My Comment: This article appeared last November and came from a company well known to us in the insurance industy, A.M.Best Company. This is the company that rates insurance companies to help the consumer make intelligent choices. The topic will be of no interest to many of you. However, it deals with Medical Professional Liability (MPL) which is something Florida Wealth Advisors is very much involved with.

Right now S 197 is sitting on the sidelines, in committee. Whether we should be holding our collective breath to see if it gets implemented is unknown. But regardless of the outcome, there is a dramatic alternative to the coverage offered by the commercial insurance companies referenced that I explain here: The Six Minute Solution.

By Sean P. Carr, Washington Bureau Manager

A leading proponent of medical professional liability insurance reform is hoping a Republican counter to President Barack Obama’s jobs plan will offer a route to passing a national solution.

A bill to adopt MPL reforms with strict limits on noneconomic damages, punitive damages and contingency fees, S 197, is included in a legislative package being advanced by Senators John McCain, R-Ariz., Rand Paul, R-Ky., and Rob Portman, R-Ohio. The Jobs Through Growth Act offers another potential vehicle for gaining traction on tort changes, said Brian Atchinson, president and chief executive officer of the Physician Insurers Association of America.

“We’re pleased to see a step in the right direction,” he said. “Sometimes a good idea in a different environment can take flight.”

S 197 is similar to HR 5, a bill that includes a $250,000 cap on noneconomic damages, strict limits on punitive damages, a ban on subrogation by collateral sources, and sliding-scale fee schedule for attorney contingency fees. One significant difference is that S 197 allows a tiered noneconomic damages cap of $250,000 against a physician and up to two institutions, for a potential total cap of $750,000.

The House Energy and Commerce Committee sent HR 5 to the floor of the Republican-led chamber in May, where it still awaits a vote. In the Democrat-led Senate, S 197 remains before the Committee on Health, Education, Labor and Pensions. Its original sponsor was Sen. John Ensign, R-Nev., who resigned in May amid an ethics investigation.

Atchinson said “in a perfect world” he would prefer HR 5, which he previously conceded had “dim prospects” in the Senate (Best’s News Service, Sept. 30, 2011). The PIAA is pursuing all avenues to advance MPL reforms, he said: it has also asked the congressional “supercommittee” exploring deficit-reduction to take up reforms.

A May 2011Congressional Budget Office report projected $57 billion in savings over 10 years from HR 5, thanks to lower spending for Medicare, Medicaid, the Children’s Health Insurance Program, the Federal Employees Health Benefits program and other entities.

“There have to be better things to do than get it lost and tied up in our tort liability system,” Atchinson said.

The savings would amount to approximately 0.5% of national health spending, split between reduced spending and lower utilization of health services, according to the CBO. Opponents of proposed reforms include trial attorneys and consumer groups. The bipartisan National Conference of State Legislatures has also criticized HR 5, calling it an unnecessary infringement on the rights of states that have taken up their own reforms (Best’s News Service, Sept. 30, 2011).

The GOP jobs plan also includes previously introduced bills that would overturn the entire Affordable Care Act and reverse elements of the Dodd-Frank financial regulatory reform law. PIAA is endorsing the MPL aspect, but is otherwise staying neutral, Atchinson said.

“We’re not getting caught up in that larger debate,” he said.

The top five writers of medical professional liability insurance in the United States in 2010 were MLMIC group, with a 7.3% market share; Berkshire Hathaway Insurance Group, with 6.9%; Doctors Co.Insurance Group, with 6.6%; ProAssurance Group, with 5.4%; and CNA Insurance Cos., with 4.7%, according to BestLink.