Highmark Blue Cross Blue Shield and other health plans in the state are being asked to spend up to $220 million to help physicians pay for malpractice insurance.
The plan announced yesterday in Philadelphia by Gov.-elect Ed Rendell comes in response to growing complaints from physicians about steep increases in malpractice insurance premiums. Doctors in high-risk specialties such as orthopedic surgery and obstetrics have threatened to leave the state if the situation doesn't improve.
The one-time emergency assessment would tax the surpluses held by all companies writing health insurance in Pennsylvania. The amount would varying according to the size of the surpluses.
It wasn't immediately clear how big the levy against Highmark Blue Cross Blue Shield would be and what impact it would have.
Doctors in Pennsylvania must purchase two layers of malpractice insurance. The first comes from commercial insurers, which provide primary coverage up to $500,000. The second comes from the state-run MCARE Fund, which covers claims up to $1 million.
Rendell's proposal, to be introduced in the Legislature next month, would eliminate for one year the MCARE premium for doctors in high-risk specialties. Premiums would be cut in half for all other physicians.
Ken Snyder, a spokesman for Rendell, described the situation for one orthopedic surgeon in the Philadelphia area: The doctor currently pays $130,000 for both layers of malpractice insurance, but under the governor's plan the MCARE premium of roughly $40,000 would be wiped away.
Insurance costs in Philadelphia are higher than in Pittsburgh, but physicians here would also see savings.
A survey this fall found that obstetricians in Pittsburgh paid on average $35,375 for their primary insurance and another $19,000 for their MCARE coverage, said Chuck Moran, spokesman for the Pennsylvania Medical Society. General surgeons in Pittsburgh were paying $27,563 for their primary coverage and $17,000 for MCARE.
Rendell's solution is "creative and unique," said Dr. Gerald Pifer, an orthopedic surgeon at Allegheny General Hospital and president of the Allegheny County Medical Society. "Those reserves have been accumulated from subscribers who have paid premiums for health-care services, and this is part of the cost of providing health care, so, I don't think there is a problem as far as I can see with taking the dollars from that area."
But the Rendell proposal also left numerous unanswered questions.
The state requires health insurers to meet minimum capital requirements, but the Blues maintain that even those aren't a true reflection of how much money they might need to to deal with unanticipated claims.
The Insurance Department held hearings earlier this year to determine whether the "financial reserves" held by the state's four Blue Cross and Blue Shield plans were excessive. The department has not taken any action so far.
Rendell's proposal starts with an assessment of 2 percent on all health insurers' surpluses. Then, to tap into plans with bigger surpluses, it would levy 5 percent on surpluses equal to 60 to 90 days' worth of claims, and 10 percent on surpluses that exceed 90 days 'worth of claims.
Also yesterday, Rendell announced that he was pushing for new rules requiring trial lawyers filing malpractice suits to submit certificates attesting to the merits of the claim. That could save money by eliminating frivolous cases, doctors say.
Rendell said yesterday that his Medical Malpractice Liability Task Force has talked with the civil rules committee of the Pennsylvania Supreme Court about the requirement, which Rendell said would be adopted early next year.
John Gismondi, a Pittsburgh lawyer and chairman of the medical malpractice section of the Pennsylvania Trial Lawyers Association, said lawyers who bring a large number of these cases wouldn't have a problem with the requirement.
"I never file a complaint unless I already have that expert report in my hand," he said.
But exactly which physicians would be allowed to issue a certificate of merit -- an independent designee of the Supreme Court or an expert witness brought by the plaintiff -- was unclear yesterday.
Rendell also said he would support legislation to subsidize trauma centers in Pennsylvania at a cost of about $20 million.
The medical malpractice issue has commanded extra attention in Eastern Pennsylvania because of the threatened closure of trauma units where doctors couldn't afford coverage.
Christopher Snowbeck can be reached at csnowbeck@post-gazette.com or 412-263-2625. Post-Gazette staff writer Pamela Gaynor contributed to this article
E-mail this story 
