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Premiums putting pinch on physicians, hospitals alike

By By Paul Keane
Publisher
While the thought of doctors and surgeons walking out on their jobs is rather vague in Alabama, the fact that professional liability insurance premiums keep climbing is a reality, even in Atmore.
Surgeons in West Virginia walked off the job earlier this week due to increasing professional liability – commonly called malpractice insurance – premiums. Some of the surgeons said their premiums had risen to as much as $150,000 a year.
Bob Gowing, administrator of Atmore Community Hospital, said the concern is felt across the nation.
"The increase in premiums is a concern nationwide," he said. "And this is not just a healthcare of an insurance issue, but it's a legal issue as well. It's a matter of addressing tort reform in this state and other states in order to get things in line."
While admitting that the impact of premium increases is not as great in this area as others, Gowing did point out that the premiums for ACH rose by more than 25 percent over the past year, causing himself and other administrators to do some juggling with the budgets.
"In many cases, you don't adjust for those kind of increases," he said. "You either eat it as a loss or you cut expenses in other areas to make up the difference. With a hospital the size of ours, that's hard to do without running the risk of cutting services."
Doctors in Mississippi – especially those towns bordering other states – have left the state and set up practice in a neighboring state such as Louisiana. Gowing said while that probably wouldn't happen here, he does understand physicians looking to relocate due to the high premiums in many states. He added that solid tort reform would help control those costs.
Tim Godwin, a local attorney who is a member of both the Alabama Trial Lawyers Association and the Association of Trial Lawyers of America, says that tort reform is in place in Alabama, and that medical errors has led to an increase in premiums.
"First of all, let me say that we don't handle a lot of medical malpractice cases here in our office," Godwin said. "We refer a lot of those out to attorney who specialize in those cases.
"But in 1987, there was a tort reform package passed and that, particularly in medical malpractice, limits damages and restricts discovery procedures. I feel there are some protections in place that tilt it in favor of the healthcare profession."
Godwin also pointed to reports this summer that showed a high number of medical errors resulting in injuries and deaths around the nation.
"Surely, there is a connection between the release of more information on medical errors and the rise in premiums," he said. "And after the Sept. 11 terrorist attacks, there were a large number of claims and potential payouts that hit the insurance agency. It seems at times like the insurance companies are trying to spread their losses across the board. I think that's directly related, whether the insurance industry admits it or not."
Godwin was also quick to point out that most of the clients he meets think they have a malpractice claim, but it turns out not to be the case.
"We do talk to a number of people who are dissatisfied with their medical treatment and may have lingering effects," he said. "Once we investigate and dig into the situation, though, we find that many of these people have a disagreement with the bedside manner of the physician.
"When you are dealing with medical issues, you are dealing with personal matters that are very emotional, and some people don't like the way their physician handles their case on a personal level. We tell a lot of people that come into our offices that they really don't have a malpractice claim."
Godwin added that he has not seen a spike in professional liability insurance premiums for attorneys.
"I haven't heard any complaints in talking with colleagues and other attorneys," he said. "I do know that more and more attorneys are now specializing in professional liability cases, though."