Deal offers no guarantees on reduced rates for doctors

Tuesday, July 30, 2002 | 11:13 a.m.

CARSON CITY -- While there appears to be general agreement on a bill to solve the medical malpractice crisis in Clark County, there is no guarantee that insurance rates for doctors in Las Vegas will be reduced.

Absent from the bill, which was discussed Monday, is any reform of the insurance industry, which is being blamed for touching off the troubles. And there isn't anything in the measure that would require insurance companies to lower doctors' premiums, which have skyrocketed in the past six months.

Assembly Speaker Richard Perkins, D-Henderson, and Majority Leader Barbara Buckley, D-Las Vegas, both said Monday that insurance companies will save millions of dollars as a result of the agreement reached at the special session of the Legislature.

The lawmakers said they wanted to suggest changes in the law that governs insurance companies during this special session, but that it is outside the call of Gov. Kenny Guinn, who sets the agenda. Perkins and Buckley said they will bring an insurance reform package to the 2003 Legislature.

Buckley also said the Democrats intend to monitor the insurance companies after the special session to see if they lower their rates.

Some estimates from insurance companies say a $350,000 cap on non-economic damages would save doctors 25 percent in premiums in a three to eight-year period. Jim Wadhams, a Las Vegas attorney representing the insurance industry, said he would work with legislators on potential changes in the law in 2003.

The bill in the special session, Wadhams said, will help stabilize the medical malpractice insurance market in Nevada.

Buckley said that after the session, Democrats will ask state Insurance Commissioner Alice Molasky-Arman to force insurance companies to eliminate the surcharge on obstetricians if they deliver more than 125 babies.

Buckley said the Assembly Democrats had planned to include a requirement that insurance companies reduce rates after a medical malpractice bill is passed in the special session.

But that wasn't included in the proclamation issued by Guinn in convening the session -- and the governor controls the agenda.

Guinn Chief of Staff Marybel Batjer said the administration reviewed a lot of ideas on how to change the laws governing the insurance companies.

"We couldn't discern whether the impact would be helpful or hurtful," Batjer said.

There is only a small number of medical malpractice companies operating in Nevada, she said. The governor wants to attract more companies to open up the market and he was fearful that additional regulation might have an adverse impact, Batjer said. St. Paul Cos., which was the largest writer of medical malpractice insurance in Nevada, pulled out of the market, and other companies increased their rates. St. Paul said it was leaving Nevada because it lost money on its policies in the state.

Critics said St. Paul lost money due to a poor investment strategy. Buckley said part of the reform package in 2003 will stop insurance companies from raising rates if they lose money through faulty investments.

Buckley was skeptical there will be any major relief for doctors from escalating premiums.

"I don't know of any bill passed by any Legislature that will reduce rates," she said.

Evidence shows that rates are about equal in states that have caps on non-economic damages and those that do not, Buckley said.

Senate Minority Leader Dina Titus, D-Las Vegas, suggested a 20 percent rollback of insurance rates. But Senate Majority Leader Bill Raggio, R-Reno, said that was beyond what Guinn proposed in setting the agenda.