New AMA report cites effectiveness of malpractice award limits

By Fred Bazzoli, Editor
http://www.healthcarefinancenews.com

According to the American Medical Association, medical liability reforms that put limits on non-economic damages help lower malpractice insurance premiums and increase the number of doctors.

The analysis of independent research by the Chicago-based professional association is the latest salvo by the AMA to increase the prevalence of malpractice reforms and, specifically, limits on awards.

Caps on non-economic damages are effective and help to increase the number of physicians available to care for patients, the AMA concluded.

The organization contends that, in states in which malpractice reforms have not been implemented, many physicians are compelled to make difficult practice decisions to limit the care they provide.

The AMA released its review of recent literature in a publication titled “The Impact of Liability Pressure and Caps on Damages on the Healthcare Market: An Update of Recent Literature.”

The report says research on caps on non-economic damages are associated with premium levels that are an average of 17 percent lower, depending on the specialty.

The AMA said research on a possible cap of $250,000 on non-economic damages in states that don’t have such limits could save nearly $1.4 billion in premiums.

The report also contends that the number of physicians in high-risk specialties, such as obstetrics and gynecology, is 4 percent to 7 percent higher in states with award limits.

The AMA continues to voice concerns that, without limits on non-economic damages, there’s no way to constrain jury awards. The AMA supports caps on the non-economic damages of jury awards and unlimited payments for economic damages to help stabilize awards while preserving patient access to the judicial system.

“For many patients, access to care is put in jeopardy because premiums for many physician specialties remain at or near all-time highs,” said William G. Plested III, MD, immediate past president of the AMA. “Although premium rates have stabilized, they remain at the highest levels in history.”

For example, the AMA says, annual liability premiums for obstetrician-gynecologists in New Jersey have reached $171,000, more than double what these physicians paid for coverage in 2000.
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