AAOS Bulletin - April, 2006

In Brief


Arizonans for Access to Health Care (AAHC), a group formed by the Arizona Medical Association, has decided not to try for a constitutional amendment setting caps on noneconomic damages. Arizona’s constitution currently prohibits limiting recoverable damages; no caps can be passed until the constitution is amended. The AAHC stated that a poll of state residents showed lack of support on the issue.


A major California insurer, CAP-MPT, has announced a reduction in physician medical liability assessments. The company credited this drop to a decrease in the number of medical liability claims the past year, and lower costs because of the increased use of pretrial binding arbitration. CAP-MPT also noted that it added 650 doctors the past year, which allowed it to spread risk over a larger number of physicians.


In response to Florida’s growing on-call crisis, some of the top health systems in the state have developed a plan that would allow hospitals to create regional on-call schedules for doctors. The group is working to obtain federal antitrust approval before proceeding with the plan.


The American College of Surgeons (ACS) has announced that it will boycott Georgia as a site for conventions or meetings until the state changes its policy on Certificates of Need (CONs). Currently, single-specialty physicians can open ambulatory surgical centers without going through the CON process, but general surgeons are not considered to be single specialty. After the ACS made this announcement, the Georgia Health Strategies Council voted to table a motion to define general surgery as a single specialty. The issue probably will not be addressed again until a state-created CON commission issues its report in June 2007.  

The Georgia Supreme Court ruled that change of venue provisions included in Georgia’s 2005 tort reform act are unconstitutional. The law allowed defendants to decide on the venue, but the court ruled that the state constitution gives the power to change venue to the courts, not to the defendants.


A bill aimed at curbing medical liability insurance premiums for physicians was derailed at the last minute when an amendment was added calling for a state constitutional amendment. The measure originally provided for pretrial review of medical liability lawsuits and the establishment of a state-run insurance carrier. As the bill neared a House vote, it was amended to scrap the state-run carrier and substitute a constitutional change to ensure that lawsuit-screening measures such as mediation wouldn’t be thrown out by the courts. However, the amendment prompted House leaders to reassign the bill to committee, effectively ending its chances for passage.


The Massachusetts legislature is considering a bill that would ban all drug industry gifts to medical professionals. The sponsor of the legislation, State Senator Mark Montigny (D), said, “If a doctor needs a Caribbean vacation or a mug or a pen, he or she is probably not very successful and needs to be in another business.” A spokesperson for the Pharmaceutical Research and Manufacturers of America has criticized state involvement in this issue, saying that gifts help sales reps get needed time with physicians and their staffs.


Ohio physicians experienced an average medical liability insurance rate increase of 6.7 percent the past year, and are likely to see only single-digit increases again this year. The National Association of Insurance Commissioners reported that Ohio medical liability insurers posted a 25.8 percent profit margin in 2004. Recent changes that may be responsible for the improvement include a $500,000 cap on noneconomic damages passed in 2003 and increased state scrutiny of rate increases by insurers. The Ohio Department of Insurance also is seeking to require that insurance companies justify their rates in years that they do not ask for an increase.


Once again, medical liability insurance rates are dropping for Texas physicians. One of the state’s largest insurers, Medical Protective Company, attributed its rate cut to recent tort reforms. Also, the insurer was recently bought by Berkshire Hathaway, Inc., allowing it to have the highest financial rating and to expand its underwriting.


The Utah legislature recently passed a bill that would allow physicians to make expressions of sympathy without their apologies being held against them in court. However, experts are cautioning physicians not to rely on the bill because of procedural issues; some are claiming that the law changes rules of evidence, and thus requires a joint resolution passed by a two-thirds majority.


After Washington state medical providers and attorneys were unable to convince voters to support either of their separate ballot initiatives the past November, both sides have achieved some measure of compromise on tort reform. The bill does not include either caps or “three strikes” provisions of the ballot initiatives. However, it does include these provisions: expression of sympathy protection, mediation and arbitration provisions, collateral source reform and a requirement that plaintiff claims would have to be reviewed to prevent frivolous lawsuits. The state medical association acknowledged that this is just the first step in a continuous process of reform.

This roundup was prepared by Bruce Allain, JD, a legislative analyst in the department of socioeconomic and state society affairs. He can be reached at allain@aaos.org

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