NEVADA: MALPRACTICE RATES INVESTIGATED
A consulting firm hired by a legislative study panel toThis is part of the California Healthline Daily Edition, a summary of health policy coverage from major news organizations. Sign up for an email subscription.
investigate malpractice insurance in Nevada says that the state's
three malpractice insurers "have had big rates hikes" over the
past three years, but are "still unprofitable." The report was
prepared by Robert Finger of the consulting firm of Milliman and
Robertson Inc., LAS VEGAS SUN reports.
BACKGROUND: The legislative study committee was created to
investigate the firms -- The Doctors Company, Nevada Medical
Liability and Medical Insurance Exchange of California -- in 1995
after physicians claimed that their malpractice insurance had
risen so sharply that some doctors were forced to leave the
profession. The committee is headed by state Rep. Jack Close (R)
and has contracted another firm, AIS Risk Consultants Inc., to
conduct further investigation into the matter. AIS's report is
expected by the end of September.
THE FINGER REPORT: The report indicated that "the three
insurance companies tend to put too little aside in a reserve
fund at the initial filing of a claim. But the reserves at the
end of the case may be a 'little' too high." Finger reported
that the cost of a claim "rises about nine percent per year"
while the estimated average "rise in premiums paid by doctors on
medical malpractice insurance" has been 4.9% in recent years.
Medical malpractice insurance rates have risen more than 60%
since 1985. State Senator Mark James (R) "said he wanted to see
the actual financial statements of the companies." He said that
Finger's data was theoretical and he needed "hard data." The
study committee is scheduled to make its recommendations in
October (Ryan, 8/7).