Hurray for Senator Ensign. Lets see how many of his fellow Senators (lawyers) get on board with this idea. I going to spectulate that not many will. Maybe John Edwards? No, probably not.
This is good for the insurance industry, as claims paid are reduced profits will go up for the insurance company. If premiums go down its bad for agents though, lets hope that doesnt happen. But if the company can lie and decrease premiums by 3% when claims go down by 10% that is still a hefty profit. This is usually what happens. Its good for business, transfer profits from citizens and lawyers to the insurance companies.
Hurray! Sorry guys this one is not about profit, for the insurance company, the lawyers, the Dr\’s, or the injured. It is about returning health care, and health care insurance premiums, to a level where an honest hard working middle class citizen doesn\’t loose his life savings if he gets sick. This senator finally gets it.
This proposed legislation will not have any significant impact on the availability of healthcare or upon the costs of healthcare. Its goal is to require the most seriously injured people to be shortchanged in order to benefit insurance companies. It sounds like a great idea until you are the person who has been maimed by medical negligence.
UW – The average payout in the United States in 2005 was $290,982. There is a big difference between the states. Connecticut had the highest average payment, $731,695, while Nebraska averaged just $97,381. On average, 17 claims are paid for every 1,000 practicing doctors per year. In Wisconsin, only 6 claims are paid for every 1,000 practicing doctors. I tell doctors that they have a chance of a payment being made to one of their patients once in every 166 years of practice.
The Republican party/insurance industry/ Chamber of Commerce alliance couldn\’t get this kind of \”tort reform\” passed when they controlled Congress and the nation trusted the Bush Administration. It\’s not gonna happen now!
Of course, medical malpractice suits only account for 1% of the costs for medical insurers, so even if this does pass, it\’s not going to change anything. I know that the large suits get all the press, but the suits that are really killing us are the ambulance chasers that will settle 100% of their cases for 5,000 a piece, but this certainly will hurt people that bring large claims when they have been injured by the carelessness of the medical profession.
In response to UW, insurance companies for health care providers do not settle cases that do not have merit. In fact, they do not usually settle cases that have merit. Their resistance to paying is one of the reasons there are so few medical malpractice suits filed. In my state, Wisconsin, there were only 81 people in the entire state who received compensation from medical malpractice claims in the last annual report from the National Practitioner Data Bank.
Excellent info. It sounds like this is kind of a high profile political issue vs. and actual problem that impacts rates. But, does this \”problem\” significantly affect doctor\’s med mal premiums or is that more based on a case by case basis?
Mike – how many suits are actually filed nationwide?
I\’m just playing Devil\’s Advocate here for a moment.
There should be 2 effects that would reduce premiums here.
Your nationwide numbers show that about $5000 of malpractice claims are paid for each practicing doctor nationwide. But that\’s just claims paid — that\’s not going to include the costs incurred by the medical insurer to defend these cases. Or those incurred by the medical insurer to defend cases where no claim is paid.
Also, what would those average amounts be if the non-economic damages were capped? Average amounts are very sensitive to large outliers. The reduction in the average paid claim should be a measureable effect of a cap on non-economic damages. If the average amount paid goes down, med mal premiums should go down. If med mal premiums go down, the cost of health care should go down.
The other effect would be decreased lawsuit frequency. We can\’t measure that ahead of time, but I would guess that fewer meritless cases would be filed if the would-be plaintiff knew the amount they could receive was capped.
Very good points also. I think it would very difficult to estimate the money not only on paid amounts, but defense. Not to mention the time involved. I\’m also curious if anyone knows the total US premium levels paid to medical insurers.
Ratemaker,
In 2005 there were 14,021 claims paid in the United States. Of cases that go to verdict, the patients win only about 25%. In Wisconsin, it is about 20%. In Wisconsin, the insurers spend more defending cases than they pay in claims. In 2005 Wisconsin medical malpractice insurers earned direct premiums of $103 million and paid claims of $43 million, for a pure loss ratio of 41%. Not bad for the insurers.
Interestingly, in Wisconsin the entire cost of the medical malpractice system amounts to 0.4 of 1% of our health care costs. In other words, 40 cents of every $100. Caps make very little difference in the cost of health care. Insurance premiums paid by doctors in California, with the most restrictive cap in the country ($250,000)since 1975, are much higher than the premiums paid by doctors in Minnesota, which has never had a cap. The problem with restrictive caps is that lawyers have little incentive to take the risk and incurring the big expenses involved. Thus, many people with legitimate claims never get compensated.
In 2002 the total premiums paid nationwide for malpractice insurance was $7.03 billion. The information is provided by National Association of Insurance Commissioners, 2004 report.
Again, fantastic information. I guess this begs the question…what sort of profit do medical insurers make, and to that end, are high medical premiums warranted? I also wonder what the combined is for medical insurers. Obviously, that is going to fluxuate among carriers, but do the majority make good profits?
