Three top medical malpractice insurers in California have rolled back their rates, saving doctors, dentists and other providers nearly $19 million a year in premiums, Insurance Commissioner Dave Jones announced Thursday.
Last year, Jones required the top six medical malpractice insurance companies in California to submit rate filings to the department to justify their current rates. Jones called for rate reductions by three companies following a review of the filings. The other three are still under review.
The reductions include:
· A 7.07 percent cut at Norcal Mutual Insurance Co., the second-largest medical malpractice insurance carrier in California, saving doctors and other medical providers $9.65 million
· A 13.42 percent cut at The Dentists Insurance Co., saving dentists almost $4 million
· A 19 percent cut at Medical Insurance Exchange of California's Physicians and Surgeons program, saving doctors $5.3 million
"This reduction, along with the 10 percent dividend we declared for 2012 to eligible policyholders, offers savings to our company's owners," Scott Diener, Norcal president and chief executive officer said in a statement. "We are very glad that Commissioner Jones allowed us to make the rate reduction retroactive to the beginning of the year to maximize the savings to policyholders."
"The California Department of Insurance routinely asks insurance carriers to submit new rates and The Dentists Insurance Co. is one of a number of medical liability carriers contacted," TDIC spokeswoman Alicia Malaby said in a statement. "TDIC worked collaboratively with CDI to achieve a rate reduction that will be beneficial to our policyholder members in California."
Jones used the announcement to tout support for legislation and a state initiative to give him authority to reject excessive health insurance rates, too.
"These medical malpractice insurance rate reductions demonstrate once again that giving the insurance commissioner the authority to reject excessive rates can result in major savings for policyholders, in this case for doctors, dentists and other medical providers," Jones said in a news release. "It simply defies
reason that the insurance commissioner has the authority to reject excessive health insurance rates for families, individual and businesses."
Democratic Assemblyman Mike Feuer from Los Angeles withdrew Assembly Bill 52 in the final days of the last legislative session. The bill remains inactive. A spokesman said Feuer is weighing options on how to proceed, given signature gathering for a statewide rate regulation initiative is underway.
"Under California law, doctors aren't allowed to be gouged by companies that sell medical malpractice insurance but patients can be gouged by health insurers because we don't have the same protections in place. That's why it is so important to change the law in California," said Doug Heller, executive director at Consumer Watchdog, the group that's circulating petitions to put a rate regulation initiative on the state ballot in November.