Real Legislative Solutions

At the same time doctors and hospitals are being squeezed by their malpractice insurers, they are also facing reduced reimbursement rates from Medicaid, Medicare and HMOs.  Any effective solutions to the medical malpractice insurance affordability and availability problem must address these factors.  The Legislature should:

Explore the creation and promotion of new doctor and hospital owned insurance vehicles – physician and hospital group mutuals, trusts, captives and risk retention groups.  In March of 2002, Joe Parker, President of the Georgia Hospital Association was quoted in the Atlanta Business Chronicle as saying that within the next few weeks the GHA would roll out a medical malpractice captive product which in the long run would save hospitals money and would allow them to recoup any money not spent.  To date, GTLA is unaware of any such concept actually being implemented or created.  Such insurance options would give physicians and hospitals more control over premiums, risk management and litigation decision-making.  Insurance industry experts have said that these can be created with relative ease and without as much capital as one might expect.  Notwithstanding MAG Mutual’s conduct of late, experience shows that doctor owned companies can withstand the predatory practices of the insurance industry and the drastic cycles of the insurance market.

Create a market assistance plan whereby the state would act as a broker to place those physicians and hospitals that cannot find coverage.

Require stricter and more detailed filing requirements by malpractice insurers to gauge when they are under pricing and to forecast the need for moderate increases in premiums before an economic downturn. 

Implement tax incentives and breaks for insurance carriers to attract more carriers to be domiciled in this state.  Georgia’s premium tax is the third highest in the nation.  It has caused at least eight insurance companies to move their domicile to states other than Georgia.

Consider raising Medicaid, Medicare and HMO reimbursement rates, especially for rural healthcare providers and for ‘high risk’ specialties.

Require closer oversight by the Department of Insurance in connection with the raising or lowering of premiums.

Vest the Insurance Commissioner with authority to place limitations on how premiums can be set with the manipulation of credits and debits.   

Give real teeth to “prompt pay” laws.

Reduce the incidence of malpractice by all means possible including passing legislation increasing nurse to patient ratios, making mandatory the reporting of medical errors and narrowing or eliminating peer review.

Focus on civil justice changes that result in the more efficient and timely resolution of malpractice cases and the reduction of frivolous claims and defenses.  

Eliminate the insurance industry’s exemption from antitrust laws so as to preclude them from engaging in anti-competitive conduct that fixes prices and prevents physicians and hospitals from having any equality in bargaining power.

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