Hurray for Senator Ensign. Lets see how many of his fellow Senators (lawyers) get on board with this idea. I going to spectulate that not many will. Maybe John Edwards? No, probably not.
it\’s about time someone got the ball rolling on this. Perhaps we\’ll see a reduction in medical costs as a long-term result of this as well
This is good for the insurance industry, as claims paid are reduced profits will go up for the insurance company. If premiums go down its bad for agents though, lets hope that doesnt happen. But if the company can lie and decrease premiums by 3% when claims go down by 10% that is still a hefty profit. This is usually what happens. Its good for business, transfer profits from citizens and lawyers to the insurance companies.
Hurray! Sorry guys this one is not about profit, for the insurance company, the lawyers, the Dr\’s, or the injured. It is about returning health care, and health care insurance premiums, to a level where an honest hard working middle class citizen doesn\’t loose his life savings if he gets sick. This senator finally gets it.
This proposed legislation will not have any significant impact on the availability of healthcare or upon the costs of healthcare. Its goal is to require the most seriously injured people to be shortchanged in order to benefit insurance companies. It sounds like a great idea until you are the person who has been maimed by medical negligence.
UW – The average payout in the United States in 2005 was $290,982. There is a big difference between the states. Connecticut had the highest average payment, $731,695, while Nebraska averaged just $97,381. On average, 17 claims are paid for every 1,000 practicing doctors per year. In Wisconsin, only 6 claims are paid for every 1,000 practicing doctors. I tell doctors that they have a chance of a payment being made to one of their patients once in every 166 years of practice.
The Republican party/insurance industry/ Chamber of Commerce alliance couldn\’t get this kind of \”tort reform\” passed when they controlled Congress and the nation trusted the Bush Administration. It\’s not gonna happen now!
Of course, medical malpractice suits only account for 1% of the costs for medical insurers, so even if this does pass, it\’s not going to change anything. I know that the large suits get all the press, but the suits that are really killing us are the ambulance chasers that will settle 100% of their cases for 5,000 a piece, but this certainly will hurt people that bring large claims when they have been injured by the carelessness of the medical profession.
In response to UW, insurance companies for health care providers do not settle cases that do not have merit. In fact, they do not usually settle cases that have merit. Their resistance to paying is one of the reasons there are so few medical malpractice suits filed. In my state, Wisconsin, there were only 81 people in the entire state who received compensation from medical malpractice claims in the last annual report from the National Practitioner Data Bank.
Mike,
Sounds like maybe you have some experience in this. Do you happen to know the average med mal payout?
Excellent info. It sounds like this is kind of a high profile political issue vs. and actual problem that impacts rates. But, does this \”problem\” significantly affect doctor\’s med mal premiums or is that more based on a case by case basis?
Mike – how many suits are actually filed nationwide?
I\’m just playing Devil\’s Advocate here for a moment.
There should be 2 effects that would reduce premiums here.
Your nationwide numbers show that about $5000 of malpractice claims are paid for each practicing doctor nationwide. But that\’s just claims paid — that\’s not going to include the costs incurred by the medical insurer to defend these cases. Or those incurred by the medical insurer to defend cases where no claim is paid.
Also, what would those average amounts be if the non-economic damages were capped? Average amounts are very sensitive to large outliers. The reduction in the average paid claim should be a measureable effect of a cap on non-economic damages. If the average amount paid goes down, med mal premiums should go down. If med mal premiums go down, the cost of health care should go down.
The other effect would be decreased lawsuit frequency. We can\’t measure that ahead of time, but I would guess that fewer meritless cases would be filed if the would-be plaintiff knew the amount they could receive was capped.
Ratemaker,
Very good points also. I think it would very difficult to estimate the money not only on paid amounts, but defense. Not to mention the time involved. I\’m also curious if anyone knows the total US premium levels paid to medical insurers.
Ratemaker,
In 2005 there were 14,021 claims paid in the United States. Of cases that go to verdict, the patients win only about 25%. In Wisconsin, it is about 20%. In Wisconsin, the insurers spend more defending cases than they pay in claims. In 2005 Wisconsin medical malpractice insurers earned direct premiums of $103 million and paid claims of $43 million, for a pure loss ratio of 41%. Not bad for the insurers.
Interestingly, in Wisconsin the entire cost of the medical malpractice system amounts to 0.4 of 1% of our health care costs. In other words, 40 cents of every $100. Caps make very little difference in the cost of health care. Insurance premiums paid by doctors in California, with the most restrictive cap in the country ($250,000)since 1975, are much higher than the premiums paid by doctors in Minnesota, which has never had a cap. The problem with restrictive caps is that lawyers have little incentive to take the risk and incurring the big expenses involved. Thus, many people with legitimate claims never get compensated.
In 2002 the total premiums paid nationwide for malpractice insurance was $7.03 billion. The information is provided by National Association of Insurance Commissioners, 2004 report.
Mike,
Again, fantastic information. I guess this begs the question…what sort of profit do medical insurers make, and to that end, are high medical premiums warranted? I also wonder what the combined is for medical insurers. Obviously, that is going to fluxuate among carriers, but do the majority make good profits?