Medical liability premiums surge again

Medical liability premiums have risen significantly again for the third consecutive year, according to an analysis from the American Medical Association (AMA).

In fact, the surge in premium rates from 2019 to 2021 is the highest in two decades. By comparison, year-to-year premiums have been relatively stable from 2010 to 2018, the AMA found. In 2019, the proportion of premiums that increased was about 27% –– almost double the rate from 2018. In 2020 and 2021, roughly 30% of premiums increased.

That is roughly opposite from premium trends in 2012, when the proportion of premiums that fell was 25.7%. In contrast, only 6.5% of premiums went down in 2021. Overall, the stability of medical liability premiums has been on the downswing over the last decade.

The higher premiums are likely to have an impact on patients and their ability to access healthcare services. Since the premium increases started before the COVID-19 pandemic, the issue only compounds other healthcare access challenges accelerated by the pandemic. However, the long-term effect of the pandemic on premiums is still unknown, and base premiums have not been affected for some time, the AMA stated.

“The medical liability insurance cycle is in a period of increasing premiums, compounding the economic woes for medical practices that struggled during the past two years of the pandemic,” AMA President Gerald E. Harmon, MD, said in a statement “The increase in premiums can force physicians to close their practices or drop vital services. This is detrimental to patients as higher medical costs can lead to reduced access to care.”