About those malpractice insurance rates…
Bush was in the Midwest last month and pointed to an area doctor who’s finding it difficult to keep up with rising premiums for malpractice insurance.
“Dr. Chris Heffner is with us. He’s a neurosurgeon from Belleville Memorial and St. Elizabeth Hospitals…. He is one of only two neurosurgeons still practicing south of Springfield, Illinois. You’ve got two people in the area. In just two years, his annual premiums have more than doubled, from $131,000 a year to $265,000 a year.”
The president was even gracious enough to explain the problem, as he sees it: “Many of the costs that we’re talking about don’t start in an examining room or an operating room; they start in a courtroom.”
Was Bush painting an accurate picture about why these premiums have risen? Of course not.
[F]or all the worry over higher medical expenses, legal costs do not seem to be at the root of the recent increase in malpractice insurance premiums. Government and industry data show only a modest rise in malpractice claims over the last decade. And last year, the trend in payments for malpractice claims against doctors and other medical professionals turned sharply downward, falling 8.9 percent, to a nationwide total of $4.6 billion, according to data compiled by the Health and Human Services Department.
[…]
Lawsuits against doctors are just one of several factors that have driven up the cost of malpractice insurance, specialists say. Lately, the more important factors appear to be the declining investment earnings of insurance companies and the changing nature of competition in the industry.
The recent spike in premiums – which is now showing signs of steadying – says more about the insurance business than it does about the judicial system.
As the NYT article explained quite well, over the last decade, malpractice insurance premiums “rose modestly and sometimes even dropped as the insurance companies battled for market share in a scramble to collect more money to invest in strong bond and stock markets. But when the markets turned sour and the reserves of insurers shriveled, companies began to double and triple the costs for doctors.”
Funny how Bush leaves out these details when railing against “junk lawsuits.”