What About the Medical Malpractice Insurance Crisis?
Florida Office of Insurance Regulation, and those who mine and study available data, in fact, there is no medical malpractice insurance crisis in Florida.
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What About
the Medical Malpractice Insurance Crisis?

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Supposedly, the caps imposed by FS 766.118 discussed in parts 1 and 2 of this series, were designed to address a medical malpractice insurance crisis in Florida. Based on a report submitted by a taskforce set up by Governor Jeb Bush, the legislature claimed (in 2003) that the increase in medical liability insurance premiums has resulted in quality doctors leaving Florida, refusing to perform high-risk procedures or retiring early, thereby limiting the availability of health care. However, the Florida Supreme Court conducted reviewed the available data and has determined that the number of doctors available in both urban and rural areas has increased (and was increasing at the time the legislature enacted the statutory caps).

In addition, while many think of runaway juries inappropriately entering inconceivably large verdicts, studies revealed that this is by far the exception and not the rule. In fact in evaluating Florida cases which resulted in payments over $1,000,000, over a 14 year period, one study found that only 7.5% involved a jury verdict. Over 10% were resolved without a legal action ever being filed (reads: sometimes the doctors know and acknowledge that they made huge mistakes and willingly paid fair value). In fact, jury trials, constitute a very small portion of medical malpractice payments and settlements post-verdict tend to be significantly smaller than the original jury award.

The Center for Justice and Democracy reported that the so-called crisis is nothing more than an underwriting cycle. Every time the insurance industry cries crisis dig deeper and you’ll find a severe drop in investment income for those insurers compounded by underpricing of insurance premiums. In other words: the insurance industry was simply not making money due to causes wholly unrelated to malpractice claims (stock market, poor business decisions) and sought a scapegoat for which to blame their lack of profits.

In 2003, the deputy director of the Florida Office of Insurance Regulation testified before the Senate Judiciary Committee that he had found no evidence to suggest that there had been a large increase in the number of frivolous lawsuits filed in Florida, nor was there any evidence of excessive jury verdicts in the prior three years.
Furthermore no study has linked caps on noneconomic damages to any corresponding reduction in medical malpractice premiums. One study (based on data fro 1991-2002) showed the median malpractice premiums in high-risk specialties rise 48.2% in states with damage caps and rise 35.9% in states without damage caps.

In addition, data shows, that the number of medical malpractice claims being filed is trending downwards.
Finally, according to the Florida Office of Insurance Regulation, the leading companies selling medical-malpractice insurance are thriving and enormously profitable. This is a trend seen in auto insurance companies as well. Auto insurance companies are also always screaming and complaining about all the frivolous lawsuits causing the increase in auto premiums, while making money hand-over-fist. I discussed this in a former Miami personal injury blog post I wrote over a year ago.

According to the Supreme Court of Florida, in Estate of Michelle E. McCall, et al. v. USA, No. SC11-1148 (March 13, 2014), the Florida Office of Insurance Regulation, and those who mine and study available data, in fact, there is no medical malpractice insurance crisis in Florida.