Doctors now learning what average homeowners know well

By Carlos Guerra, San Antonio Express-News

As the off-day election in September on Proposition 12 drew near, many Texas doctors personally asked their patients to vote for it.

Some may now be asking what Texas homeowners have asked for years: Where are the promised lower insurance premiums?

The multimillion-dollar ad blitz for capping medical malpractice awards didn’t mince words: It charged that trial lawyers’ frivolous lawsuits against doctors were driving insurance premiums so high, doctors were leaving Texas or abandoning their profession. Prop 12’s passage, the ads said, would lower doctors’ premiums.

The doctor-owned Texas Mutual Liability Trust promised a 12 percent rate decrease if it passed, and the Texas Department of Insurance said the overall rate reduction would be as much as 11.5 percent. Lt. Gov. David Dewhurst said rates would drop 16 percent.

After Prop 12 passed narrowly, TMLT said its rates would drop 12 percent in January.

But Wednesday, the Houston Chronicle reported that “two of the five major carriers are planning to increase rates for physicians.”

GE Medical Protective wants to raise rates 19 percent in June and Joint Underwriting Association asked for 35 percent higher rates beginning in January.

Texas Insurance Commissioner José Montemayor rejected the 35 percent increase — one day after the Chronicle’s story broke.

“I’m not surprised they are going to charge more,” said Dan Lambe of Texas Watch, one of the consumer groups that opposed Proposition 12. “I’m just surprised it’s happening so quickly.”

The Texas Department of Insurance lists 58 medical malpractice carriers. But about one-third of the policies are carried by TMLT and another one-third by the four other big carriers.

TDI’s spokesman, Jim Hurley, said that Joint Underwriting’s increase request was denied because it was contrary to the sentiments expressed by Prop 12’s passage.

GE Medical Protective’s increase request is still under study, he said, adding that all future requests will be studied carefully.

“Every rate is going to be a just and actuarially provable rate,” he said. “We want the effects of Proposition 12 factored into any rates.”

Texas allows six types of carriers to write medical malpractice policies but not all are regulated.

Asked how many doctors’ premiums the state could actually control, Hurley explained: “We regulate the licensed insurers, but TMLT, risk-purchasing groups, risk-retention groups, surplus-line groups, those are not regulated.”

Asked how many physicians’ insurance bills TDI can keep in line with the spirit of Proposition 12, Hurley said: “About one-third.”

“These are the same broken promises we’ve seen from insurance companies for decades,” Lambe said. “For 15 years, we have seen restrictions placed on the legal rights of families through so-called tort reforms, and there were always promises of lower costs of products and insurance.

“But every change has only resulted in more difficulty for policyholders to get claims paid.”

Texas Watch, he said, also is investigating doctors’ complaints of lower premiums being offered for lesser coverage or higher deductibles, insurance company proposals familiar to many homeowners.

“Let’s face it,” Lambe concluded, “we have been restricting the rights of consumers because that is a lot easier to do that than it is to take on the multimillion-dollar insurance lobby and hold the insurance companies accountable.”