Consumer Advocates Demand Correction

Santa Monica, CA — The American Medical Association’s campaign to enact malpractice damage caps and weaken insurance reform reached a new low in Washington, D.C. last week when an AMA lawyer lied to a legislative committee about California law.

An AMA representative told a District of Columbia Council committee that rate rollbacks in California’s insurance reform law, Proposition 103, were declared invalid and policyholder refunds were not paid. In fact, the law was upheld as constitutional by the California Supreme Court, and insurance companies paid $1.2 billion in refunds to doctors and other consumers.

"In its radical attack on the American legal system and the rights of injured patients, the AMA cannot be trusted to tell the truth and has forfeited its credibility with lawmakers," said Harvey Rosenfield, the public interest lawyer who authored Proposition 103 and appeared at the D.C. hearing.

Rosenfield sent a letter demanding the AMA issue a written correction to the record. Read the letter.

Read Department of Insurance press releases, news articles and rulings upholding policyholder refunds under Proposition 103.

"Because the issue of Proposition 103‘s impact on insurance premiums has been raised in many legislative hearings in numerous states, at which representatives of the AMA have appeared as witnesses, it seems highly unlikely that your false testimony on this point of law and fact was an inadvertent misrepresentation," wrote Rosenfield. "Your reference to the Proposition 103 refunds was a deliberate attempt to discredit testimony which demonstrated that Proposition 103’s rollback alone… led to premium refunds for California physicians."

The AMA is hardly exonerated, even if misinformed, according to Rosenfield. "If the AMA’s members practice medicine as negligently as their representatives have investigated the facts about insurance reform, one has to fear for the safety of their patients."

The AMA is not the first proponent of damage caps to be caught misleading legislators and regulators. Malpractice insurance companies promote damage caps as necessary to lower malpractice premiums, yet testify that damage caps do not create savings or lower premiums when required to prove their claims under oath.

"While [a damage cap] was the legislature’s attempt at remedying the medical malpractice crisis in California in 1975, it did not substantially reduce the relative risk of medical malpractice insurance in California," testified an executive of malpractice insurance company SCPIE in a regulatory hearing before the California Department of Insurance.

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