Chicago neurosurgeons pay $4500/wk in med-mal premiums

by Walter Olson on July 11, 2011

Neurosurgeons in Cook and four other counties pay nearly $230,000 a year, obstetricians nearly $140,000, and general surgeons nearly $100,000. The legislature in Springfield had voted liability limits, but last year the Illinois Supreme Court, in a decision hailed by organized plaintiff’s lawyers but condemned as lawless by many others, struck down those limits. [Heather Perlberg, Medill]

{ 12 comments }

1 Bob Lipton 07.11.11 at 5:31 am

Quite clearly they must be lousy neurosurgeons.

Bob

2 Matt 07.11.11 at 6:42 am

I represent neurosurgeons and spine surgeons in disuputes with managed care (which they do not participate with). These surgeons regularly charge $100k+ for their complex surgeries and never less than $30k-$40k. While this may sound like a lot of money to average people, these guys can cover those premiums in a few afternoons.

3 wfjag 07.11.11 at 8:44 am

The teaching point is: Move your practice to Indiana.

4 VMS 07.11.11 at 11:14 am

NYC rates are slightly higher: http://www.mlmic.com/portal/pages/UW/ps.jsp

A neurosurgeon can cause lots of damage by his or her malpractice. Less so for an OBGYN and still less for a general surgeon. On the other hand a psychiatrist can do little damage so their premiums are about $7K per year.

Would you mandate that collision insurance on a Rolls be the same as a collision policy on a Corolla? Of course not! Would you mandate that the maximum anyone can seek from an insurance company for a collision damage claim is $10,000 no matter what car they drove? Of course not! Would you limit the legal liability of a drive of a car to $25,000 no matter how much damage he or she caused to lower premiums for everyone? Probably not.

So who is to blame. The insurance companies would rather pay out small fortunes for the defense of medical malpractice claims than pay the just claims of victims of medical malpractice. A physician has a disincentive to settle, unless the claim will go over the policy limits, because his name then gets reported to the national database. Plaintiff’s lawyers have little incentive to drag out or churn a case because they are almost always on contingency, whereas defense lawyers routinely do so because they are getting paid by the hour. Finally, payout caps and other limits on medmal awards will not likely lower premiums too much because much money spent is providing a physician with a defense split with amounts that actually go to the victims of the malpractice.

5 antiredistributionist 07.11.11 at 2:19 pm

VMS – Do you use a macro to post this stuff whenever med mal comes up?

6 Jerry Vandesic 07.11.11 at 3:23 pm

Unfortunately the number means nothing by itself. The key additional data point is how much monetary damage do Chicago neurosurgeons do every week via malpractice? Once you have both numbers you can argue over whether $4500 is too much or too little.

7 antiredistributionist 07.11.11 at 3:48 pm

A key data point is the extent to which premiums like this – and the medical malpractice litigation system they reflect – affect patients’ access to the best neurosurgical care.

8 Smart Dude 07.11.11 at 7:07 pm

Not to worry, ObamaCare will give us all top quality, low-cost neurosurgical care.

Along with unicorns.

9 B.RAD 07.11.11 at 10:35 pm

@Matt

Of the 30K to 100K …..

How much of that is global fee (OR , anesthesia, post op care, etc.) versus surgeon’s fee?

And, how much is the surgeon actually REIMBURSED?

Based on your calculations, and giving conservative estimates, (one case a day) neurosurgeons make $10-50M/year. I find that hard to swallow.

10 John Rohan 07.11.11 at 11:59 pm

From the article:

Trial lawyers have argued that the caps are unlawful. “If someone is going to be suffering their whole life, we think the idea of a one-size-fits-all arbitrary cap is just plain wrong,” said attorney Todd Smith. “It’s not constitutional.”

How is that not constitutional? In criminal law we have caps on every type of offense. For example, you can go to prison for a certain number of years for an assault, but no more than that. There is no “sky’s the limit” even if the victim of the assault will suffer their whole life. Why aren’t attorneys complaining about these “one-size-fits-all arbitrary caps” as well?

Of course, that question was rhetorical. Criminal prosecuting attorneys aren’t paid a contingency fee based on the number of years a defendant is sentenced to!

11 AMcA 07.13.11 at 11:53 am

@ Rohan: It’s Illinois. What do you expect? Prisoners in prisons, nobody’s getting rich off that, so no one’s going to encourage it.

But med-mal? There’s money to be made, so of course that’s to be encouraged.

12 Wayne 07.13.11 at 9:34 pm

Why is it fair that someone who is rendered a paraplegic, for example, by a negligent surgeon should be restricted to $250,000 for their pain and suffering? The result of caps is to permit the moderately injured victim to be fully compensated, while the grievously injured are undercompensated.

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