Alliance of American Insurers’ senior vice president and General Counsel Ann Spragens sent the following letter to the editor of the Chicago Tribune. In it, she attempts to correct the reported common misconception about the cause of the medical malpractice insurance crisis.
To the editor:
It was only a matter of time before someone suggested it is the insurance industry that is “really” to blame for the medical malpractice crisis, as Molly Ivins did in her column in the Tribune Jan 24.
Doctors are facing medical malpractice premiums that have spiked at an alarming rate recently, and surely are being asked to do so because of insurer greed, incompetence and investment failures, right?
Wrong. At this time, approximately 60 percent or more of all doctors are insured by doctor-owned insurance companies, a dramatic change from even 20 years ago when large commercial insurers held dominant market shares in this line, as they had for many years. The change to doctors insuring doctors came when physicians encountered problems in the 1970s and 1980s, and decided to set up their own companies because they thought they could do better for themselves. Doctor groups, including medical societies across the country, responded to form mutual insurance companies to insure themselves and their colleagues, and have gradually become the dominant source of malpractice coverage for the profession.
This fundamental change in who doctors are insured by makes it difficult to convince physicians that the latest crisis is the fault of their insurance company, because more often than not they ARE the insurance company. Charges of incompetent insurer management, corporate greed, poor investment strategy and weak antitrust rules no longer have any persuasive power in these circumstances.
Nor should they. What doctors now know is that malpractice insurance reflects the liability system in its economic totality. To blame insurers, whether mutuals or not, merely blames the mirror for the truth it shows us.
Senior Vice President and General Counsel
Alliance of American Insurers
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