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Liability costs drive doctors from practice

Record insurance premiums force shutdowns of health facilities from West Virginia to Nevada.

By Steve FriessSpecial to The Christian Science Monitor / July 17, 2002


Shelby Wilbourn, a doctor, left his office here last Thursday afternoon, spent the evening packing his belongings, and then fled about as far as he could from Nevada – to a town in coastal Maine. For good.

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Dr. Wilbourn, like at least a dozen other local obstetricians, has been turning pregnant women away for months. The reason: punishingly high insurance rates. He was facing a medical-malpractice premium of $108,000, up from $33,000 last year. In Maine, he'll pay $9,800.

"If things don't work out in Maine, this is the last place I'd come back to," says Wilbourn, who has never been sued.

Wilbourn's abrupt departure is symbolic of a growing revolt by thousands of doctors across the country. Beset by record premiums, they are opting to quit, move, or scale back their practices. The result is a budding healthcare crisis from West Virginia to Nevada.

"It is a dire situation that is coming to a head now and needs to be resolved," says Carol Golin, editor of the Medical Liability Monitor, an insurance-industry watchdog newsletter.

True, doctors have been complaining about malpractice rates as long as they have about bad tee times. But the issue is quickly taking on national significance as the number of affected physicians – many of them obstetricians, surgeons, and emergency-room staff – grows by the day.

For example:

• More than 80 percent of the orthopedic surgeons in Pennsylvania said in a recent poll that they are considering leaving the state to find cheaper insurance.

• The maternity ward of tiny Bisbee, Ariz., which last year delivered about 275 babies, shut down completely earlier this year.

• No neurosurgeons in Wheeling, W.Va., are practicing anymore, forcing many people with traumatic injuries to receive treatment out of state.

• Fear of malpractice lawsuits has some insurance carriers urging their Mississippi doctors to stop giving free physicals to student athletes. Some free sessions have already been canceled.

Behind the crisis is a decision by the nation's second-largest underwriter to stop selling malpractice insurance and the proclivity of Americans to sue doctors.

"People think they can hit a jackpot in the liability lottery," says Donald Palmisano, president-elect of the American Medical Association (AMA). "All sorts of cases with no merit are being filed, and it costs money to defend against those cases."

12,000 doctors written off

Citing $1 billion in losses last year because of more multimillion-dollar judgments and a flagging economy, the St. Paul Cos. announced in December it would stop writing malpractice insurance policies for the 12,000 physicians it covered.

The decision sent doctors scurrying for other coverage, only to find that remaining companies demanded as much as a 300 percent hike in insurance premiums. For certain specialties that are more common targets of lawsuits – such as obstetrics – insurers wouldn't write policies at all.

Las Vegas emerged as the national focal point for the problem

on July 3, when the only trauma center in the area, which serves a 10,000-square-mile region, closed because several surgeons quit. The center reopened last weekend after enough doctors agreed that Clark County, which includes Las Vegas, would hire them, thus placing the doctors under a special $50,000 malpractice liability cap.