Is there a doctor in the house?(Probably not)*Crippling malpractice insurance costs drive physicians away, stifle recruitment

By Carl Hamilton

A doctor shortage continues to hamper Cecil County, two years after the Maryland General Assembly passed legislation to reduce the soaring cost of medical malpractice insurance.

“We’re still way down,� said Dr. Jose Ma, vice president of medical affairs at Union Hospital in Elkton.

Doctors specializing in obstetrics, which typically includes gynecology, are strained the most.

According to Ma, American Medical Association population-based standards dictate that Cecil County should have 14 full-time obstetrician-gynecologists.

Instead, however, only three full-time OB-GYNs practice here while another doctor specializing in that area is part-time, Ma said. That figure, he added, is down from 2004 when this county had seven full-time doctors who delivered babies.

The AMA establishes a doctor-per-population ratio for every specialty, including general practice, as well as a standard for the total number of doctors in a county or specified area.

Delivering babies is a high-risk service that, consequently, translates to higher medical malpractice insurance costs. Extra-high premiums are encountered by surgeons, too.

Because there is an inadequate number of OB-GYN doctors here, the ones who do provide those services in Cecil County face heavy patient loads, Ma said.

And the overflow goes elsewhere for OB-GYN services, usually into neighboring Harford County and Delaware, he added.

Meanwhile, although approximately 250 doctors are considered part of this county’s overall medical staff, only about 70 base their practices primarily in Cecil County, according to Ma.

That number is low, based on AMA standards that factor in Cecil County’s population, which is about 100,000, Ma reported.

In November 2004, when the Cecil Whig last interviewed Ma, who also oversees physician recruitment here, Cecil County needed to add 19 more doctors by 2007 to meet AMA standards.

But, more than two years later, recruiters have only been able to lure nine doctors, including specialists and general practitioners. None of them delivers babies.

Words spoken by Ma in November 2004 ring prophetic now.

“To be honest, I don’t think we’ll meet that goal. It’s awful ambitious,� Ma said at the time, adding, “This isn’t an overly appealing place. We can’t talk to prospects without the medical malpractice rate coming up (in conversation).�

Renewed call for action

Doctors across Maryland started pushing, once again, for lawmakers to combat excessively high medical malpractice premiums in November 2004.

The catalyst: They had just received their annual bills from the Medical Mutual Liability Insurance Society of Maryland, which insures about 80 percent of the doctors in this state and mails out its annual bills every November.

Of the three firms in Maryland offering insurance to doctors, only Med Mutual insures physicians exclusively. Med Mutual is owned and operated by physicians.

In the weeks before sending the bills, Med Mutual mailed a notice to its customers warning of even greater increases.

The letter explained that “skyrocketing jury awards� and a growing number of medical malpractice settlements in other civil cases had financially squeezed the insurer.

Med Mutual’s bottom line: Total claim payouts shot up from $56 million in 2002 to $93 million in 2003, with those amounts including paid legal defense costs.

“This rate increase is due to relentless pressure caused by soaring rate payouts,� the company told doctors in the notice. “We regret the impact the premium increase will have on your practice. At this time, however, we have no choice but to take this significant rate increase.�

The bottom line: Doctors witnessed their premium payments double and even triple, prompting them to rally for relief in Annapolis before the 2005 General Assembly session.

Limited relief short-lived

In December 2004, during a special legislative session, representatives considered an array of proposed laws. Some called for lowering caps on jury awards in medical malpractice cases. Others called for regulations to make premiums more affordable for doctors.

However, in the end, the major legislation passed essentially created a subsidy program in which the state absorbed part of the medical malpractice insurance costs incurred by physicians.

And that law expires at the end of 2007.

“It (the law) resulted in a modest decrease in premiums, but it’s only temporary relief,� Ma noted. “The cost of medical malpractice insurance is still same, they just gave a discount on the annual bills. The discounts are subsidized by state tax revenue, specifically from the state smoking tax.�

That relief appears to be ending, though, according to Dr. Elizabeth P. Lowe, a general surgeon who performs gall bladder removal, hernia repairs, breast and bowel operations and other procedures.

Lowe started practicing medicine in July 2002, setting up her own office in the medical arts building near Union Hospital in Elkton. Within two years, she found herself in the insurance rate crunch.

The surgeon watched her annual premium jump from $4,500 for 2003 to $16,000 for 2004.

Then for 2005, Lowe’s annual payment soared to $49,700. That’s $33,000 more than she paid in the previous year, a 200-percent increase. Her premium — doctors can pay them in four increments — devastated Lowe, who wondered if she could stay afloat.

“Fifty thousand dollars, that’s a lot of money. I’m a small business owner, so I don’t have that kind of money laying around,� Lowe said in November 2004, adding, “I’m still hoping I can stay in business.�

Relief came in November 2005, however, when her annual insurance bill showed a $46,198 premium for 2006 coverage, $3,500 less than Lowe paid the previous year.

Possibly playing a role in the decrease, Med Mutual’s claim payouts and legal costs dropped from $93 million in 2003 to $78.5 million in 2004, the start of a downward trend.

But the slack didn’t last long, even after Med Mutual’s claim payouts and legal costs dropped to about $53 million in 2005, some $3 million less than in 2002.

When Lowe’s annual insurance bill for 2007 arrived last month, the surgeon felt the same eye-opening crunch that she experienced two years ago.

Lowe now must pay $60,665 — some $14,000 more than for 2006 — to maintain her practice this coming year. And that figure reflects a 5 percent discount Lowe earned for attending a one-night Med Mutual seminar.

“It (the law) helped a little bit that first year, but it’s gone up again,� Lowe said. “Hopefully, I’m going to be able to stay here. I don’t know what my bill will be next year, but I just assume it’s going to be more than the last one.�

Calling Lowe’s situation a “perfect example� of the continuing crunch for local doctors, Ma commented, “(The law) had very little impact. It was just symbolic.�

Recruitment nearly impossible

Maryland’s high medical malpractice rates, meanwhile, are keeping prospective doctors away.

Nationwide recruitment efforts have been challenging for more than two years, Ma said, adding that a doctor deficient continues based on AMA population standards.

To illustrate the uphill battle, Ma recalled how a Delaware obstetrician-gynecologist recently considered moving his practice to Cecil County — only to discover that it was economically impossible.

“He was a qualified physician, very experienced. He’d been practicing for more than 20 years,� Ma said.

The candidate’s experience, however, turned out to be a double-edged sword.

According to Ma, the longer doctors practice in this litigious country, the more likely it is that they will be named as a defendant in at least one medical malpractice lawsuit.

And win, lose or case dismissed, merely being sued is enough to send a doctor’s medical malpractice premiums soaring.

“If you’ve been practicing for 20 years, you can count on (legal) cases against you. That’s just the way it is, and it was no different in his case,� Ma said, emphasizing, “But he is still a very qualified doctor.�

Nevertheless, had the doctor elected to practice medicine in Cecil County, his annual insurance premium would have been $150,000, according to Ma, noting, “That’s more than half his annual salary.�

In trying to strike a deal, the medical community here looked into absorbing a portion of the candidate’s insurance cost, but it wasn’t financially feasible, Ma said.

Overall, according to Ma, while the state law passed in 2005 helped established doctors — for a while, anyway —it didn’t improve recruitment efforts.

“At the very least, it (the law) stabilized the doctors who were already here. It gave them a willingness to stay in this area and practice,� Ma said. “But as far as recruitment, malpractice insurance is still a major hurdle.�

“We have needs in every specialty, but some are more critical than others. And the thing is, we’re not unique. This is happening all over the country, not just in this county. There needs to be major reform.�
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