Medical malpractice insurance in New Jersey is very expensive. The state’s obstetricians pay the seventh-highest liability premiums in the nation. In a clear cause-and-effect relationship with those premiums, New Jersey has the highest caesarean rate in the country. The state is also staring down the barrel of an impending, severe physician shortage.
New Jersey’s litigation climate is so hostile, the Garden State ranked No. 4 on the American Tort Reform Association’s 2009/2010 Judicial Hellholes Report, an annual listing of plaintiff-friendly states, in which New Jersey has been listed in the top five since 2007. In 2008, the state had 10,579 new liability cases filed. To be fair, the large majority of those cases do not concern medical malpractice, but it does indicate the tenor of New Jersey’s legal atmosphere.
New Jersey’s expensive medical malpractice insurance rates have much to do with its lack of medical liability tort reform legislation. In fact, the state’s only medical liability-specific reform on the books is a contingent fee reform law that limits attorney contingency fees in malpractice cases pursuant to a sliding scale provided in the New Jersey Court Rules. The state previously required an affidavit of merit in all medical liability proceedings, but in 2010, New Jersey Supreme Court decision loosened the statute to the point of irrelevance.
But tort reform advocates in New Jersey have reason to be hopeful. After years of the healthcare community warning of a physician shortage, the media and citizenry has finally taken notice. The statewide Physician Workforce Policy Task Force, which the New Jersey Council of Teaching Hospitals trade group began in 2007, recently released a report detailing a current 12-percent gap between the supply of physicians and demand as well as projecting a doctor deficit of almost 1,000 primary care physicians and 1,800 specialists by 2020.
In addition to new attention being paid to looming physician shortages, Gov. Chris Christie has been paraded as a legal reformer, having campaigned on a platform that promised to discourage frivolous lawsuits and enhance the integrity of scientific evidence admitted in the court. Christie and the General Assembly, as well as the state Senate, have already filed a bill for debate in the 2011 legislative session that pertains to liability, standards of care and insurance coverage for medical malpractice actions.
The medical malpractice reform bill—referred to in the legislature as S-760/A-1982—is intended to reform the medical malpractice insurance laws in New Jersey that are partly to blame for the state’s physician shortage. The bill aims to put in place reasonable restrictions on what may be considered in a malpractice lawsuit and how insurers may react to those suits. The bill would prevent medical malpractice insurance companies from raising premiums unless a physician is found liable of a medical malpractice claim; require that a malpractice action against a health care provider be commenced within two years after the plaintiff discovers the injury, but not more than four years after the alleged act; mandate only licensed medical professionals may be permitted to give expert testimony on the standard of practice; and that physicians licensed in the State of New Jersey shall not be liable for civil damages in the case of rendering treatment in good faith as a volunteer at a healthcare facility.
While New Jersey physicians and tort reform advocates have real reason to be optimistic that new legislation could bring medical malpractice insurance premium relief, any bill passed this year would take several years to affect rate relief. For this reason, it is critical to a physician’s business success to enlist the help of an experienced broker with access to all of New Jersey’s major medical malpractice insurance companies when looking to acquire medical liability insurance coverage.
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This write-up of New Jersey was put together by Michael Matray, the Editor of the Medical Liability Monitor