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Medical Malpractice Rate Cuts Challenged

Stethoscope and gavel against a white backdrop.
Wikimedia Commons
The Florida Channel
Leon County Judge John Cooper on June 30, 2022, in a screen grab from The Florida Channel.

A major medical-malpractice insurer is challenging an order by Florida regulators to reduce rates by 15 percent, according to newly filed documents in the state Division of Administrative Hearings.

The Doctors Company made an annual rate filing in December that did not request changes in rates. But the state Office of Insurance Regulation said an analysis showed that rates should be reduced 11.9 percent to 17.3 percent and last month ordered the company to make a new filing that reflected rate cuts of 15 percent.

"The office finds that the (company) filings did not provide sufficient documentation or justification to demonstrate that the proposed rates were not excessive, inadequate, or unfairly discriminatory,'' said the June 2 order signed by Insurance Commissioner Kevin McCarty. "The office further finds that the proposed rates are excessive and that reductions of 15 percent from the current rates are appropriate for the referenced lines of business."

The order prompted The Doctors Company to request a hearing before an administrative law judge, with the request saying the insurer disputes facts cited by regulators in alleging that rates were excessive. The company is seeking a dismissal of the regulators' order.

The case was sent to the Division of Administrative Hearings last week, and Administrative Law Judge Suzanne Van Wyk had not set a hearing date as of Tuesday afternoon.

Based in California, The Doctors Company is a major player in Florida's medical-malpractice insurance industry. In 2011, it bought Jacksonville-based FPIC Insurance Group. A report produced last year by the Office of Insurance Regulation showed The Doctors Company with the largest market share in the state's medical-malpractice industry in 2013

Malpractice-insurance rates have long been a controversial political and legal issue in Florida. The Legislature and then-Gov. Jeb Bush passed malpractice legal changes in 2003, amid arguments that skyrocketing insurance rates were causing a crisis for physicians.

The Office of Insurance Regulation's 2014 annual report, released in January, said financial information indicates "the leading medical malpractice carriers are financially strong." But the Florida Supreme Court and a South Florida appeals court have issued rulings chipping away at limits on legal damages that were included in the 2003 law.