Time……….Down 20% since 1994 • Indemnity Pmts > $1MM……………+100% since 1999 • Settlement Costs Rising Too………+30% 1988-1999 • Physician Limits……………………..Stagnant for 15 years Severity and frequency of awards and settlements escalating costs

  11. Claims Payments => $1 MillionPIAA Data Sharing Project % of Paid Claims 7.9% Year

  12. California Premiums Low w/Tort Reform Data From “Medical Liability Monitor” 2001 Premium Survey Data for Selected Specialties $1 million/$3 million limits Los Angeles rate: NORCAL Mutual Insurance Company New York rate: Medical Liability Mutual Insurance Company Chicago rate: Illinois State Medical Insurance Services, Inc. Miami rate: First Professional Insurance Company

  13. Physicians and Surgeons Moderator: E. Dow Walker, CPCU, ARM, ARe, ChairmanWillis Healthcare Practice (Nashville, TN) Panelists: David J. Kalainoff, Senior Vice PresidentTransatlantic Reinsurance Co (New York, NY) James A. McGuire, Esq., PartnerMendes & Mount LLP (New York, NY) David Murray, President & CEOMedical Mutual Liability Insurance Society of Maryland (Hunt Valley, MD) Mary Hedin, Vice PresidentMICA (Phoenix, AZ)

  14. PLUS MPL Symposium 2003

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