2. March 11, 2003 PLUS Medical Professional Liability Symposium D, Brent Mulgrew Executive Director OSMA

3. 2 OSMA Value 1. Advocating for physicians 2. Promoting a positive image 3. Practice services that save time and money Value & Loyalty Advocacy Practice Services Image Zero Cost of Membership

4. 3 ’Critical Condition’ Professional Liability Crisis ’Critical Condition’

5. 4 Source: www.ama-assn.org

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10. 9 What we’re seeing in Ohio “Soaring malpractice premiums stun many doctors”… USA Today “Family physician to give up obstetrics” … Health Headlines “Professional liability rates go up; doctors go away”… AMNews

11. 10 What we’re seeing in Ohio “Malpractice-insurance rates in Cleveland among highest in nation”… Cleveland Plain Dealer “Malpractice coverage hikes slam doctors” … Columbus Business First “No cure for rising costs...malpractice insurance skyrockets”… Akron Beacon Journal

12. 11 What we’re hearing in Ohio “My premium with Medical Assurance, even with my 15½% loss free discount, is going from $33,000 to $45,000 (+40%).”… Ob/Gyn, Cincinnati “Our practices have been billed 50-70% higher premiums this year for malpractice insurance.”… Multi-specialty IPA, southeast Ohio “Premiums are rising so fast that a change in careers or retirement become the only options.” … General Surgeon, Mt. Vernon

13. 12 What we’re hearing in Ohio “The rates for our group just doubled for no good reason. Our claims rate has not changed.” … Radiologist, Dayton “One of my partners was forced to retire due to the rise in malpractice rates!”… Urologist, Akron “My malpractice rates just doubled! I’d call that a crisis!”… Ob/Gyn, Maumee

14. 13 The Ohio physician’s experience Tighter Underwriting Increasing Jury Awards Decreasing Medicare Reimbursement IOM Patient Safety Report Seeing More Patients HIPAA St. Paul’s Exit Prompt Pay Down Coding 10-Year Soft PLI Market Managed Care MIIX Downgrade

15. 14 The impact…  Increased expenses  Time poverty  Revenue remains flat to declining  Reduced income  Decreased access to patient care  discontinuing some procedures (96%)  leaving for less litigious areas (15%)  quitting the practice all together (51%)

16. 15 Ohio’s PLI History 1974-75 PLI availability disappears OSMA’s response: Omnibus HB 682-Medical Multiple tort reform provisions-4yr S/L, Pretrial Arb, limitations on experts, voluntary arb. 250K cap most sections declared unconstitutional 1980 OSMA establishes physician owned PLI company Multiple entrants in marketplace by1980-Availability increasing, price increases slow to inflation 1982-86 Market tightens, prices spike OSMA’s response: Broad based Tort Reform include business coalitions

17. 16 History 1990--Held unconstitutional, but prices stable OSMA’s response: 1995 HB 350 Broad based Tort Reform--Unconstitutional 1999 Do you detect a pattern?? Without changing the Supreme Court-- legislation is useless 2001-02 Market deteriorates as prices spike and availability disappears

18. 17 Action taken…

19. 18 The OSMA’s response…  Communication with ODI  PLI Carriers’ Roundtable  Passed SB 281  Governor’s Task Force  Providing PLI Carriers’ Ratings  Providing Access to independent PLI agent

20. 19 Senate Bill 281  Limits noneconomic damage awards in the vast majority of cases to $350,000

21. 20 Senate Bill 281  Requires attorney contingency fees to be reviewed by a probate court if the fees exceed the noneconomic damage awards

22. 21 Senate Bill 281  Establishes a statute of repose

23. 22 Senate Bill 281  Protects physicians from the notice of a claim being used against him/her

24. 23 Senate Bill 281  Allows evidence of collateral source payments

25. 24 Senate Bill 281  Provides for periodic payment of future damages

26. 25 Senate Bill 281  Strengthens Ohio’s current arbitration law

27. 26 Related Tort Reform Legislation  Senate Bill 120 Removes joint and several liability In other words, in most cases, a physician who is named in a suit will only be held liable for the portion of the claim for which he or she may be responsible  Senate Bill 179 Provides a broader base of peer review protections Allows health-care entities outside the traditional hospital setting to establish peer review committees The activities are protected from discovery during litigation

28. 27 IMPACT  No reduction in rates or trend Increased numbers of failure to renew Selective underwriting of risks/specialties Increased demand for hospital provided ins. Credit history/psychological prescreens Creation of new nonstandard market options Risk retention groups, off shore or friendly state captives and OWAs. Ohio Hospital Assn. Creates new options for physicians through their institutions