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Courtesy of the Dallas Morning News
April 10, 2004
Associated Press
HOUSTON – A large medical malpractice insurer plans to bypass Texas
regulators to raise insurance rates for doctors.
GE Medical Protective will increase the cost of premiums 10 percent on June 1
by switching from a rate-regulated line of insurance to one that doesn't
require state approval.
The carrier, which insures about 7,000 of the state's 38,000 physicians, said
it factored the future cost of claims into its decision. It said it would have
had to drop coverage for some physicians if it had not made the switch, the
Houston Chronicle reported.
State officials had balked at the company's request to raise rates by 19
percent.
The move is a setback for Texas Insurance Commissioner Jose Montemayor and the
supporters of Proposition 12, which sought to curb the soaring malpractice
insurance costs by capping non-economic damages in medical liability cases.
Voters narrowly approved the measure in September.
The state insurance department estimated physicians could save between 8.5
percent and 11.5 percent on premiums if Proposition 12 passed. So far,
however, only one of five major insurers in Texas has agreed to lower its
rates.
Jay Thompson, outside counsel for GE Medical Protective, said not all
policyholders will face 10 percent premium increases. Doctors who have been
free of claims, for example, may see smaller increases.
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