NAIC Delays Vote On Med Mal Report

But after encountering vocal opposition, particularly from Birny Birnbaum, the executive director for the Center for Economic Justice in Austin, Texas, the committee decided to put off the vote for a couple of weeks to allow for an additional comment period on the report's final draft.

On June 25 the 13 committee members will hold a conference call to discuss any newly received additional commentaries and vote on the report. Sometime in July a conference call involving the entire NAIC will discuss the report.

The various drafts of the report, which have been around for at least six months for review, examine the troubled medical malpractice marketplace.

The study basically concludes that higher claims costs and increased litigation?not the need to make up lost investments?have led insurers to raise premium rates and some doctors to exit certain states or even quit their profession.

It also suggests that putting caps on non-economic damages in jury awards would be the most effective way to stabilize the marketplace.

When the report was previously discussed during the NAIC spring meeting in New York, several consumer advocates pummeled its findings.

The report was slammed for having hardly any substantial information on insurance topics such as loss control. Some also criticized the report as glossing over medical malpractice insurers' lackluster investment income, which a number of consumer advocates argued has been a major contributing factor in soaring premium rates.

Consumer advocates expressed more anger at the summer meeting, not only over the report's substance, but what they saw as an attempt by regulators to adopt the report without a full discussion.

"Consumer groups feel like they didn't have the opportunity to discuss it fully," said Mr. Birnbaum. "I don't understand why they are so intent on ramming this report through," said Mr. Birnbaum, who also complained that he still hasn't had any opportunity to discuss the final draft of the report with the regulators.

"In the latest version that I saw, pretty much everything we had suggested was rejected," Mr. Birnbaum said. "The executive summary failed on taking a more balanced view. The focus on caps on non-economic damages as the most effective tool to address rates?we pointed out there is no evidence to support that."

From the regulator's perspective, however, it's time to adopt the report, and there will be opportunities to make any needed changes in future updates.

Jose Montemayor, Texas insurance commissioner and chairman of the NAIC Property and Casualty Insurance Committee, explaining the decision to delay the vote, said during the committee session he had received a request from consumer advocates for a couple of weeks time for additional comments.

So, he said, "out of abundance of caution, we decided to give it to them." Commenting further on some critics who have been consistently slamming drafts of the report, the commissioner said, "I don't understand them. This is a good, scholarly report, and we will continue to update it in the future."

"We are at that window, where you have to publish what you have, and in the future update it again," the commissioner said.