Malpractice reform rushed
Monday, March 24, 2003
Like legislators in many other states, New Jersey state senators are reacting to a doctors' strike and to persistent, insistent demands to do something about ultra-high malpractice premiums.
So our Senate last week passed a measure that is likely to provide a new feeding trough for those greedy lawyers it
denounces, and it will come at public expense, without bringing premiums down anytime soon.
The Senate bill would put a $300,000 limit on the amount a doctor's malpractice insurance company pays out for
"pain and suffering" in any one case. A new state fund would pay up to $700,000 more.
It will be bankrolled with a $20 million-a-year fund, built by charging doctors and lawyers an extra $50 licensing
fee and taking $3 for each employee from employers -- some of whom might argue their own need for
insurance relief and be displeased at having to pay for someone else's.
It is not just the application of this measure that is bad. The legislation was proposed without the benefit of facts.
The Senate voted to limit and then to supplement pain-and-suffering awards without first finding out how
much the bill for pain and suffering actually is.
No one has ever supplied that information. The Senate should have subpoenaed it from the insurance companies,
along with details on how often those awards are reduced by judges or through pre-appeal
settlements.
Will insurance companies be aggressive about settlements if someone else picks up a tab of more than $300,000?
Should a public fund pick up the tab for bad doctors?
Before the vote, senators publicly complimented each other on the bill. Privately, some of the same senators have
expressed reservations because they know that the fund is fraught with peril and that their
decision-making was devoid of the data a $20 million-a-year decision requires.
Voting for malpractice reform has been equated with voting to keep baby doctors and neurosurgeons on the job.
It is a fact that some specialists have been hit with inexplicably sudden and outrageously high malpractice
premiums. Yet no one has answered such basic questions as exactly how many doctors are in trouble and how
many need help right now, how many cannot wait for some leisurely decrease in premiums that may or may not
come because of a cap.
The doctors and insurance companies say California has stable premiums because of a $250,000 cap on
pain-and-suffering awards.
But California's rates did not drop until additional insurance reform provided for public hearings and a good look at
the books anytime an insurance company proposes a premium increase of 11 percent or more.
The New Jersey Senate bill sets the trigger for scrutiny at a 25 percent premium jump, which is far too high. That
practically guarantees a spate of 24.999 percent increases, plenty high enough to keep pushing doctors
out of practice.
California insurance reform also required a rollback in premiums. If we are
going to limit an injured party's ability to recover damages and have taxpayers assume the high-end risk for the insurance companies while
reducing the statute of limitations for suing on behalf of a child -- all of which the Senate bill would do -- we must guarantee that
the public gets something out of the deal.
Some weeks ago, a major malpractice carrier said it could reduce premiums 25 percent if it got a cap on
pain-and-suffering awards. Write that rollback into law.
Keeping doctors in practice is a public necessity. No one should argue about that. But when the Assembly takes
up the malpractice legislation, there must be much more informed debate about the solution.