Study: Illinois med-mal ruling to up insurers' costs 18%

Earlier this month the Illinois Supreme Court struck down a law limiting caps on jury awards in malpractice cases, which will lead to an 18 percent increase in costs for insurers, according to Milliman Inc.

Crain's Chicago Business explored this issue a few days ago.

The consulting firm said the recent removal of caps on malpractice awards would lead to higher costs per malpractice claim, on average. The number of people suing their doctors also is likely to rise, the firm said.

"The magnitude of the estimated increase is largely a reflection of the tort environment in Illinois," Chad Karls, a principal at Seattle-based Milliman, said in a statement. "In Illinois, claim severities have been among the highest in the country."

The state Supreme Court's Feb. 4 ruling struck down a 2005 law that capped jury awards for pain and suffering and other "non-economic" damages to $500,000 per case for physicians and $1 million for hospitals.

Crain's thinks that doctors may not pay more, since insurers may have made allowances for the court decision. But will it lead to doctors leaving Illinois, especially those working in field as neurosurgery and obstetrics? Also, are insurers thinking ten years ahead? Twenty?

Meanwhile, Democrats in Washington continue to balk at adding tort reform to their health care reform proposal.

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