Murray State University
Socio-economic Impacts of Rising Medical Malpractice Premiums: Investigation of the Causes and Legislative Efforts Toward Stabilization
Institution
Murray State University
Faculty Advisor/ Mentor
Pamela E. Brewer
Abstract
My research attempts to discover why medical malpractice insurance premiums have escalated to a threshold that is causing some hospitals (recently two here in Kentucky) to close their obstetrics departments, and forcing physicians to either relocate or simply stop practicing medicine. In addition to loss of services, negative socio-economic impacts include restricted choice, loss of jobs, and higher health insurance costs. What legislative efforts are being proposed toward regulations that would alleviate current and future crisis? I initially hypothesized a correlation between lobbyist spending by the insurance industry and votes against regulatory legislation. Opinions published on the websites of numerous organizations like the American Medical Association, Congressional Budget Office, National Association of Medical Insurance Carriers, attorneys, advocacy groups, and legislators point to skyrocketing jury awards as a primary cause for the medical malpractice insurance crisis. My investigation when testing the jury awards theory, revealed a study by Americans for Insurance Reform (AIR: a non-profit, non-partisan project of the Center for Justice and Democracy) that indicates no evidence of surging jury awards. AIR’s findings demonstrate a direct correlation between the rise and fall of medical malpractice premiums and the insurance industry’s economic cycle. The Congressional Budget Office also recognizes this as one of several forces impacting premiums. A representative from Senator Bunning’s Washington, D.C. office did not know if the Senator knew of AIR’s findings but confirmed that H.R. 4280, containing various reliefs including caps on awards, recently passed the House but would not even be debated in the Senate.
Socio-economic Impacts of Rising Medical Malpractice Premiums: Investigation of the Causes and Legislative Efforts Toward Stabilization
My research attempts to discover why medical malpractice insurance premiums have escalated to a threshold that is causing some hospitals (recently two here in Kentucky) to close their obstetrics departments, and forcing physicians to either relocate or simply stop practicing medicine. In addition to loss of services, negative socio-economic impacts include restricted choice, loss of jobs, and higher health insurance costs. What legislative efforts are being proposed toward regulations that would alleviate current and future crisis? I initially hypothesized a correlation between lobbyist spending by the insurance industry and votes against regulatory legislation. Opinions published on the websites of numerous organizations like the American Medical Association, Congressional Budget Office, National Association of Medical Insurance Carriers, attorneys, advocacy groups, and legislators point to skyrocketing jury awards as a primary cause for the medical malpractice insurance crisis. My investigation when testing the jury awards theory, revealed a study by Americans for Insurance Reform (AIR: a non-profit, non-partisan project of the Center for Justice and Democracy) that indicates no evidence of surging jury awards. AIR’s findings demonstrate a direct correlation between the rise and fall of medical malpractice premiums and the insurance industry’s economic cycle. The Congressional Budget Office also recognizes this as one of several forces impacting premiums. A representative from Senator Bunning’s Washington, D.C. office did not know if the Senator knew of AIR’s findings but confirmed that H.R. 4280, containing various reliefs including caps on awards, recently passed the House but would not even be debated in the Senate.