AAMC Magazine

Fall 2004

Malpractice: The Numbers in Black and White

Hospitals

Maryland hospitals’ medical liability insurance costs rose $40 million in the past two years. Many hospitals have been forced to self-insure. (1)
In the last five years, six insurers have either gone bankrupt or ceased writing medical liability insurance for hospitals in Maryland. Nine more have received rating downgrades. (1)
The largest insurer for hospitals, OHIC, announced this spring that it is leaving Maryland. (1)
Hospitals aren’t the only healthcare facilities affected. Nursing homes in Maryland are staggering at an almost 400 percent insurance increase over the last four years, from $4.5 million in 1998 to over $16 million in 2002. (1)

Physicians

Medical Mutual Liability Insurance Society of Maryland (Med Mutual) plans to increase premiums for obstetricians-gynecologists to $160,130 next year, up from $115,919 this year. Obstetrics-gynecology leads other specialties in highest premiums, followed by neurosurgeons who paid $87,860 this year and will pay $121,464 next year. (3)
Not one of the 150 graduates of the University of Maryland School of Medicine last year chose an obstetrics residency. Only one did this year. (1)
Since 1996, graduates of U.S. Medical schools who enter training programs in obstetrics and gynecology have dropped 23 percent from 968 to 743. (3)
This year, just two-thirds of new residencies in obstetrics and gynecology nationwide were filled by graduates of U.S. medical schools, down from 86 percent eight years ago. (3)

Insurers

Medical Mutual, located in Hunt Valley, insures about 6,200 doctors in the state, about 80 percent of those caring for patients. (3)
Last year, the Maryland State Legislature granted Med Mutual a 28 percent rate increase. This year Med Mutual has asked the legislature for an additional 41 percent rate increase. (4)
During the last four years, the total annual amount paid out by Med Mutual, the largest medical malpractice insurer for doctors in the state, jumped from $47 million to $74 million, and the number of million-dollar-plus payouts tripled. (2)
Med Mutual’s Chief Operating Officer Jeff Poole said rates have increased because of a sharp rise in malpractice claims: from $49.5 million in 2001, to $93 million last year. He says more generous jury awards, not more lawsuits, account for the jump. (4)
In 1996, there were 14 carriers actively writing physician medical liability insurance policies in Maryland. Today, Med Mutual is almost alone. (1)

Consumers

The number of specialists in fields such as obstetrics and gynecology, neurosurgery and orthopedic surgery, is declining, meaning patients will have to travel farther and have longer waits to receive medical care.
Patients retain only 43 percent of jury awards in Maryland. The rest goes to attorney’s fees and litigation expenses. (1)

SOURCES:
(1) Maryland Hospital Association
(2) Press Release from the Governor’s Office, Friday, June 25, 2004
(3) Baltimore Sun, July 11, 2004
(4) Washington Post, July 1, 2004

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