A.M. Best Revises Outlooks to Negative for ProAssurance Corporation and Certain Subsidiaries

September 26, 2019 by matray

AM Best has revised the outlooks to negative from stable and affirmed the Financial Strength Rating (FSR) of A+ (Superior) and the Long-Term Issuer Credit Ratings (Long-Term ICR) of “aa-” of certain members of the ProAssurance Group. Concurrently, AM Best has upgraded the FSR to A+ (Superior) from A (Excellent) and the Long-Term ICR to “aa-” from “a+” of Eastern Alliance Insurance Company (Lancaster, PA) and its affiliates that are now a part of ProAssurance Group. The outlook of these Credit Ratings (ratings) have been revised to negative from stable. Additionally, AM Best has affirmed the FSR of A- (Excellent) and the Long-Term ICR of “a-” of PACO Assurance Company, Inc. (PACO) (Springfield, IL). The outlook of these ratings remain stable.  (See below for a detailed listing of the companies ratings.)

All companies are indirect subsidiaries of ProAssurance Corporation (PRA).

Along with these rating actions, AM Best has revised the outlooks to negative from stable and affirmed the Long-Term ICR of “a-” of PRA and the Long-Term Issue Credit Rating (Long-Term IR) of “a-” on PRA’s $250.0 million 5.30% 10-year senior unsecured notes, due 2023. AM Best also has affirmed the indicative Long-Term IRs under the shelf registration of “a-” on the senior unsecured debt, “bbb+” on the senior subordinated debt and “bbb” on the preferred stock of PRA.

The ratings of ProAssurance Group reflect its balance sheet strength, which AM Best categorizes as strongest, as well as its strong operating performance, favorable business profile and appropriate enterprise risk management (ERM).

The negative outlooks reflect the negative trend in the ProAssurance Group’s operating performance in recent years, which has resulted in underwriting and operating metrics falling to a level that, although still solid, is more in-line with its peers in the medical professional liability (MPL) industry, instead of out-performing them. While the group continues to report favorable prior period reserve development, the magnitude of favorable development has declined in recent years and AM Best expects this trend to continue, especially given concerns with regard to rising loss costs in the MPL industry.

The group’s balance sheet strength assessment continues to reflect its strongest level of risk-adjusted capitalization, as measured by Best’s Capital Adequacy Ratio (BCAR), as well as the strength of its reserves and the quality of its investments. The ratings also consider the ProAssurance Group’s market position as one of the leading MPL insurers in the United States, as well as its diversification across multiple disciplines, geographic areas and in its other lines of business. These ratings also acknowledge the depth and breadth of the group’s ERM programs and policies. In addressing challenges in a prolonged soft MPL market, management has leveraged its talent, knowledge base and market position to introduce innovative alternatives.

The upgrade of the Eastern Alliance Insurance Company and its affiliates reflect their status as members of the ProAssurance Group due to their strategic importance as successful specialty workers compensation writers, common management and significant earnings contributions.

The ratings of PACO reflects its balance sheet strength, which AM Best categorizes as very strong, as well as its adequate operating performance, limited business profile and appropriate ERM. The ratings also reflect lift from the lead rating unit, ProAssurance Group, based on implicit support.

PACO’s ratings reflect its strongest risk-adjusted capital position and generally improved operating performance since being acquired by PRA in 2009. The company’s underwriting has been modestly profitable, benefiting from favorable industry trends in claims and losses in a lower-risk line of business during a softening market. PACO broadens PRA’s MPL lines of business to include chiropractors and acupuncturists, another niche medical specialty with favorable loss parameters.

Each of the rating units discussed above also benefits from the financial flexibility provided by PRA, the ultimate parent. PRA’s financial leverage is conservative, its interest coverage is solid and it holds cash and short-term investments outside of the insurance operating companies that are available for use without regulatory approval. At the same time, surplus growth at most rating units has been limited over the past five years by the payment of significant dividends to PRA, which they have utilized to pay shareholders’ dividends and repurchase company stock. Nonetheless, management remains committed to maintaining capital at the rated entities at levels commensurate with their ratings.

