WIS. SUPREMES OK MED-MAL CAPS:
The Wisconsin Supreme Court unanimously affirmed the constitutionality of noneconomic damage caps in wrongful death medical malpractice cases. The Wisconsin Supreme Court concluded that "the limit on noneconomic damages in a medical malpractice wrongful death cases is constitutional." The court also reversed a circuit court decision that allowed plaintiffs to recover non-economic damages for both medical negligence and wrongful death. The Supreme Court concluded that "there is a single cap on noneconomic damages recoverable ... when a patient dies."
COMMISSION: MED-MAL CRISIS HURTING DOCTOR RECRUITMENT IN OHIO:
Patients in southeastern and northeastern Ohio are feeling the impact of the medical malpractice crisis according to several doctors who testified before the Ohio Medical Malpractice Commission at the Ohio Department of Insurance (ODI). Recruitment and retention efforts at some independent and university hospitals in those regions are suffering, as new doctors leave Ohio for more favorable medical liability premiums in other states, ODI said in a statement. Statistics cited in testimony before the commission showed that certain specialties, including obstetrician-gynecologists, have been hit particularly hard by the crisis. According to Dr. John A. Brose, dean of Ohio University College of Osteopathic Medicine, all five family physicians stopped delivering babies, one gynecologist left and two out of the three remaining surgeons in the Athens community in southeastern Ohio left since last year. Additionally, Brose testified that surgery for Medicaid patients is unavailable in the area for nonemergent care. Dr. James Dougherty, head of the medical education department at Akron General Hospital, testified that his hospital and other Akron-area hospitals are not only finding it difficult to recruit new doctors to practice in northeast Ohio, but retaining resident physicians is increasingly a challenge. According to Dougherty, only 43 percent (27 percent for Akron General) of residents now stay in northeast Ohio to practice medicine where 63 percent stayed in the area in 2002.
CONSUMER GROUPS KNOCK MICH. INSURERS' 'DISHONESTY' ON CREDIT SCORING:
Two consumer advocacy groups released a statement criticizing Michigan auto and homeowners insurers for "false statements" about insurance credit scoring and Gov. Jennifer Granholm's proposed regulation to ban the practice. The insurers criticized Office of Financial and Insurance Services (OFIS) Commissioner Watters for stating that the proposed ban on credit scoring will lower base rates with the new rule—at the same time the insurers are claiming that consumers will lose their discounts. Brian Imus, a lobbyist with the Public Interest Research Group in Michigan (PIRGIM) called industry lobbyists' statements "breathtaking" in their falsehood, and said that Commissioner Linda Watters' argument that banning the practice would reduce rates is "precisely correct" because "credit scoring is essentially a zero-sum game." The Austin, Texas-based Center for Economic Justice (CEJ), meanwhile, argued that insurers' use of credit scoring "is clearly prohibited by current Michigan law." Imus said the two groups welcomed any legal challenge of the rule by insurers, which he said were sure to fail. Birnbaum, meanwhile, praised Granholm's "political courage" for standing up to the "fearsome" financial and political power of the insurance industry.
PCI: MICH. BAN OUT OF STEP WITH OTHER STATES:
Meanwhile, leading insurance lobby the Property Casualty Insurers Association of America (PCI) said in state Senate testimony that Granholm's proposal is out of step with the 20 states that have adopted a variation of the model law developed by the National Conference of Insurance Legislators (NCOIL). PCI lobbyist Michael Harrold said "the NCOIL model provides many consumer protections while preserving an important and fair rating tool." He said Michigan should do the same, while criticizing the OFIS for failing to tell consumers that most of them will see rate increases if credit scoring is banned. Harrold said "there is a dramatic difference between the base rate in any territory and the average premium in that territory." He said most Michigan consumers would be worse off under a ban. Harrold cited House Bill 5803, a variation of the NCOIL model, as a "sensible alternative."
ISO: INSURERS TO PAY OUT $1.65 BILLION FOR Q2 CAT CLAIMS:
U.S. property/casualty insurers are expected to pay homeowners and businesses an estimated $1.65 billion for insured property-loss claims from six catastrophes affecting 23 states in the second quarter, according to preliminary estimates by Insurance Service Office's Property Claim Services (PCS) unit. This compares with insured losses of $5.1 billion in second-quarter 2003 and $2.8 billion in second-quarter 2002. The property/casualty industry posted its worst second-quarter for catastrophe losses in 2001, with a record $6.2 billion in insured damage. Catastrophe losses for the first half of this year now stand at $2.69 billion—the second lowest for insured losses during the past decade. The six-month period ended June 30 is also the second lowest in the decade for the number of catastrophic events—11. PCS estimates the six catastrophes in the quarter are expected to generate nearly 495,000 claims, of which more than 270,000 are from homeowners. Severe weather, including high winds, hail, tornadoes, heavy rains and flooding, caused the insured damage associated with all six events. At $295 million, Colorado topped the list of the most severely affected states, followed by Texas at $280 million, Oklahoma at $140 million, Missouri at $115 million and Illinois at $110 million. ISO's PCS unit defines a catastrophe as an event that causes $25 million or more in insured property losses and affects a significant number of property/casualty policyholders and insurers.
SURVEY: PRICING SURPASSES TERRORISM AS TOP CONCERN:
An industry survey reveals that pricing is the top of concern facing major reinsurers and carriers in 2004, dramatically surpassing last year's survey results where the top concern was terrorism. According to the survey, Industry Outlook 2004, conducted by National Marketing Services Inc., 82 percent of the executives polled also viewed Democratic presidential hopeful Sen. John Kerry as a foe of the industry. Despite some emerging concerns about President Bush and lingering worries about terrorism, industry executives solidly support a Bush re-election bid by 57 percent compared to 19 percent support for Kerry, the survey found. The survey, which was conducted by telephone with a random sample of insurance executives in the United States and Canada, found that last year's major concerns about mold have been substantially reduced, while concerns about media fairness to the industry have significantly increased. Eighty-two percent now view the media as a foe, nearly double last year's 47 percent response.
