New Jersey Bill would limit rate hikes for medical malpractice insurance
side note: Here is a state-level attempt at reigning in medical malpractice insurance rate hikes. Could this be the model for the rest of the country? Only time will tell……
Bill would limit rate hikes for medical malpractice insurance
TRENTON – The Senate Commerce Committee today approved a bill to limit how much medical-malpractice insurance rates can increase year to year.
The legislation (S2934/A4245) requires the Department of Banking and Insurance to designate a range for medical malpractice liability insurance rate changes — increases or decreases — of between 5 percent and 15 percent.
“Rate increases are sometimes an inevitability, especially when malpractice liability insurance providers have to balance risk assessments for various medical specialties,” said Sen. Joseph Vitale (D-Middlesex), one of the bill’s sponsors. “While many health care professionals wouldn’t disagree with common-sense rate increases as part of the cost of business, malpractice liability insurance rates seem to be dictated by anything but common sense. If the rate increase is appropriate, it would continue to pass muster with DOBI regulators, but something has to be done to begin to rein in out-of-control malpractice liability insurance costs.”
Co-sponsored by Sen. Loretta Weinberg (D-Bergen), the bill also would give the insurance department responsibility for the deciding applicable categories, subcategories, specialties and subspecialties of health care providers.
The legislation would allow the department to approve rate changes that exceed the range limits, and it would remove a provision that considers annual premiums above $10,000 a “special risk” and subject to an alternate route rate.