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My Turn
Death by Malpractice Premium
Clinton Miller
Publish Date: October 10, 2007

Surgeons who practice high-risk specialties are being crushed by astronomical malpractice insurance premiums and plummeting third-party payer reimbursements. This economic vise grip is driving established specialists out of practice and preventing medical students from entering high-risk fields. If we don't do something fast, there won't be enough surgical specialists, and patients will lose access to the quality, on-demand health care they've come to expect.

Neurosurgery, for example
Take my own specialty of neurosurgery. More than 800 neurosurgical positions in the United States are vacant. It takes 30 months to recruit a neurosurgical specialist in Massachusetts. For the first time, most if not all of the country's major neurosurgical residency training programs have unfilled positions. Medical students know that if they choose a high-risk medical specialty, they won't earn a decent living.

My experience is a case in point. My practice includes three surgeons who provide 24-7, 365-day coverage to six hospitals. Last year, I saw 380 new patients and 450 established patients, performed more than 146 inpatient brain and spinal procedures and took emergency call every third day. I typically worked 70-hour to 80-hour weeks. I received an average reimbursement of 48 cents on the dollar from all my third-party payers, or just $320,000 of the $720,000 that I billed. After paying my share of my office employees' salaries and benefits, rent, utilities and other expenses, as well as my $84,151 malpractice insurance premium, my after-tax take-home pay was $64,000 - nearly one-third less than my malpractice premium.

How do you spell relief?
I propose several steps to reduce malpractice insurance premiums:

  • Educate the public that pre-set reimbursements prevent physicians from participating in free-market capitalism. Trial lawyers who say physicians should deal with skyrocketing malpractice insurance premiums by raising prices are self-serving.
  • Put reasonable statutory restraints on malpractice litigation. This will drive insurers to lower premiums.
  • Mandate pre-trial screening panels for medical malpractice cases in every state. These panels accelerate claims resolution fairly. A unanimous finding for the plaintiff incentivizes the physician and insurer to negotiate an early settlement; a unanimous finding for the defendant should cause the plaintiff's counsel to reconsider the merits of the case. In Maine, where such a panel has been in place since 1985, medical malpractice insurance premiums are 40 percent lower than in New Hampshire. Since the panel's inception, the state's dominant medical malpractice insurer has taken to trial just two cases in which the pre-trial panel found for the plaintiff; both cases resulted in exoneration of the physician.

The time has come for our society to decide what it values more: access to high-quality health care on demand, or the continuation of open season for trial lawyers who prey on the human imperfections of even the most well-intentioned and highly skilled surgeons.