Governor works on doctors’ insurance extension

By Emily Richmond (contact)

Tuesday, April 2, 2002 | 10:50 a.m.

Gov. Kenny Guinn said Monday he has reached a verbal agreement with the largest insurer of Nevada's physicians to extend coverage through the end of the month, allowing doctors to practice until the state's medical malpractice insurance plan kicks in April 15.

Guinn, in an interview airing today on "Face to Face with Jon Ralston" on Las Vegas ONE, Cox cable channels 1 and 39, said the details were being hammered out with St. Paul Cos., a Minnesota firm that covered about 40 percent of Nevada's physicians.

Guinn said the insurance company is also considering his request to accept payments from Nevada doctors on the $105,000 bill for "tail coverage" -- a one-time fee physicians must pay their old insurance company to cover acts that occurred before new coverage begins.

Facing a lump-sum tail payment was a significant hurdle for many physicians, Larry Matheis, executive director of the Nevada State Medical Association, said. Most physicians stay with one insurance company for their entire career simply to avoid facing a huge tail payment, Matheis said.

"If the governor has won us some leeway on the tail coverage, it would relieve a lot of the pressure of this crisis," Matheis said.

The state insurance coverage is a short-term solution to a problem that will likely need legislative action and tort reform to solve, Guinn said.

Facing losses of nearly $1 billion, St. Paul Cos. announced in December it was pulling out of the malpractice insurance business worldwide.

Hundreds of doctors statewide working in high-risk specialties such as obstetrics and surgery say they have been unable to find affordable insurance to take over when their contracts with St. Paul expire. Other companies have pulled out of Nevada as well, citing the high cost of settling malpractice claims in a state with no cap on jury awards.

A spokesman for St. Paul confirmed Monday that negotiations were continuing with both Guinn and State Insurance Commissioner Alice Molasky-Arman but declined to specify what offers were on the table.

Obstetrician Dr. Jeffrey Wrightson, along with hundreds of other Nevada physicians, was unable to find medical malpractice insurance coverage to continue when his existing plan expired Monday. Emergency state-backed coverage arranged by Guinn does not take effect until April 15, which left Wrightson uninsured for two weeks. On Friday Wrightson had just two quotes, for $95,000 a year and $166,000 a year, compared with his current $12,000.

"There was no way I could manage that kind of astronomical hike in cost," he said.

As the clocked ticked, Wrightson paced his Las Vegas office, wondering how he would tell his patients that he would be unable to deliver their babies. At 4:15 p.m. an insurance provider offered coverage starting at $20,000 and peaking at $60,000 in five years.

Wrightson said he was surprised.

"I know (GE Medical Protective) and all the other smaller carriers have been swamped," Wrightson said. "These companies weren't prepared to take on all us doctors."