Illinois has recently undergone some important developments in the medical malpractice insurance industry. Due to a February 2010 decision by the Illinois State Supreme Court, the 2005 Medical Malpractice Reform Act, which capped the amount of physician liability for pain and suffering at $500,000, was overturned as unconstitutional. The same law also capped hospital liability at $1,000,000 for pain and suffering. The law did not address the overall amount a patient could receive in a medical malpractice suit.
It remains to be seen what effect the court’s decision will have on physician medical liability and the lawsuit climate in Illinois. According to a recent survey by the Institute for Legal Reform, an affiliate of the U.S. Chamber of Commerce, Illinois has one of the worst legal climates in the country for tort-related cases, including med-mal lawsuits. Out of the 50 states, Illinois ranks 45 on the fairness of its litigation environment. This is actually a slight improvement over the 2008 ranking of 46. Two counties in Illinois had especially poor rankings. Cook County, which includes the city of Chicago, ranked as the most unfair and unreasonable litigation environment in the country, according to the survey, and Madison County, in southern Illinois, ranked fifth.
The Illinois State Medical Society has criticized the court’s decision. Medical society President Dr. James L. Milam addressed it in a letter to the Wall Street Journal, stating “Sadly, this latest bad decision will lead to fewer doctors practicing here and higher costs”. Dr. Milam goes on to explain that the medical malpractice insurance reform law was, indeed, working, and that long-term trends, such as a net loss of physicians in the state, were being reversed.
According to Progress Illinois, a web-based newspaper and blog, the Illinois Supreme Court decision against the Medical Malpractice Reform Act also rolled back some significant laws which had helped to curb the cost of medical malpractice insurance. The 2005 law had included changes to the Illinois Insurance Code that improved insurer reporting and transparency requirements. These changes had led to more competition among insurers, as well as an overall reduction in physician liability premiums of 10 percent.
Data from the Illinois Department of Insurance shows that, in 2008, there were 19 companies offering medical malpractice insurance to Illinois doctors and surgeons that were able to collect more than $500,000 in premiums. In 2005, there were only 14 companies operating at this level. Similarly, the overall number of companies increased during that period, with five companies that did not even offer physician liability insurance in 2005 able to collect more than $1 million in premium by 2008.
Though there is fear that many of these gains will be rolled back, Illinois’ largest med mal insurance company, ISMIE Mutual Insurance Company, has stated that their rate-setting process will not change due to the court’s decision. In an April 2010 posting on the Illinois Medical Society’s web page, ISMIE states that their process for setting medical malpractice insurance rates will remain “as objective and data driven as ever”.
Advocates of medical liability reform and general tort reform will continue to lobby for new laws in Illinois. With two previous Illinois Supreme Court decisions against laws similar to the 2005 Medical Malpractice Reform Act, it is clear that proponents of reform will not give up easily.
Illinois is one of the most expensive states in the nation in which to buy medical malpractice insurance. Doctors need to make sure their agent or broker has access to as many insurance carriers as possible. We have access to more than seven companies in the Prairie State, and can shop your coverage to each and every one of them to ensure you are paying the absolute lowest price.
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This write-up of Illinois was put together by Michael Matray, the Editor of the Medical Liability Monitor