The Center for Justice and Democracy, New York, said 15 of the nation's biggest malpractice insurers "price-gouged" physicians from 2000 to 2004, increasing net premiums 120% while their net payments for claims rose 5.7% during that period. Nine of the 15 companies in the center's report were mutual insurers owned by policyholders. Among the six publicly traded companies in the report, three did a large portion of their business in medical malpractice and three did not. Study author Jay Angoff, former director of the Missouri Insurance Department, said the data "prove that doctors have been overcharged during the last several years." The 25-page report was based on insurers' annual statements, the center said.
Lawrence Smarr, president of the Physician Insurers Association of America, which represents professional liability insurers, said the study did not prove price-gouging because companies set premiums to build reserves for future claims a decade or more in advance. Smarr said liability insurers as an industry have lost money for the past five years. The center is a not-for-profit organization opposed to tort reforms that limit consumers' rights, according to its Web site. Read the report. -- by Michael Romano