It’s not just about the payments. Insurers have to reserve for all claims as a result of the policy being issued and many of the current claims have not been identified and/or sued over yet or in the course of working their way through the legal system. So, you can’t just collect enough this year to cover the payments this year — that’s what a Ponzi scheme is. So, either the so-called “consumer advocates” are advocating that medical malpractice insurers use Bernie Madoff rules of accounting or they don’t understand how insurance works.
how can a very complex subject be so simplified? it can’t. exactly who are these folks called “consumer advocates”- plaintiff attorneys, perhaps? who are the “multiple payment” providers and what specifically does that mean? if these are doctors with multiple damage awards, why are still practicing? how does one begin by saying claims are holding steady and later say they are going down?
there must be facts out there that can reveal the truth. we need to de-politicize the systems in place and begin with tort reform.
I worked at MLM for 12 years, left in 1996 when their surplus was 2 billion dollars. Times were good and it was not that long ago. They needed a loss leader and purchased MMIA, the assigned risk pool and HANYS- then Princeton. Their rating dropped. If they currently have a $300 mil surplus, insure 60% of the NY docs in a state that paid 800 mill in claims last year- how comfortable is the 300k surplus? ( 15% of the surplus in 1996). This is one of the top 2 strongest insurers nationwide. Have you ever thought about the term – negative surplus? Like PRI with a $43 mil Neg sur.
LAE eats up 30-40% of the indemnity money. Plaintiff attorney fees conservatively have to be 30% plus expenses. Is there any way for you to argue that the injured party should justifiably obtain only 30-40% of all the monies paid on the case? Probably a lot less. Can the total costs of med mal be trimmed 20-25%, with the injured party getting more of the money?- Easily. How would this impact the med mal crisis? Healthcare costs? Clogged courtrooms?
My points thru hands on observation since 1985:
– 15% of the docs cause 82% of the med mal. They can be targeted for discipline or removal. We do it at PIC. Check our numbers.
– Defense costs and contingency fees eat up 50-60% of every indemnity payment.
– Docs never ever get a jury of their peers and are vunerable to Hollywood courtroom scenes.
– Arbitration improvements could move things quicker, provide a peer group, and get the most money to the actual injured party.
– That plaintiff firms are genuine well meaning advocates, but will never argue for a solution to med mal at their own expense. I understand that, and it’s the 800lb gorilla.
– That a cap for non economics is imperfect , but some measuring stick is needed. Weighing pain is similar to weighing smoke.
– In 25years I have only paid aggregate limits on 3 docs, all 3 were plastics. All injuries that fell into the smoke category, no measuring stick to weigh the P&S.
– Meritorious claims should be settled at a fair cost, preferably structured.
– Good ideas are never immune from compromise, so we end up shuffling the same deck of cards and fail to solve the issues. Does any of the above sound reasonable to you?
I appreciate the discourse.
Regards Jim
James C. O’Hare AIC, AIS
VP- Claims
Physicians Insurance Company
It’s not just about the payments. Insurers have to reserve for all claims as a result of the policy being issued and many of the current claims have not been identified and/or sued over yet or in the course of working their way through the legal system. So, you can’t just collect enough this year to cover the payments this year — that’s what a Ponzi scheme is. So, either the so-called “consumer advocates” are advocating that medical malpractice insurers use Bernie Madoff rules of accounting or they don’t understand how insurance works.
how can a very complex subject be so simplified? it can’t. exactly who are these folks called “consumer advocates”- plaintiff attorneys, perhaps? who are the “multiple payment” providers and what specifically does that mean? if these are doctors with multiple damage awards, why are still practicing? how does one begin by saying claims are holding steady and later say they are going down?
there must be facts out there that can reveal the truth. we need to de-politicize the systems in place and begin with tort reform.
How to help this med mal crisis:
I worked at MLM for 12 years, left in 1996 when their surplus was 2 billion dollars. Times were good and it was not that long ago. They needed a loss leader and purchased MMIA, the assigned risk pool and HANYS- then Princeton. Their rating dropped. If they currently have a $300 mil surplus, insure 60% of the NY docs in a state that paid 800 mill in claims last year- how comfortable is the 300k surplus? ( 15% of the surplus in 1996). This is one of the top 2 strongest insurers nationwide. Have you ever thought about the term – negative surplus? Like PRI with a $43 mil Neg sur.
LAE eats up 30-40% of the indemnity money. Plaintiff attorney fees conservatively have to be 30% plus expenses. Is there any way for you to argue that the injured party should justifiably obtain only 30-40% of all the monies paid on the case? Probably a lot less. Can the total costs of med mal be trimmed 20-25%, with the injured party getting more of the money?- Easily. How would this impact the med mal crisis? Healthcare costs? Clogged courtrooms?
My points thru hands on observation since 1985:
– 15% of the docs cause 82% of the med mal. They can be targeted for discipline or removal. We do it at PIC. Check our numbers.
– Defense costs and contingency fees eat up 50-60% of every indemnity payment.
– Docs never ever get a jury of their peers and are vunerable to Hollywood courtroom scenes.
– Arbitration improvements could move things quicker, provide a peer group, and get the most money to the actual injured party.
– That plaintiff firms are genuine well meaning advocates, but will never argue for a solution to med mal at their own expense. I understand that, and it’s the 800lb gorilla.
– That a cap for non economics is imperfect , but some measuring stick is needed. Weighing pain is similar to weighing smoke.
– In 25years I have only paid aggregate limits on 3 docs, all 3 were plastics. All injuries that fell into the smoke category, no measuring stick to weigh the P&S.
– Meritorious claims should be settled at a fair cost, preferably structured.
– Good ideas are never immune from compromise, so we end up shuffling the same deck of cards and fail to solve the issues. Does any of the above sound reasonable to you?
I appreciate the discourse.
Regards Jim
James C. O’Hare AIC, AIS
VP- Claims
Physicians Insurance Company