Consultant Hails Md. Gov. Ehrlich’s Med-Mal Bill

February 25, 2005

A consultant hired by the Ehrlich administration estimates Gov. Robert Ehrlich’s new medical malpractice insurance bill would save doctors about six times as much money as the bill that was enacted over his veto by the Maryland legislature in January.

The new bill, which is awaiting hearings in the Senate and House of Delegates, would reduce malpractice premiums by about 18.8 percent when the savings are fully implemented, which could take up to five years, said a report by Milliman Consultants and Actuaries of Garden City, N.Y.

The same company estimated that the malpractice reforms passed by the legislature at a special session in December will reduce premiums by about 2.9 percent.

The Milliman reports confirm what the governor had said all along, that the legislature’s bill did very little to reduce rates, Don Hogan, one of the governor’s legislative aides, said.

“We missed an opportunity to do the reforms that are really necessary.”

The Republican governor called lawmakers into special session in December to deal with what he and legislative leaders said was a growing crisis in the health care industry. Doctors and hospitals were crying out for relief from soaring malpractice insurance premiums that they said threatened to drive some health care providers out of business — especially those in high-risk specialties such as obstetrics and neurosurgery.

Ehrlich worked with House Speaker Michael Busch and Senate President Thomas V. Mike Miller, both Democrats, to craft a bill all could agree to, but the governor withdrew his support after changes were made by the legislature.

When he vetoed the bill Jan. 10, Ehrlich derided it as “tort reform light” and said it would do little to help physicians, citing the consultant’s estimate that it would reduce premiums by just 2.9 percent. The governor’s office would not release the consultant’s report then, but recently provided copies of reports on both bills to The Associated Press in response to a Maryland Public Information Act request.

The law passed by the legislature included some limits on malpractice settlements, which doctors and insurance companiesblame for rising insurance costs. Ehrlich’s bill would go much further, including reducing the cap on noneconomic damages commonly referred to as “pain and suffering,” reducing payments for estimated future medical bills and requiring damages awarded to patients to be paid out over a number of years instead of in an upfront lump sum payment.

While some doctors criticized the bill, state associations representing Maryland’s doctors and hospitals supported it and supported the veto override, viewing the limits on malpractice settlements as a good beginning. They also liked provisions in the bill increasing payments to doctors who treat Medicaid patients and creating a fund that would temporarily limit premium increases and, if necessary, underwrite losses by insurance companies resulting from reduced premiums.

Nancy Fiedler, spokeswoman for the Maryland Hospital Association, said the association supports the governor’s new bill, but still believes it made the right decision in backing the decision by legislative leaders to override the veto.

“We still feel that the passage of House Bill 2 gave Maryland doctors and hospitals some desperately needed breathing room,” she said.

T. Michael Preston, executive director of the Maryland State Medical Society, said doctors “appreciate the fact that HB2 didn’t solve the problem, and we strongly support measures for additional reform….”

“HB2 was a start…,” Preston continued. “It was not as robust a package of reforms as we would like, but they were the proposals on the table, and incremental progress is the way Annapolis works.”

Copyright 2005 Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

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