be struck down by the courts or be either upheld explicitly or implicitly accepted by the bar. So far they’ve been useful. About the only place I can think of that’s still up in the air is Georgia where we’re waiting for a decision on their damage cap. Nothing very likely at the federal level.
President Obama in September proposed that grants from the federal government be given to states and to organizations to experiment with different kinds of tort reform measures. Most of those sounded like proposals that have been heard before. But it was interesting that there will be grants to set up special medical malpractice courts. That might be a good idea. One of my partners tells me that works out very well in D.C. and it’s possible that these might contribute to an environment in which physicians feel they are treated more fairly if cases are tried before courts that actually have some expertise. They can do a better job of policing the quality of expert evidence and other things that a judge with knowledge in the area can do that an average judge sometimes does a very poor job of.
DOWNS: I’d like to thank A.M. Best for having the Medical Society and myself on the call. Currently physicians are very happy, at least in our state, with the availability of coverage, which wasn’t the case several years ago. We are consistently looking for ways to make the environment to practice medicine more friendly and allow physicians to treat patients without massive concern for who’s around the next corner. Thanks for having us on and I appreciate the opportunity.
STARNES: I think all of the challenges that we’ve discussed today emphasize the importance that the purchaser of medical professional liability coverage and those that facilitate that purchase must be more attentive and vigilant than ever, to make sure that the company with whom they’re placing their coverage has a very strong financial statement, a very strong commitment to the physicians it insures and a willingness to look at the realities of the world and not what we hope the world may be like some day. Very important.
ZIMMERMANN: The full impact and benefits of tort reform in Texas are being realized. Access to care has greatly improved. There’s been a significant growth in the number of physicians that have moved into Texas. Premiums paid by physicians have come down due to an improved claim environment. There has been increase in competition. In general, just improved reasons to practice medicine in the state and as a result, an increase in practice scope and the number of physicians in high-risk specialties.
KARLS: If we take a step back and think of all the really, very significant changes that have occurred in the broader economy of late, things that we probably wouldn’t have expected to happen a few years ago that really did take place, if we couple that with still the rather unexpected and unexplained falloff in claim frequency that we saw in this marketplace, I think we need to be cognizant that as quickly as the claim frequency fell for reasons that are still being debated , it can rise or other cost dynamics could push the costs up in the other directly just as quickly.
Thus, probably more so than ever, it is important for industry to maintain very strong balance sheets. Fortunately, to a large degree, that is the case due to the last few years of very strong operating results for the industry
DR. ANDERSON: In the last hard market we saw, as expected, a number of new entrants and rapidly formed RRGs entering the market place. We would normally have predicted by where we are now, five or six years out, that a number of them would have hit the wall. You referenced that in some ways with the exhibits in the BestWeek article showing the number of medical malpractice vehicles that have left the arena during the previous hard markets.
We haven’t seen that yet and I think the reason is primarily because of frequency. That unexpected drop in frequency allowed poorly capitalized companies with either low rates or low assessments to survive longer than might be expected. The frequency bonus is wonderful but it’s over. As the market softens I would be very cautious as both a producer and a risk manager in continuing to rely on these poorly capitalized and poorly rated vehicles.
McDONALD: Thank you all, our panelists. By the way, if anybody would like to discuss a rating opportunity, our contact in this sector is Tina Bukow-Truman. She’s at the A.M. Best number, which is (908) 439-2200 ext. 5825 and her email is tina.bukow@ambest.com.
So thank you, I’m Lee McDonald with the A.M. Best Company. Thanks for joining us. Page 1  |  Page 2  |  Page 3  |  Page 4  |  Page 5  |  Page 6  |  Page 7  |  Page 8  |  Page 9