Todd Shryock

Medical liability insurance premiums are increasing after a decade of mostly steady rates, according to a new analysis from the American Medical Association (AMA). In 2020, more than 30% of premiums reported on a survey of 

 insurers increased from the previous year, the highest percent increase since 2005.

For a second consecutive year there has been an exceptional surge in the size of the increase. Between 2010 and 2018, the share of premiums that increased ranged from 12% to 17%. In 2019, that proportion almost doubled to 26.5% and rose in 2020 to 31.1%.

According to the AMA analysis, although some 2020 premiums may have been set after the onset of the COVID-19 pandemic, it was still too early for them to be affected by it.

“Increases in medical liability premiums compound the economic stress on medical practices as the 

 pandemic resulted in significant reductions to patient volume and revenue, and higher expenses for scarce medical supplies,” AMA President Susan R. Bailey, MD, said in a news release. “Practice revenue has not fully recovered as the pandemic has stretched on and a protracted upward trend in medical liability premiums will threaten the viability of many practices that already face a difficult road to recovery.”

The analysis identified the 14 states that had premium increases of 10% or more. Those states and their shares of reported premiums that increased by such magnitude in 2020 are: Kentucky (29.6%), South Carolina (27.8%), Maryland (18.8%), Nebraska (16.7%), Oregon (16.7%), Montana (16.7%), Georgia (14.8%), Missouri (14.8%), New Hampshire (13.3%), Illinois (11.9%), Michigan (11.6%), Texas (9.2%), North Carolina (6.7%), and Virginia (1.3%).

The AMA report also found striking differences in premiums by geography.

“Keeping medical liability premium growth in-check is imperative to ensure patient access to care is not jeopardized by unaffordable liability insurance costs that make it impossible for physicians to remain in practice,” said Bailey. “This concern is particularly pressing given the negative impact that the COVID-19 pandemic has had on access and practice viability, as many physicians have had to suspend patient visits or elective procedures, and some have had to close their practices.”

Together with state medical societies, the AMA is pursuing both traditional and innovative medical liability reforms to preserve premium stability. This includes limited and targeted emergency protections for physicians who continue to treat patients during the pandemic without adequate resources and support.

The newly released AMA analysis on medical liability insurance premiums is based on an annual survey of professional liability insurers conducted by the Medical Liability Monitor (MLM). The MLM reports base premiums for 3 specialties in each state where the responding insurers provide coverage. ❒

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Between 2010 and 2018, the share of premiums that increased ranged from 12% to 17%. Are they continuing to rise? 

Medical Liability Costs Are on the Rise

An analysis of data from the US Department of Health and Human Services conducted by the security firm 

 that collectively affected more than 26 million people. The report resulted in 6 key findings.

Attacks are increasing each year.Since 2018, the number of hacking and IT incidents has increased. Last year, hacking was the top cause of breaches, leading to 403 and 599 breaches (67%).

Hacking is resulting in larger breaches.Hacking compromised 91.2% of all exposed health care records in 2020—24.1 million out of 26.4 million.

The cost of breaches is rising. The average cost per breached record increased from $429 in 2019 to $499 in 2020. Data breaches cost health care organizations $13.2 billion last year.

Hacking is not the only problem.The remaining breach categories—unauthorized disclosure of personal health information by internal parties or systems, loss of theft devices, and miscellaneous leaks—exposed the personal details of about 2.3 million people, exposing victims to identify theft, phishing, and other forms of cyberattacks.

Breach numbers are up everywhere. 37 of 50 states suffered more breaches in 2020 than they did in 2019. California had the most at 49, surpassing last year’s leader, Texas, which suffered 43 in 2020.

Recovery is slow.In 2020, the average health care firm took 236 days to recover from a breach. ❒

Hacking and security breaches are rising at an alarming rate.

Todd Shryock

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Medical Liability Costs Are on the Rise

6 Essential Facts About Cyber Security