As the insurance industry reels from a series of economic blows, many U.S. radiologists are getting stuck with sharply higher malpractice insurance premiums.
Radiologists in some states -- generally those with particularly active plaintiffs’ bars and those that haven’t adopted medical tort reform -- are hardest hit by a one-two punch of limited policy underwriting and "astronomical" price increases, according to Leonard Lucey, senior director and legal counsel for standards and accreditation at the American College of Radiology in Reston, VA.
"It hasn’t been this bad since the 1970s," said the ACR veteran, noting that insurance is a cyclical business tied to general economic trends. But the crisis decades ago had a silver lining that Lucey hopes to see again: laws to limit noneconomic damage awards against physicians, such as California’s Medical Injury Compensation Reform Act of 1975.
Indeed, California is looking pretty attractive these days to radiologists in neighboring Nevada. The state hasn’t implemented medical tort reform, and radiologists there are struggling to obtain insurance.
"We’re being offered 1/20th of the coverage for rates that are going up by 400%," said Dr. David Steinberg of Steinberg Diagnostic Medical Imaging centers, based in Las Vegas. "It’s pretty ugly -- ugly and depressing."
Radiologists are now being lumped together with obstetricians and surgeons as oft-sued specialists who should be avoided, according to insurance brokers. That’s because "failure to diagnose" -- particularly in cases of breast cancer -- has reportedly become the number-one issue in medical malpractice lawsuits. Last year the physician-owned ProMutual insurance company raised its malpractice rates for radiologists by 33%.
The number of claims against radiologists hasn’t necessarily increased, according to Lucey, but jury awards have gotten larger. So in states with very active plaintiffs' attorneys -- including Florida, Texas, West Virginia, New Jersey, Pennsylvania, and Ohio -- radiologists are reporting that they can’t get decent insurance coverage even if they’ve never had a claim.
Other radiologists, including Steinberg, have been told they could reduce their premiums by ceasing mammographic services. That insurers would suggest such a solution has serious implications for access to care, given that Steinberg’s centers perform about a third of the mammograms in Las Vegas. Already at least 300 pregnant women in the city have reportedly been denied prenatal and obstetric care as physicians pull out of the litigation-prone business of birthing.
The current insurance crisis was somewhat predictable, given the overall economic downturn. In particular, analysts say that insurance companies coasted through the 1990s on oversize stock-market returns that allowed them to go easy on premium increases in pursuit of market share and money for investments. But the stock market decline decimated revenues and reserves for all types of insurers, while the malpractice market has been afflicted by problems peculiar to the healthcare industry.
Many radiologists must find new insurance because their current carrier is in trouble or is leaving the business. In August 2001, the state of Pennsylvania took control of one of the nation’s top 10 medical malpractice underwriters, PHICO Insurance Company, because of the company’s inadequate reserves.
Then in November, the St. Paul Companies of St. Paul, MN, announced that it would cease renewing existing policies as of May 2002 and leave the malpractice insurance segment because healthcare’s ratio of losses to premiums was too high. St. Paul had been the nation’s second-largest medical malpractice carrier, insuring just under 10% of all physicians nationwide -- including 1,129 radiologists.
Meanwhile, raising prices for radiology services isn’t really an option given the reimbursement environment. "Any increase in our malpractice insurance pretty much comes directly out of our income," Steinberg said. "We shouldn’t be punished like this."
By Tracie L. ThompsonAuntMinnie.com contributing writer
April 23, 2002
Related Reading
Mammography reader volume directly linked to diagnostic accuracy, March 6, 2002
Consideration mitigates liability in mammography, February 28, 2002
Low reimbursement threatens breast imaging services, November 30, 2000
Misdiagnoses, lack of supervision, and poor communication land radiologists in court, May 17, 2000
Early diagnosis key to defending malpractice claims, March 1, 2000
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