Washington’s largest writer of medical malpractice coverage for physicians and surgeons has reduced premiums for 2008 by 12.5 percent, following what appears to be a record-setting year of profits for the company in 2007, according to the Washington Office of the Insurance Commissioner.
The rates, were announced by Physicians Insurance, the Seattle-based company that provides coverage for approximately 62 percent of the physicians in Washington who purchase medical malpractice insurance from a regulated insurer. Although base rates remained stable, the company’s action will result in premium reductions of up to 20 percent for physicians with good claims experience, the OIC indicated.
“This is certainly good news for the physician community and the overall effort to control health care costs,” said Insurance Commissioner Mike Kreidler. “It also shows that premiums can be contained without sacrificing the rights of patients.”
The declining cost of medical malpractice insurance in Washington appears to reflect a trend seen in many states across the nation. However, unlike other states where tort reform advocates have drawn a direct correlation between declines in premiums and tort reform legislation, Washington’s doctors are benefiting despite the failure of a tort reform initiative at the hands of voters in 2005.
Kreidler attributed the good news in Washington to a number of factors, including the leadership of Gov. Christine Gregoire in brokering a deal that produced a negotiated medical malpractice reform bill that easily won passage in the Legislature. Among the provisions of the bill is the authority for the Insurance Commissioner to collect detailed statistics on closed malpractice claims to better understand the dynamics in the medical malpractice insurance marketplace.
Meanwhile, Physicians Insurance appears on the verge of a banner year for profits in 2007. Through the first nine months of the year, the company reported profits totaling $17 million. The final quarter numbers and the year’s totals won’t be reported until March 1, 2008. But barring a year-end collapse, the company seems certain to exceed the record $15 million in profits reported in 2006, according to the OIC.
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