MED MAL COSTS HARM MD. ECONOMY:

While Gov. Robert Ehrlich, House Speaker Michael Busch and Senate President Thomas V. Mike Miller were struggling to come up with a legislative solution and ease the blow of a 33 percent increase in medical malpractice insurance premiums, the Maryland Hospital Association released an analysis that showed rising medical malpractice premiums are affecting not just the health care industry but the entire state economy. The report also lays the blame for the rise on a rapid escalation in jury awards and settlements in malpractice cases. Reduced spending by doctors and hospitals as a result of the rising premiums will cost the state 1,850 jobs this year, and 3,000 next year, the analysis found. Lost business sales, meanwhile, will total $171 million this year and $295 million next year, said economist Anirban Basu, the author of the report. The report said rising settlement and jury verdicts and a drop in the number of insurers is to blame. The problem of rising jury verdicts is highest in Baltimore and Prince George’s County, but exists statewide. The analysis found the average cost paid per medical malpractice claim rose from $234,000 in 2000 to $386,000 in 2003. While runaway jury verdicts are often blamed, a review by The (Baltimore) Sun found the state’s largest medical malpractice insurer, the Medical Mutual Liability Insurance Society of Maryland, settles 90 percent of claims before they reach a jury. The company has also added hundreds of doctors to its rolls in recent years without verifying whether the doctors have histories of repeated malpractice claims. Once an insurer accepts a doctor, state regulations make it tough for the insurer to drop bad doctors, the newspaper reported. The hospital group’s analysis showed the number of claims, however, has not risen in recent years, only the malpractice payouts.