State Watch | Kaiser Daily Health Policy Report Highlights Recent Medical Malpractice Developments in Four States

Summaries of recent developments related to medical malpractice in four states appear below.

* Indiana: The rates that physicians pay to participate in the state Patient’s Compensation Fund will decrease by 19.1% next year, and the rates that hospitals pay will decrease by 1.3%, according to the Indiana Department of Insurance, the Indianapolis Star reports. The decreases, the first since the establishment of the fund in 1976, will take effect in March 2008. Physicians and hospitals that decide to participate in the fund receive $1 million more than the $250,000 in malpractice insurance that they must obtain on the private market. In addition, participation in the fund caps their medical liability at $1.25 million. The fund also provides compensation for patients injured by health care providers (Lee, Indianapolis Star, 12/14).

* Maryland: The Medical Mutual Liability Insurance Society of Maryland, the largest malpractice insurer in the state, last week announced plans to use an almost $100 million dividend to reduce malpractice insurance premiums for physicians by 8%, pay physicians $13.8 million in credits against premiums for 2008 and return $84 million to the state for emergency subsidies, the Baltimore Sun reports (Salganik, Baltimore Sun, 12/14). State Insurance Commissioner Ralph Tyler last month ruled that Med Mutual, which had declared a $68.6 million dividend, should return the full amount to the state. However, Tyler allowed Med Mutual 30 days to develop an alternative plan. Med Mutual said that conditions in the malpractice insurance market have since improved and allowed them to declare a larger dividend (Dominguez, AP/Washington Times, 12/14).

* New Jersey: The state Medical Malpractice Liability Insurance Premium Assistance fund plans to pay $16.4 million in subsidies to help physicians in the highest-risk specialties cover the cost of malpractice insurance, state Banking and Insurance Commissioner Steven Goldman announced last week, the Newark Star-Ledger reports. According to Goldman, physicians who accept the subsidies must continue to practice in the state for two years. The state as of Dec. 14 had sent checks to 1,200 physicians (Livio, Newark Star-Ledger, 12/15).

* New York: The 475 physicians in the state who participate in the state Medical Malpractice Insurance Plan, which provides malpractice insurance to those who cannot obtain coverage in the private market, might have to pay significantly higher premiums because the fund has a $525 million deficit, Long Island Newsday reports. According to the state Insurance Department, the deficit indicates a “looming insurance industry crisis,” as malpractice insurers must cover the cost. A Medical Malpractice Task Force has begun to evaluate the fund and plans to send a report to Gov. Eliot Spitzer (D) by the end of the year (Ochs, Long Island Newsday, 12/17).
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