Paul Ruiz – Claims Executive Gen Re, San Francisco Current Trends in Medical Malpractice Presentation to the Professional Liability Defense Federation September 29, 2016 Denver, CO Paul Ruiz – Claims Executive Gen Re, San Francisco

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Welcome to Denver [Presentation Title] | [Name of Presenter] | [Month, Year]

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Welcome to Trends in Medical Malpractice Industry undercurrents driving change Developing the next generation of trial attorney talent Nursing claim developments Dental claims developments Impact of the Affordable Care Act Additional miscellaneous items if time Frequency/Severity, Telemedicine, Cyber, Electronic Health Records, National Counsel. [Presentation Title] | [Name of Presenter] | [Month, Year]

Industry Undercurrents in Medical Malpractice The Market Trend of physicians becoming employees of hospitals and healthcare systems. Continuing acquisition of physician practices by healthcare systems. Demand Aging Baby Boomers Affordable Care Act: 20M newly covered patients Supply Increased need for primary care and physician extenders Increased need for MPL (but fewer independent physicians requiring MPL) [Presentation Title] | [Name of Presenter] | [Month, Year]

Increased hospital insurance purchasing leverage Impact to MPL Declining market share for carriers leading to more mergers and acquisitions Increased hospital insurance purchasing leverage Downward pressure on rates, decreased profitability Effects of industry consolidation Expense tightening Impact to defense firms What hasn’t changed…the need for quality claims and risk management [Presentation Title] | [Name of Presenter] | [Month, Year]

Developing Defense Attorneys What it was… Several associates providing assistance. The partner is the trial attorney High defense costs Associates occasionally authorized to try the case What it is… Frequency down, less cases for associates to gain experience Partners will keep the big cases, smaller cases usually get settled And yet… Importance of talented and capable trial attorneys. [Presentation Title] | [Name of Presenter] | [Month, Year]

Identifying those associates with trial capabilities Developing the Bench Identifying those associates with trial capabilities Allowing second chair Flexible billable hours Having an associate handle some of the witnesses Qualities of a capable defense attorney (from an insurance point of view) New claims talent – where are they coming from? [Presentation Title] | [Name of Presenter] | [Month, Year]

Nursing Claims Developments On the rise $90M over the past 5 years Foreign trained – more frequency, less severity 85% of nurses with 16+ years of experience had claims Largest indemnity payments were with those in the 3-5 year range Causes? (more responsibilities and demands = more claims, deep pockets) What can be done? Risk management strategies, training (5 “Rs”), documentation. [Presentation Title] | [Name of Presenter] | [Month, Year]

Dental Claim Developments – Increased Severity Old v New Paradigm Procedures at the upper limits of training. Why? Patients, Dentists, the Economy, Plaintiff Attorneys? Impact on dental carriers? Premiums Defense Costs What to do? Importance of Risk Management Claim handling – settlement v trial [Presentation Title] | [Name of Presenter] | [Month, Year]

Impact of the Affordable Care Act? Is the ACA going anywhere? Use of the ACA to mitigate future medical costs Example of future medical costs What are carriers and defense attorneys doing? What does the ACA not cover? Is the ACA a collateral source? How jurors may view the ACA Challenges to defense counsel [Presentation Title] | [Name of Presenter] | [Month, Year]

Additional Medical Malpractice Items Less frequency. Causes. Is it here to stay? More severity. Causes. Selectivity of cases, creative damage arguments (early and aggressive, negative discount rate, driving a wedge between insurer and insured) Telemedicine Cyber Electronic Medical Records Efficacy of using national counsel on select cases? [Presentation Title] | [Name of Presenter] | [Month, Year]

Primary Takeaways Significant market shifts with employed physicians, soft market, consolidation. Mutual benefit of developing younger attorneys. Hospitals and their carriers would do well to emphasize risk management and training of their nurses given the increased responsibilities. Carriers for dentists would also do well to focus on risk management efforts. Consider case studies for their insureds. “Lessons from losses.” ACA – Carriers and defense counsel should keep the provisions of the ACA in mind when addressing future medical costs. [Presentation Title] | [Name of Presenter] | [Month, Year]

Thank You Paul.Ruiz@genre.com 415-393-8436