The Maryland State Medical Society is taking the unprecedented step of asking insurance regulators to review a proposed 28% increase in medical malpractice insurance rates by the state's dominant commercial carrier, saying the hike threatens access to care.
"This is not a confrontational step. This is intended to be a confidence builder," says Michael Preston, executive director of the Baltimore-based society, commonly known as MedChi.
Preston says the society has no plans to take on the physician-owned Medical Mutual Liability Insurance Society of Maryland since policyholders also are MedChi members. "The problem is the environment" in which jury verdicts for malpractice have soared, as in other states, he says.
Maryland has a cap on noneconomic damages in malpractice cases that currently stands at $620,000, but it grows at about $15,000 a year under a complicated formula, Preston says. However, there is no cap on awards for wrongful death.
"We expect there will need to be an important reform agenda legislatively," Preston says.
MedChi plans to hire an independent actuary to review the increase proposed by Medical Mutual, which Preston says is "virtually alone now in the commercial market" in Maryland, covering nearly every physician in the state not insured by institutional self-insurance programs. Preston says he expects the Maryland Insurance Administration to review the proposed premium hikes by the end of the summer, ahead of the fall billing season for 2004 coverage.
The medical society says the 28% increase goes pretty much across the board for Maryland physicians, but Preston acknowledges high-risk specialties such as OB/GYN, trauma care and orthopedics are in a more precarious position, especially in light of declining reimbursements.
"Primary care is not necessarily in crisis, but verging on it," Preston says.
MedChi cites a recent survey by the Maryland chapter of the American College of Obstetricians and Gynecologists that suggests that one-third of OB/GYNs in the state would stop delivering babies if their malpractice insurance costs increased by 25% or more.
"We expect that OB/GYN will be the canary in the coal mine," Preston says.