Battle Looms Over Ga. Medical Liability Reform Legislation, Its Effect on Premiums

Storm clouds are looming over medical liability reform legislation about to be introduced in the 2005 Georgia General Assembly which would make it harder for insurance companies to raise their rates and thus, supposedly reduce premiums.

Non-partisan groups, representing neither Georgia doctors nor their patients believe pre-filed legislation wouldn’t have any effect on insurance premiums.

The bill, sponsored by Senate Majority Whip Mitch Seabaugh, R-Sharpsburg, would require insurance companies to submit rate hike requests to Insurance Commissioner John Oxendine. Proposed increases of 10 percent or greater would be subject to an investigation by the commissioner’s office and the commissioner could hold a public hearing on requests to raise rates by more than 25 percent.

Glen Allen, spokesman for state Insurance Commissioner John Oxendine, said the Commission’s staff had not reviewed the bill.

The Senate passed legislation during this year’s session containing several changes in the legal system governing medical malpractice lawsuits, including stricter requirements for expert witnesses and some liability protections for emergency rooms. But the bill died when negotiations with the House faltered.

During weeks of debate over that bill, patient advocates suggested that insurance reform would do more to reduce malpractice premiums than putting limits on lawsuits.

They pointed to California’s Proposition 103, an insurance reform measure enacted in 1988, which is credited with saving ratepayers there billions of dollars.

In a statement Georgia Watch called Seabaugh’s bill “a step in the right direction” but noted that it would fall short of the California law, which allows public hearings on proposed rate hikes of 15 percent or more.

“Proposition 103 in California — a model for insurance reform — is the only proven way to successfully lower malpractice premiums for physicians,” Georgia Watch spokesman Matthew Monroe said.
David Cook, executive director of the Medical Association of Georgia, told the Gwinnett Daily-Post that Seabaugh’s bill wouldn’t solve the problem of rising malpractice rates, but for a different reason.

He argued that medical liability reform is the only way to lower huge premium increases that are driving some Georgia doctors — particularly those in higher-risk specialties — to retire or leave the state.

“These things are very good. … But they’re not going to amount to a whole lot in reducing premiums,” said Cook, whose group represents doctors across the state. “They’re good (public relations). People don’t like insurance companies. … It shifts the debate from lawyers to insurance companies.”

Sen. Preston Smith, R-Rome, who is a co-sponsor of Seabaugh’s bill, said the measure demonstrates the willingness of Senate Republicans to consider other solutions to high malpractice premiums in addition to medical liability reform.

“We’ve always said this is a multi-faceted problem,” Smith said. “We want to address all aspects of it.”