Ohio: First Time in Five Years, Medical Liability Insurance Rates for Decline

Ohio Department of Insurance Director Ann Womer Benjamin announced that American Physicians Assurance Corporation has filed a medical liability rate decrease of 3.6 percent, effective Nov. 1, 2006. A total of four of the state’s five largest medical malpractice insurers have filed rate changes producing an average decrease of 1.7 percent in 2006. This year’s combined rate decrease follows rate increases of 30 percent in each of 2002 and 2003, 20 percent in 2004 and 6.7 percent increase in 2005.

“Stabilizing measures taken in the last few years by the Ohio Department of Insurance and the Ohio Legislature to reverse Ohio’s medical liability insurance crisis continue to show positive results,” Director Womer Benjamin said. “We are still closely monitoring the market and rates to ensure Ohio’s health care delivery system remains functional.”

Already this year, Medical Protective Company became the first major medical malpractice insurer since 2000 to lower its rates in Ohio after the Department accepted its 5 percent decrease. The Medical Assurance Company followed a four-year trend of moderating increases with a rate revision averaging zero percent for its policyholders. The OHIC Insurance Company increased its rates by only 2.3 percent after six years of double digit increases.

Stabilizing measures taken by the Ohio Department of Insurance and Ohio Legislature:

Tort reform: Medical malpractice non-economic damages were capped in 2003 by tort reform legislation. The measure was taken to control costs, since premiums are driven primarily by claims costs and lawsuit defense and settlement costs.
Data collection: The Department for the first time is collecting medical liability data as required by a new law. The data, which includes insurers’ costs of defending medical liability claims and paying judgments and settlements, will allow for more precise monitoring of the market and more informed policy decisions. A data report will be issued soon.
Rate review: A new rule proposed by the Department and recently enacted requires medical liability insurers to justify their rates to the Department every year, even if no changes are contemplated.
Ohio Medical Malpractice Insurance Commission: The Commission – chaired by Director Womer Benjamin – issued its final report in April 2005 to Governor Taft, the Ohio Legislature and other interested stakeholders. The report suggested the creation of a “patient safety center” to help prevent medical errors, a pilot medical malpractice docket for lawsuits, and alternative dispute resolution mechanisms, among other measures.

Source: Ohio Department of Insurance news release

Posted: Friday, October 13, 2006 12:00:00 AM. Modified: Monday, November 13, 2006 3:55:39 PM.

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