N.J. Data Shows Med Mal Claim Payouts Falling

By Michael Ha

NU Online News Service, June 10, 4:06 p.m. EDT

According to the data, made public this week when U.S. District Judge William Bassler ordered the state to release the information, the malpractice payments?including confidential settlements, jury awards and other payouts?hit a high in 2001 with more than $214 million. But the payments tapered off at $199 million in 2002 and then dropped further to $162.5 million last year.

The information was only released after a freedom of information lawsuit was filed by The Record of Hackensack, N.J.

New Jersey's state Division of Consumer Affairs received the data from insurers who cover the state's doctors. The insurers that offer malpractice coverage are required to send a report to the state as well as one to a federal data bank whenever they pay to settle a malpractice claim or a jury verdict.

The data shows that since March 1999, a total of 2,333 out of some 22,000 physicians in New Jersey have made malpractice payments.

The amount of payments ranged from $1,700 to $3 million-plus judgments. Another finding from the data is that a relatively small percentage of doctors made a disproportionately large share of payments.

Among the 2,333 doctors who made malpractice payments since 1999, 363 made multiple payouts. Further, only 80 physicians were responsible for $178 million, or 20 percent of all malpractice payments made in the state during the past five years.

The data was made public days after the state enacted a bill to curb the rising malpractice premium rates.

New Jersey Gov. James McGreevey signed the legislation Monday. Its provisions set some restrictions on lawsuits and create a fund to subsidize the state health care industry's malpractice coverage costs.

Many New Jersey doctors and insurance companies have long been championing reforms, arguing that soaring malpractice payouts are behind the rising premium rates. But when asked about the newly released data and the declining payouts it shows, a physicians' group representative said there are many questions about the data's accuracy.

"We have serious concerns about the accuracy of that information," said John Shaffer, Medical Society of New Jersey spokesman. He noted that the malpractice data is included within a whole group of other information that the Division of Consumer Affairs keeps.

Mr. Shaffer said that when the consumer affairs division recently asked physicians to verify its information, "physicians who were going through this process were finding numerous errors?including social-security numbers, birth dates, educational background, the date of original licensure, specialties. And a lot of these doctors haven't had the opportunity to correct this information."

"We have doctors who have been in practice for 30 years, and it said their date of licensure is 2003," Mr. Shaffer said. "So given all that, do I place faith in the Division of Consumer Affairs to display the malpractice information correctly? No, I don't."

Furthermore, there could be a number of other factors that could have distorted the figures. "There could have been a couple of large verdicts that were appealed," Mr. Shaffer said. "There could have been putting-off of cases or settlements. There could be numerous reasons."

Richard Stokes, a representative for the Des Plaines, Ill.-based Property Casualty Insurers Association, also questioned the data, saying that data from a couple of years don't necessarily reveal a trend. "On top of that, the critical thing to recognize is that we still have insurers that are leaving the marketplace," he said.

Special Reports /

N.J. Data Shows Med Mal Claim Payouts Falling

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