Instead, blame jury awards and settlements for jumps in malpractice insurance premiums, the state Cabinet is told.
By Associated Press
Published June 27, 2003
TALLAHASSEE - The state's insurance regulation chief told Gov. Jeb Bush and the Cabinet Thursday that medical malpractice insurers aren't using rate increases to make up for losses in the stock market.
Premiums for malpractice insurance for doctors have gone up dramatically, leading doctors to push for changes. Both the regular session and a special session of the Legislature have failed to solve the problem, and Bush plans to call lawmakers back to Tallahassee July 9 to work on it.
Insurance companies say rates are being driven up by excessive settlements and jury awards in lawsuits. They, along with doctors, are pushing for limits on malpractice damages and other changes meant to lower settlement costs.
But lawyers who represent malpractice victims and generally oppose limits on damages argue that damages aren't going up as much as insurance companies claim, and when adjusted for inflation haven't increased at all.
They have argued that insurance companies are raising rates to make up for soft returns in securities markets. Some legislators have also advanced that idea.
Kevin McCarty, the state's director of insurance regulation, rejected that argument during a brief discussion of malpractice rates at the Cabinet's regular meeting Thursday.
"There are very important provisions in the Florida insurance code that protect against just those kinds of recoupments," McCarty said. He said his office rejects rate increases that would load investment losses into rates, which is against the law.
"The issue is not a matter of economic losses from investments," McCarty said. "The loss ratio is attributable to higher settlements."
In other action, the Cabinet approved construction of a pipeline from a Palatka paper mill to the St. Johns River that would be built only if other treatment measures do not reduce pollution now flowing into Rice Creek.
The Georgia-Pacific mill has begun a $74-million project that is "80 percent" likely to sufficiently treat the salty, dark wastewater flowing into the creek to meet regulatory standards, said general manager Ted Kennedy.
But if the treated wastewater still isn't meeting standards set by the Environmental Protection Agency, the company would build the 4-mile pipeline into the St. Johns River.
The wastewater would meet standards if pumped into the St. Johns because the river's volume and flow are much greater than Rice Creek's and would dilute the wastewater more.
Attorney General Charlie Crist voted against the pipeline, saying he wanted assurance that the company would not increase the amount of pollutants discharged.
Agriculture Commissioner Charles Bronson said the company would need approval from multiple agencies if it increased the amount of pollutants it discharges.
