First in a Series

Area hospital officials and physicians say substantive tortreform is needed or the medical community here could deterioratelike it has in other areas of the state.

Because of the state’s growing reputation for “jackpot justice”and limited insurance coverage options, King’s Daughters MedicalCenter and physicians are facing soaring malpractice premiums andeven the possibility of no coverage.

“These guys are getting killed,” said Phillip Grady, KDMC’schief executive officer, in describing the physicians’predicament.

Grady said 14 physicians, certified registered nurseanesthetists or nurse practitioners are facing the possibility oflosing malpractice coverage between now and October. The number wasreduced from 15 when a nurse practitioner got coverage last Monday,the day before his policy was set to expire.

“Eventually, most of them will get coverage, but the question ishow much,” Grady said.

Dr. Spencer Mooney, an eye, ear, nose and throat specialist, isnot in danger of losing coverage and has had no claims in his 14years of practice. Yet, he said his insurance rates have more thandoubled in the last year. He attributed that to the state’s legalclimate.

“Malpractice is such a big part of your overhead that it makesit hard to be a sole practitioner,” Mooney said.

Grady said other physicians have indicated they are also facing100 percent premium increases. Some physicians have even claimedincreases of 200-300 percent or more.

“That’s on top of 50-60 percent increases the previous year,”Grady said. “Where does it end?”

At KDMC, Grady is not without his own share of insurance-relatedconcerns. He has been notified by the hospital’s carrier,Reciprocal of America, of a ‘capital call’ to bolster reserves dueto professional liability underwriting losses.

The provider is seeking $72 million from hospitals in the fivestates in which it writes insurance. Of that, $20.8 million, or 29percent, is sought from Mississippi hospitals and KDMC’s shareamounts to $404,584.

That amount is over and above any premium increase later thisyear. General liability coverage, the largest portion of thehospital’s premium, jumped from $116,800 in fiscal year 2001 to$221,000 in fiscal year 2002, Grady said.

Grady said the hospital must decide by June 30 whether to paythe capital call request. If it doesn’t, KDMC’s policy will not berenewed in November and Grady said his peers at other hospitals arebeing quoted “astronomical” premium amounts.

“When you’re a small community hospital, like we are, it becomesso difficult to pay out huge chunks of money,” said Grady, whoadded that KDMC’s claims history is small with no significantsettlements in his four years as CEO.

Grady didn’t blame insurance companies, many of whom have leftthe state, for the escalating premiums. He is looking to thelegislature for relief.

“What we’re trying to get is meaningful tort reform passed,”Grady said.

KDMC’s Board of Trustees has passed a resolution seeking aspecial session to address tort reform and the professionalliability insurance crisis. A special session does not appearlikely, but legislative leaders recently took what could be thefirst step toward a solution.

Lt. Gov. Amy Tuck and Speaker of the House Tim Ford last weekannounced the formation of a joint committee to study tortreform.

Tuck said the committee will have 10 members each from the Houseand Senate. She expected the committee to begin holding hearings inJune.

“We hope through these hearings to look at all facets anddetermine the magnitude of the problem,” Tuck said. “Everyone isapproaching this with an open mind.”

Tuck said the committee will study the problem and come up withsome recommended solutions.

“That’s the goal of our hearings: to see where we are and gofrom there,” Tuck said.

Grady and physicans agreed that if a mistake is made intreatment or a hospital procedure, then the patient should becompensated. However, they also say a cap is needed on awards fornon-economic damages.

“Doctors have never advocated not paying for any mistakes theymade when a patient was harmed. But it’s the punitive damages thatare killing everyone,” said Dr. Randy Tillman, a gastroentorologistat Lawrence County Hospital.

Tillman said Mississippi has earned its “jackpot justice”monicker because it has no cap on high punitive damage awards.

“There’s no reality check for the amount of damages awarded,”Tillman said.

Physicians believe they are at the forefront of a crisis thatwill spread to all sectors of the community. Regarding tortreform’s impact on the everyday citizen’s life, Dr. Steve Mills, anOB/GYN, likened it to campaign finance reform.

“Not many people are affected by it, at least for now,” Millssaid. “I think that’s fixing to change.”

Grady and physicians said further inaction on tort reform willhave far-reaching effects in hospitals’ ability to attract and keepdoctors.

“If the governor and the legislature don’t do something aboutit, Mississippi is going to lose a lot of access to health care,”Grady said.

Internist Dr. Ray Montalvo said Mississippi is already the mostunderserved state. He said that situation threatens to worsen ifsomething is not done to curb lawsuits and the rising insurancecosts that result from them.

“At some point, you have to question whether to stay and put upwith it in this state or leave the state,” Montalvo said. “I thinkthat’s a question every physician in the state is facing.”

Editor’s note: Monday’s story will take a look at how thestate’s legal climate is affecting several area physicians andtheir thoughts on the situation.