MSDC's 2005 Letter to Mayor Williams

March 16, 2005

Hon. Anthony A. Williams

District of Columbia
1350 Pennsylvania Avenue, NW
Washington, DC 20004

Dear Mayor Williams:

On behalf of the more than 1800 members of the Medical Society of the District of Columbia, I applaud you for your past leadership on the issue of medical liability reform.  Once again, our membership looks to you for guidance and assistance in bringing sensible medical liability reform legislation to the District of Columbia.

Much has changed since you introduced your bill last June.  But unfortunately, no relief has come to the doctors who practice medicine in the District of Columbia.  Premium rates continue to increase exponentially, and more of our members are facing difficult decisions that affect their careers, their practices, and most importantly, their patients.

Every doctor across this city wants injured patients and the families who have lost loved ones as the result of medical negligence or medical error in the health care system to be fairly compensated for their economic losses, including lost wages and uncovered medical payments. But we must strike a balance so that pain and suffering judgments do not bankrupt the care delivery system.

A phone survey of DC obstetricians just completed by MSDC sheds new light on the growing crisis in our city.  More than 40% of the obstetrician/gynecologists in Washington have stopped delivering babies.  Many other physicians have reduced their hours or eliminated other vital health services to reduce their medical liability burden.

Sadly, there has been no change in the high rates of liability insurance paid by doctors who continue to practice in the District.  We have the highest average jury awards for medical liability claims in the nation.  So it comes as no surprise that we have some of the highest medical liability premiums in the nation.    

The examples shown on the attached charts make the case:

For obstetrician/gynecologists practicing in the District of Columbia, average premiums in 2000 were $75,145 per year.  Now they are $139,128 annually.  If nothing is done to help this situation, these rates will exceed $235,000 just five years from now. 

For general surgeons in DC, their rates are now approaching $70,000 per year, nearly twice what they were five years ago.   By the end of the decade, insurance rates for internal medicine will have increased by more than four times what they were in 2000.

And let’s not neglect the other end of this dynamic.  For far too long, DC has suffered with the highest average patient payments of any state in the nation.  In a study prepared for the NORCAL Mutual Insurance Company in 2002, DC ranked number one in the nation when compared to the other 50 states with an average payment figure of $584,338.  By comparison, Maryland came in at less than half that amount ($282,403) and a dozen states showed average annual payment figures that were well under $200,000.

Part of the reason that we see such disparities in these figures is due to the fact that some states have taken steps to remedy the medical liability insurance crisis while others have not.  On the bright end of the spectrum is California, which has some of the country’s lowest medical liability premium rates and is 50th in the nation for average patient payments.  California’s medical liability reform law (known as MICRA) set the standard for the rest of the nation.  Rates have stabilized over the 30-year history of the law keeping access open to patients while at the same time allowing California to continue to lead the nation in health care technology and innovation.

And we are seeing other signs of hope.  States across the country are moving forward with medical liability reform initiatives.  Many states have enacted legislation in the past 18 months and many others are moving forward with legislation designed to restore financial stability to the current out-of-control medical liability insurance premium market.  

Oklahoma, Wyoming, Idaho, Arizona, Florida, West Virginia, Mississippi, Ohio, and Texas have passed medical liability reform legislation. As you know, Maryland is fully engaged in the issue - as the Legislature and Governor Ehrlich hammer out the final details of their bill - and the Virginia Legislature is debating the issue in its current session.

New Jersey State Health Commissioner Fred Jacobs said this month that high malpractice insurance premiums are “a public health issue” and that he is considering support for legislation that would cap non-economic damages at $250,000.  Both houses of the South Carolina State Legislature passed bills this year imposing caps on non-economic damages in malpractice lawsuits.  The State Legislature in Wyoming passed a bill just this month that would require professional liability claims to be vetted through a review panel for merit prior to going to court.

And in the Congress, we’re seeing the strongest effort yet to make medical liability reform a national priority.  But doctors and consumers – our patients – in DC cannot wait for Congress to act.

All over the country, the issue of medical insurance reform is being recognized as a serious crisis that adversely affects both access to health care and the quality of health care.  The time has come.  We need the elected leadership of our city to recognize the crisis that we must live with every day.  And we need you to recognize that a medical practice - first and foremost - is a small business, facing the same realities that other businesses face.  If our operating costs exceed our revenue potential, we cannot survive. 

Doctors throughout the District of Columbia cite medical liability insurance costs as their single greatest concern.  Yet some outside of the medical community continue to deny that we have a crisis. 

Ironically, elected officials in the State of Minnesota - a state with some of the lowest professional liability premiums in the nation, - have shown the leadership we so desperately need to see from the Council of the District of Columbia.  Just last week, the Minnesota House Health Policy and Finance Committee voted to approve a medical liability reform bill that caps non-economic damages and punitive damages at $250,000 and caps plaintiff attorney fees in obstetric and emergency room cases. State Representative Brad Finstad said, “Reforming our professional liability and malpractice system now is crucial.  We need to act now before it becomes a crisis.”

So as we begin this year’s campaign for medical liability reform, we frame the debate by asking the question, “What is the cost of doing nothing?”

Doctors in our city are feeling a financial squeeze that comes from higher energy costs, rising rents, flat or declining reimbursement rates, and spiraling professional liability insurance rates.  The cost of doing nothing is the loss of talented doctors who will stop practicing obstetrics, surgery, and other specialties or relocate their practices altogether. 

The cost of doing nothing is the loss of the medical assistants, account specialists, receptionists, and other jobs that will walk away with each doctor who leaves the District, bringing an increase in unemployment and losses in tax and other revenues to the city.

When we look at the world-class medical schools and teaching hospitals based here in DC - Georgetown, Howard, and George Washington, Washington Hospital Center, Children’s National Medical Center, and Providence - we need to recognize that very few of the graduates from these training programs are planning to launch their careers here the District.  The cost of doing nothing is that we will continue to train doctors here to meet the demands of the nation while we struggle to provide specialty care and reasonable access to healthcare for our own residents.

And while the District government has shown great innovation in developing and implementing programs to attract and maintain small businesses, there is nothing being done to help retain the hundreds of small business medical practices already based in DC.   The cost of doing nothing is a loss of jobs, a loss of revenue, a loss of access to quality healthcare and a loss of hope.

For so many reasons, it is easy to see that the cost of doing nothing comes at far too high a price to the residents of the District of Columbia.  Now is the time to make a difference for the future well-being of our city.  Enact medical liability reform now.

Sincerely,

Victor G. Freeman, MD, MPP

President