FTCR study says malpractice insurers inflated losses
Physician Practice Advisor, January 11, 2006
Insurance companies inflated losses by 46% on average during the mid-1980s, says the Foundation for Taxpayer and Consumer Rights (FTCR) who released a 17-page study on the subject at the end of December. "By inflating their estimated 'losses' . medical malpractice insurance companies have misled regulators, lawmakers, and the public and overcharged physicians and other healthcare providers," said FTCR's Harvey Rosenfield.
However, medical malpractice insurance companies say the non-partisan FTCR study was funded by tort lawyers, who sue doctors and hospitals in malpractice cases and want to prevent malpractice tort reform. "They want to blame all the system's ills on the evil insurance companies," says Lawrence Smarr, president of the Physician Insurers Association of America (PIAA). "But over 50% of the medical malpractice insurance sold is by insurance companies that are owned and operated by providers-why would they collude to overcharge themselves?"
The FTCR study analyzed the Annual Statement insurers submitted to regulators from 1986 to 1994. The report compared the dollar amount medical malpractice insurers initially reported they paid out on polices to what was actually paid out in claims during that period.
