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After the Legislature passed a version of malpractice insurance reform in four tries, the premiums aren't going down. They're just going up more slowly.
When lawmakers in August settled on a medical malpractice insurance plan they needed four angry sessions to complete, Gov. Jeb Bush was ebullient. "I think historians will look back and say, "Job well done,' " Bush said then. "I'm confident this will bring a reduction in insurance premiums."
As it turns out, "reduction" is a relative term.
The state Office of Insurance Regulation delivered some less-than-historic news last week, acknowledging that malpractice insurance rates will increase next year, most likely by percentages in the double digits. Two insurance companies confirmed as much, telling newspapers they will ask for rate increases of between 21 and 25 percent. But here's where the fine print comes into play. The "reduction" the governor and Legislature touted is actually a reduction in the increase. For 2004, the insurance office reported, rate increases must be reduced by 7.8 percent, which under the law is the "presumed" savings that attach to new limits on jury awards to patients who have suffered from malpractice and limits on the exposure of insurance companies.
This is no small distinction. Soaring insurance premiums were the very reason the Legislature was called upon to act, because many physicians, especially emergency room and pediatric specialists, were being driven out of practice by annual premiums that exceed $100,000. The premiums themselves are the threat, which is one reason Florida Medical Association president Carl Lentz was being quoted again last week as saying, "If we don't have some relief in medical-liability insurance costs, we're going to have a continuing exodus of doctors."
Admittedly, the malpractice insurance crisis has no easy fix. There is some cause for some optimism: Two new companies are writing policies, and two more are on the way (competition can only help). But the changes the Legislature adopted in August required considerably more sacrifice from doctors and consumers than they asked of insurers. Insurance companies escaped the attempts to roll back their rates or establish a competing state-run insurance pool. At the same time, the changes gave them more time to dicker with policyholders over whether to settle or fight a lawsuit.
The presumed "reduction" that will now apply to malpractice insurance rate increases is arguably better than no restraint at all. But if this is the first step in ending the medical malpractice crisis in Florida, it is at best an unsteady one.