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Everyone who spoke to a House panel last week agreed medical insurance premiums have shot sky high, but they disagreed about what to do about it. Some called tort reform vital; others called it pointless. Tort reform advocates got the job half done in the 2003 legislative session, getting a bill through the Senate but seeing it stall in the House. Tuesday’s meeting set the tone for what likely will be a contentious debate when the General Assembly convenes in January. House Speaker Terry L. Coleman appointed an advisory group on “civil justice reform” to consider SB 133, a bill spearheaded by Senate Majority Leader Thomas Price, a physician. The House Judiciary Committee is charged with vetting the bill. The speaker placed Judiciary Committee Chairman Thomas C. Bordeaux Jr., D-Savannah, and Larry “Butch” Parrish, D-Swainsboro, a pharmacist, in charge of the advisory panel. The two said they don’t always see eye-to-eye on the issue. “We’ll hear parts of the elephant that don’t make any sense,” said Bordeaux, referring to the story of five blind men describing different parts of an elephant. Bordeaux’s reference certainly described the debate that followed. Business and insurance representatives and doctors said runaway malpractice verdicts in Georgia are driving doctors and hospitals out of business, and the state desperately needs a law that caps noneconomic damages and limits rewards for lawyers who bring such suits. But a University of Georgia torts professor produced a report that says overly generous juries and huge settlements are myths. A plaintiffs’ lawyer said the 19 states that have enacted tort reform saw no drop in insurance premiums, and a state insurance department official said she didn’t know if tort reform would “help or hurt.” IS GEORGIA ‘FACING A CRISIS’? Rome radiologist J. Dan Hanks Jr., also a director of the Medical Association of Georgia, was first to speak. He said Georgia is “facing a crisis: dramatic increases in jury awards, increasing malpractice insurance, doctors’ leaving the state or retiring and not providing [certain kinds of] care.” One problem he cited involves women’s health. Mammograms are increasingly controversial procedures, he said, because they are only 85 percent accurate. The high rate of inaccuracy, Hanks said, leaves doctors vulnerable to med-mal claims if patients are misdiagnosed. Hospitals and physicians pass on the costs of liability to consumers, he added. Hanks called for capping noneconomic damages at $250,000, limiting emergency rooms’ liability, tightening requirements for expert witnesses and ending joint and several liability, most of which were called for in SB 133. In his remarks, Ken B. Beverly of Thomasville, CEO of Archbold Medical Center and chairman of the Georgia Hospital Association, said he used to send teams to fairs and festivals to administer $25 mammograms. Not anymore. He predicted mammograms could result in the next big wave of litigation, rivaling the scope of tobacco and asbestos suits. For doctors who see 30 to 40 patients a day, Beverly added, each one is a potential suit. “Doctors don’t see it that way,” he said, but “the system is disintegrating before our eyes. … I don’t worry about losing my entire life savings when I go to work, but the 120 doctors on our medical staff do.” Beverly called for “common sense reform to level the playing field” in the courtrooms. Robert L. Brown Jr., an architect and founder of RL Brown & Associates, is the current chair of the Georgia Chamber of Commerce. He said, “The number one issue that relates to economic development is reasonable access to health care. “It comes down to competitiveness with other states that have passed tort reform. We can’t lose our edge,” he warned. He called for pre-treatment arbitration agreements and limiting the amount lawyers can receive from verdicts. “The injured party should receive more of the final award,” Brown said. STOCK MARKET AFFECTS PREMIUMS Assistant Chief Deputy Commissioner of Insurance Amy Atkinson called skyrocketing premiums the result of a “perfect storm” in the insurance industry. Rates were written to break even or operate at a slight loss because the companies would earn money on stock market investments, she said of the market in the 1990s. But after Sept. 11, 2001, insurance companies found it was difficult to earn adequate returns on their portfolios. The St. Paul Companies, one of the nation’s largest medical malpractice insurance carriers, withdrew from the market in 2000. The med-mal business had become unprofitable for St. Paul, Atkinson said, but she attributed that to business decisions. Thirty percent of Georgia doctors have been forced to seek new coverage since 2000, she added. She also said that there are fewer insurance carriers in Georgia now than in the late 1990s, which means there’s less competition. She added, “No one knows if [legislation] will help or hurt.” Georgia State University professor Martin F. Grace of the Department of Risk Management & Insurance said, “This is not a typical insurance cycle story” because it was “caused by external shocks.” He also discussed market effects on premiums and claims. He said, “Someone has to pay some returns to shareholders” of insurance companies. In 2001 when the stock market lost billions of dollars in value, he said, property and casualty and medical malpractice insurance companies “lost a lot of money.” He said that while Georgia may not have huge verdicts, the industry’s capital is national, which means nationwide trends in large verdicts affect local pricing. He added that while some academic research has shown that “tort reform affects losses but not premiums,” most of it wasn’t peer-reviewed. JUST THE FACTS UGA torts professor Thomas A. Eaton presented a $150,000 study of Georgia tort litigation from 1994-97. The Georgia Civil Justice Foundation funded the study. Eaton, along with UGA political science professor Susette M. Talarico, looked at 25,561 tort cases in state and superior courts. They found an almost flat rate of filings over the four-year period. Of all tort cases, 6.5 percent were personal injury cases, the bulk of them auto accident cases. Adjusted for population growth, Eaton found filings decreased slightly over the four years. “[There's] no indication of any type of litigation explosion in the late 1990s,” he said. Eaton also said there was no evidence that Fulton County, Ga., is the so-called “plaintiffs’ nirvana” or that Georgia has runaway juries. Of the few cases that made it to trial, plaintiffs and defendants had an almost equal chance of a favorable verdict in front of juries, though judges tended to favor plaintiffs slightly, he found. Rounding out the panelists was Foy R. Devine, the son and grandson of doctors, and a plaintiffs lawyer with Doffermyre, Shields, Canfield, Knowles & Devine. Devine said the 200-year-old American civil justice system has made this the safest industrialized country on earth, “in large measure due to [our] tort system,” which “encourages everybody to be more careful as they go about their daily lives.” He echoed Eaton’s claims that venue shopping, runaway juries and huge settlements haven’t been a problem in Georgia. “How much more level does [the playing field] need to be?” he asked, referring to the lack of evidence that Georgia juries favor plaintiffs. Devine also cited studies that showed caps on noneconomic damages in 19 states didn’t lower insurance premiums. Med-mal cases, in which patients must prove negligence, are very difficult to win, he added, and lawyers seriously weigh whether to take them. “You know you have an 85 percent chance of losing” if you go in front of jury, he said, referring to other studies.

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