Doctors fear impact of insurance surcharge

by By Frank Donnelly

State’s plan to assess 50Gs more will force many to close practices, Island opponents say

Staten Island doctors fear a proposal being floated to hit them with a $50,000 surcharge to solve the state’s medical malpractice insurance funding woes could drive droves of physicians, from internists to high-risk specialists, out of medicine.
Even worse, they say, it will adversely impact patients.
“There’s going to be practices going out of business and the higher-tech specialties [such as obstetricians, neurosurgeons and orthopedists] are going to be harder to find. Everybody’s nervous about what’s going to happen, ” warned Dr. Ralph K. Messo, president of the Richmond County Medical Society, who practices internal medicine and pediatrics in Eltingville. “It’s going to affect patient care.”

Dr. John Maese, a past president of the medical society, paints an even gloomier picture.
“It will just be the death knell of primary care,” said Maese, who practices internal medicine and geriatrics in Eltingville and is on the board of governors of the American College of Physicians.
“There’s no way you have a spare $50,000 to cover that on top of your regular $30,000 [in annual medical malpractice insurance a Staten Island general practitioner typically pays]. Primary care practices run on a very tight [profit] margin.”
“I think private practice as we understand it will be gone,” predicted Dr. Maese, adding doctors likely will join hospital staffs.
And internists are on the low-end of the premium spectrum.
The typical Island obstetrician-gynecologist pays an eye-popping $160,000 to $225,000 in annual malpractice premiums, doctors say. A neurosurgeon on Long Island pays more than $300,000 a year, according to the state Medical Society.
The Medical Malpractice Insurance Plan, the state-regulated, high-risk pool for doctors declined coverage by commercial carriers, is $500 million in debt.
In July, Gov. Eliot Spitzer created a task force to probe the state’s soaring medical malpractice costs. The group was formed on the heels of a 14-percent medical malpractice insurance premium spike — the largest increase in 14 years.
The committee, headed by state Insurance Superintendent Eric R. Dinallo and Dr. Richard F. Daines, the state health commissioner, was charged to consider all possible solutions to control medical malpractice costs, including risk management, legal reform and regulatory changes. It seeks both short-term and long-term options.
Its report, originally slated to be completed Dec. 31, isn’t finished and a new date has not been set, officials said. ÂÂ?
At the time the committee was formed, Daines said in a statement, he feared increasing malpractice insurance costs “will drive some physicians out of the field and will discourage young people from entering the medical profession.”
Meanwhile, Dinallo said insurers’ financial states were “rapidly eroding.”
Dinallo said the prior administration in Albany had kept malpractice insurance premiums “artificially low” for years. In addition, it had appropriated $691 million of medical malpractice insurance reserve funds for general state expenses, which ultimately helped create the current crisis for doctors and insurers, he said.
According to published reports, doctors in the high-risk pool that is deeply in debt, whose premiums are substantially more than their colleagues, could also be the specific targets of a surcharge.
David Neustadt, an Insurance Department spokesman declined to speculate last week on any conclusions the task force might have reached. But he said current state law provides that doctors can be surcharged to make up deficits to pay medical malpractice claims.
“That’s not saying that’s going to happen,” stressed Neustadt, adding that any surcharge would not be tacked on to doctors’ current annual premiums, and would be paid over time.
A surcharge is especially problematic, doctors contend, because they can’t pass costs on to patients, as say, supermarkets can to customers, if the price of tomatoes sky-rockets. Nor do they want to.
“Our rates are essentially fixed by the insurance industry,” said Dr. Jack D’Angelo, who practices physical medicine in New Dorp and is a past president of the county medical society.
Despite public perception, many doctors don’t live on easy street, he said.
The typical Staten Island general practitioner earns between $130,000 and $150,000 a year. Expenses and overhead are rising, but medical reimbursements aren’t keeping pace, so a $50,000 surcharge would really hurt.
“It’ll be a huge burden,” said Dr. D’Angelo. “As physicians, we believe strongly we can’t absorb it.” ÂÂ?
Those who can’t take on the added costs may have to leave the field — or join a hospital.
Many have already done so.
From 2000 to 2004, the Island lost 19 percent of its full-time primary care physicians per capita — a greater loss of doctors per capita than in any other borough, according to a survey by the State University of New York at Albany, the Advance has reported.
While Manhattan had an average of 181 primary care doctors per 100,000 residents, Staten Island had a little more than 75 doctors for the same population.
“Patients won’t be able to get the proper care,” warns Dr. Joseph Motta, president of the medical staff at Richmond University Medical Center, West Brighton, and the immediate past president of the county medical society. “The potential problems will take on a global significance.”
Specialty practices also have been hard-hit.
Dr. Mitchell Maiman, chairman of obstetrics and gynecology at Staten Island University Hospital, recently estimated that 12 or 13 OB-GYNs — or about half those associated with the hospital — have limited their practice or left it in the past seven to eight years due to soaring medical malpractice premiums or fear of litigation.
“The last thing we want is for physicians to decide if they have to go out of business,” said Rep. Vito Fossella (R-Staten Island/Brooklyn), who, along with state Sen. Andrew Lanza (R-Staten Island) last week urged Gov. Spitzer to take the surcharge proposal off the table. “Patients will ultimately suffer. One of the suggested cures [by the task force] could be worse than the illness.”
Doctors D’Angelo, Maese, Messo and Motta advocate tort reform — capping limits on pain and suffering awards — and perhaps even establishing medical malpractice courts where a panel of medical experts decides malpractice claims. Fossella also is a tort-reform proponent.
Dr. D’Angelo further suggests that profitable insurance carriers help assume some of the premium burdens.
Critics, however, contend the court system works fine. Instead of griping about it, they say doctors and the state need to do a better job of weeding out the small number of bad physicians.
According to a 2003 study by Public Citizen, a national non-profit consumer watchdog, 7 percent of the state’s 80,000 doctors account for 68 percent of medical malpractice payouts.
Dr. Messo said finding an equitable solution is crucial, and everyone from politicians to insurance carriers, must pitch in.
“Right now, it’s the physicians’ problem,” he said. “Tomorrow it will be the public’s problem.”
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