Doctors, lawyers discuss medical crisis

Erin Neff

Friday, March 22, 2002 | 11:15 a.m.

The "tail" wagged the dog of the medical malpractice crisis Thursday during the first meeting of a legislative panel studying skyrocketing costs that are forcing doctors to leave the state.

During a daylong hearing with testimony from both doctors and trial lawyers, lawmakers expressed their first concerns with Gov. Kenny Guinn's establishment of a short-term insurance underwriting association to assist doctors who cannot find coverage.

The Nevada Essential Insurance Association was created March 15 with $250,000 in state emergency funds to help underwrite insurance coverage. The plan does not include tail coverage -- a one-time fee a doctor pays when signing up with a new insurance company to cover any claims while insured with the old company. Many doctors report being stuck with $100,000 or higher tail insurance bills even if they find affordable insurance rates.

Assembly Majority Leader Barbara Buckley, D-Las Vegas and chairwoman of the legislative subcommittee studying the crisis, asked why the governor's plan did not cover the tail.

Bruce Heffner of the state Insurance Commission said starting the plan with a tail would complicate matters and make it more difficult to obtain "re-insurance coverage" for the underwriting association.

That comment worried Assembly Minority Leader Lynn Hettrick, R-Gardnerville, who said the tail could create state liability when the stopgap underwriting association is closed down in about 12 to 18 months.

"This fund is going to create its own tail," Hettrick said. "I'm concerned that we're not creating a monster that bites us three years from now."

Assemblyman Bernie Anderson, D-Sparks, asked whether the governor's plan had sufficient money to cover every doctor who needs insurance because his or her premium is expiring and additional coverage is too expensive or unavailable.

Marybel Batjer, Guinn's chief of staff, said the underwriting association will have a board of directors to decide the criteria a doctor must meet to get coverage.

"There are probably some doctors who will be uninsurable," added Janice Moskowitz, the state association's actuary.

State Sen. Randolph Townsend, R-Reno, said he wasn't sure it was normal for an underwriting association not to pick up the tail.

"Are we getting away from standard underwriting principles for a quick fix that may hurt us in the end?" Townsend asked. Batjer stressed that Guinn envisions the underwriting association as a temporary solution to a problem the Legislature must address in 2003. She also said that some doctors are proposing an underwriting association that has tail coverage.

The subcommittee spent most of the day listening to testimony from doctors detailing heart-wrenching accounts of how the high rates are forcing them to practice "defensive medicine," fall behind on their rent and watch as colleagues move to other states.

One doctor testified a colleague is moonlighting as a valet for a casino. Trial lawyers defended their practice, saying the crisis is not related solely to the fact that Nevada does not cap jury awards in medical malpractice cases. The attorneys said insurance companies, bad doctors and market forces share the blame.

The committee plans a number of hearings, each devoted to two or three main components of the crisis and possible reform.

Buckley said the committee will take up everything from alleged profiteering by insurance companies to problems with the state's medical screening panel and civil justice reforms.