The Pennsylvania Medical Society (PMS) has issued a critique of the recent report by the Center for Justice & Democracy entitled “Premium Deceit.” PMS points out that, contrary to the report’s stated conclusions, the CJ&D’s own data show a correlation between tort reform and lower insurance premiums.
“This technical analysis proves what we suspected all along – that there were significant technical flaws in the original ‘Premium Deceit’ report,” stated David M. Golden, NAII director of commercial lines.
The PMS critique examines the CJ&D’s recently re-released report, “Premium Deceit: The Failure of ‘Tort Reform’ to Cut Insurance Prices,” which the bulletin indicated “is frequently used by plaintiff attorneys and consumer advocates as evidence that tort reforms do not work.”
The critique focuses on the fact that “Premium Deceit” data conflict with the conclusions drawn by CJ&D authors Robert Hunter and Joanne Doroshow. “Based on the report and our own empirical investigation, the Hunter and Doroshow conclusions are wrong – and it would be a mistake to set public policy based on it,” the PMS critique concludes.
According to Dr. Stephen Foreman, director of the Pennsylvania Medical Society Health Services Research Institute, “the (CJ&D) report exhibits a full range of problems”, including:
— Misstatements and omitted concepts;
— Unsupported statements and conclusions;
— Inappropriate attention to irrelevant background facts;
— Distorted methodology making it impossible to find any relationship between liability insurance reform and insurance premiums;
— Use of a spurious multiplier to hide findings;
— Unwarranted conclusions; and
— Improper statistical concepts and conclusions about causality.
“Tort reform does work to the benefit of society by controlling the costs associated with a runaway civil justice system, including the cost of insurance,” Golden commented. “We are glad that an organization as prestigious as the Pennsylvania Medical Society took time to point out the inconsistencies in the CJ&D study.”
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