Maryland Medical Malpractice Insurance - A Brief Overview
In recent years, Maryland physicians have engaged in a difficult battle to reign
in skyrocketing medical liability premiums. It took an impending access-to-care
crisis to grab public support and make noticeable strides toward a more stable malpractice
environment.
Maryland’s battle to enact meaningful tort reform and stabilize medical liability
insurance rates began after the state’s largest insurer, Medical Mutual Liability
Company, was granted a 33-percent rate increase beginning Jan. 1, 2005. In response,
physicians and healthcare professionals sounded a statewide alarm, with two surgical
groups—one in Hagerstown; the other in Frederick—threatening to close their practices.
For these two communities of more than 50,000 citizens, the two surgical groups
provided 65- to 100 percent of the surgical care. Both practices said that they
would stop seeing patients on Jan. 1, 2005, if significant reforms were not enacted,
and each took their threats to the local and statewide media. Immediately, Maryland
newspapers and television began to examine the possibility of a looming access-to-care
crisis.
In response to community concern, Gov. Robert Ehrlich called for a Special Session
of the General Assembly to address essential reforms and legislate a bill to avoid
the impending surgical strike. Changing the requirements for expert testimony and
“Good Samaritan” protection to protect those who provide emergency care were strongly
advocated by the pro-tort-reformers.
Maryland Patients’ Access
to Quality Health Care Act of 2004 (HB2) — the bill that emerged from the
special session—contained few of the reforms advocated. The bill was widely considered
a “gift to trial lawyers” by editorials in the press, but it did tighten requirements
for expert witnesses along the lines proposed by the American College of Surgeons
as well as a measure for an enhanced certificate of merit. “Good Samaritan” provisions
did not survive, but a $650,000 cap on non-economic damages was established. To
stabilize malpractice premiums, a fund of $40 million dollars was to be created
by eliminating the exemption of a 2 percent premium tax the HMOs previously enjoyed
in Maryland.
Unhappy with HB2, Gov. Ehrlich vetoed the bill on Jan. 10, 2005, because he opposed
the elimination of the HMO tax credit and , in his opinion, most of the reform measures
had been watered down or eliminated. The following day, the governor’s veto was
overturned by the General Assembly, and Maryland Patients’ Access to Quality Health
Care Act became law.
Despite its watered-down content, the signing into law of HB2 was supported by the
Maryland Medical Society because it allowed
many physicians to continue practicing in Maryland, assuming the rate stabilization
fund was effective.
Of further importance to Maryland’s tort reform movement was that it had discovered
a voice and attracted the attention of the general public. The correlation between
out-of-control medical liability insurance rate increases and access to care had
been established.
And while the effectiveness of Maryland’s tort reform on medical liability premiums
will ultimately be judged years down the road, they do show promise. One of the
major Maryland malpractice companies flattened its rates in 2006 and decreased its
premiums across the state by 8 percent in 2007 and again in 2008.
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