Survey Finds $180 Million Rise in Pa. Hospitals’ Med Mal Rates

May 7, 2002

Hospitals in Pennsylvania are estimated to be paying more than $180 million in additional premiums for medical liability insurance compared to a year ago, according to a statewide survey of medical professional liability coverage by The Hospital & Healthsystem Association of Pennsylvania (HAP).

Despite recently enacted legislation aimed at curtailing medical malpractice awards and reducing premiums, the state’s hospitals are being hit hard by the increases, most of which were assessed even before “the collapse of the Pennsylvania liability insurance market,” according to Carolyn F. Scanlan, president and CEO of HAP.

“Hospitals now going into the market for renewal or replacement coverage as of July through September 2002-when more than half of all hospital policies expire-are expecting even larger additional premium hikes that will further erode patient access to care. If a hospital cannot afford or get insurance coverage, services will suffer, stated Scanlan.”

She urged the Pennsylvania General Assembly to take action on legislation (S.B. 1376, H.B. 2315) to repeal joint and several liability. The current system “holds each defendant in a lawsuit financially liable for the full amount of a damage award, even if the defendant’s legal responsibility is deemed to be minimal. Joint and several liability is inherently unfair to businesses and individuals,” Scanlan stated. “It lets the most negligent defendant off the hook while penalizing defendants who were only remotely involved.”

The survey found that a number of the state’s hospitals were curtailing services, such as emergency care and maternity departments as they are unable to afford the insurance premiums.

Scanlan also supported passage of federal legislation, sponsored by Rep. Jim Greenwood (R-Erwinna), John Murtha (D-Johnstown), and others, that “would place a $250,000 cap on non-economic damages, establish criteria for awarding punitive damages, eliminate joint and several liability, include a collateral source provision, establish periodic payments, and institute a sliding scale for attorneys fees.”

She warned that hospitals were facing a financial crisis from the rate rises that threatens their continued existence. ” This is a prescription for disaster that will erode patient access to the world’s best health care,” she concluded. .

Topics Legislation Trends Pricing Trends Pennsylvania

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