We are flummoxed, discombobulated, befuddled, bewildered and downright bollixed up by this announcement from the Florida Office of Insurance Regulation, and by how little critical attention it appears to have received from mainstream media.
All we’ve been able to find is this nugget of unthinking repetitiousness from the Orlando fish wrapper, which is barely better than nothing, which is exactly what we’ve read about it here in Tampa Bay, although we did find this in the Times’ morgue.
Two weeks ago Kevin McCarty, head honcho at the Office of Insurance Regulation, said medical malpractice insurance premiums declined by three percent in 2006. This, he said, shows “that the Florida Legislature’s efforts to control (malpractice rates) have been effective.”
Huh? What about those profiteering bastar … What about the insurance companies? Weren’t they supposed to slash rates as a result of the legislature’s supreme effectiveness?
In 2003 state lawmakers passed a $500,000 limit on pain-and-suffering damages. In 2004 voters passed a constitutional limit on lawyers’ fees in malpractice cases. Some people refer to this as “tort reform.” Other people call it screwing the consumer. Either way, the general idea was to reverse the upward spiral in malpractice insurance rates and to stop a supposed (but apparently bogus) exodus of doctors from the Sunshine State.
This stream of fact-laden, superb reporting by Amy Keller at Florida Trend really draws the picture in concise, understandable terms.
Keller informs us that medical malpractice insurance losses in Florida are way down from $989 million in 2003 to $557.5 million in 2005. McCarty’s press release says closed claims in 2006 totaled $188 million. We’re not sure whether that represents total losses for 2006 but we are sure that the trend is down.
Effective? Hell, yes!
What is not sharply down in Florida is the average medical malpractice insurance rate. And guess what isn’t down at all. Uh-huh. Insurance company profits. Keller notes that 15 companies made more than $800 million in profits between October 2005 and October 2006. They paid out about 40 percent of the premiums they collected. That means they got fat on about 60 percent.
According to Keller, “The market is now attractive enough that between October 2005 and October 2006, eight new companies, most of them risk-retention groups structured like mutual insurers, started selling med-mal insurance in the state.” She wrote that in March of 2007, six months before McCarty’s press release made it sound like blessings of legislative wisdom.
Here’s something else Keller wrote: An OB/GYN in Atlanta pays on average $69,550 for $1 million in liability coverage. In Hillsborough County, the average is $141,271 for the same coverage.
Do you smell something?
Back in April the state’s consumer advocate asked regulators to roll back malpractice premiums by 40 percent because cost reductions were not fairly represented in premiums. Here we are six months later and McCarty doesn’t mention a word of that in his press release. Not a word.
Something definitely stinks.