The outlooks have been revised to negative from stable and the FSR of A+ (Superior) and the Long-Term ICR of “aa-” have been affirmed for the following members of the ProAssurance Group:

• ProAssurance Casualty Company
• ProAssurance Indemnity Company, Inc.
• ProAssurance Specialty Insurance Company, Inc.
• Medmarc Casualty Insurance Company
• Noetic Specialty Insurance Company
• Podiatry Insurance Company of America
• ProAssurance American Mutual, A Risk Retention Group

The FSR has been upgraded to A+ (Superior) from A (Excellent) and the Long-Term ICRs to “aa-” from “a+” with the outlooks revised to negative from stable for Eastern Alliance Insurance Company and its affiliates:

• Allied Eastern Indemnity Company
• Eastern Advantage Assurance Company

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AMA Inaugurates Recognition Program in Fight Against Physician Burnout

September 24, 2019 by matray

The American Medical Association (AMA) recognized 22 healthcare organizations as the first recipients of the inaugural Joy in Medicine RecognitionThe new distinction offered by the AMA recognizes healthcare organizations that have committed to efforts that improve physician satisfaction and reduce burnout.

“It is a great honor to recognize the outstanding achievements of the organizations selected for the Joy in Medicine Recognition,” said AMA Board Chair Jesse M. Ehrenfeld, MD, MPH. “These organizations are true leaders in promoting physician well-being and continue to make a difference in the lives of our nation’s health are workforce.”

Candidates and their achievements to reduce physician burnout were evaluated against criteria demonstrating competencies in commitment, assessment, leadership, efficiency of practice environment, teamwork and support.

The recipients of the inaugural Joy in Medicine Recognition are:

Ascension Medical Group, St. Louis, Mo.
Beth Israel Deaconess Medical Center, Boston, Mass.
Boston Medical Center, Boston, Mass.
Cleveland Clinic, Cleveland, Ohio
Geisinger Health System, Danville, Pa.
Gould Medical Group, Modesto, Calif.
Heartland Health Centers, Chicago, Ill.
Icahn School of Medicine Mount Sinai, New York, N.Y.
Mayo Clinic, Rochester, Minn.
National Capital Region Military Health System, Bethesda, Md.
Northwestern Medicine, Chicago, Ill.
Oak Street Health, Chicago, Ill.
Ochsner Health System, New Orleans, La.
Southern California Permanente Group, Calif.
St. Vincent Medical Group, Ind.
Stanford Health Care, Palo Alto, Calif.
University of Colorado School of Medicine, Aurora. Colo.
UNC Health Care, Chapel Hill, N.C.
UPMC, Pittsburgh, Pa.
University of Rochester Medical Center, Rochester, N.Y.
Virginia Mason Medical Center, Seattle, Wash.
Wake Forest School of Medicine, Winston-Salem, N.C.

The Joy in Medicine Recognition Program is a component of the AMA’s Practice Transformation Initiative, an ambitious new course of action to advance evidence-based solutions that fill the knowledge gap in effective solutions to the physician burnout crisis.

“The Joy in Medicine Recognition Program is designed by the AMA to serve as a guide and catalyst for organizations who are interested, engaged and committed in efforts to fight the root causes of physician burnout,” said Ehrenfeld said. “The AMA is optimistic that the program will serve as a roadmap to reduce burnout within organizations and unite the health care community around systematic changes that will energize physicians in their life’s work of caring for patients.”

The founding of the Joy in Medicine Recognition Program was influenced by three timely and prominent sources — a call-to-action blog post in Health Affairs titled Physician Burnout is a Public Health Crisis: A Message to our Fellow CEOs, a research article published in JAMA Internal Medicine titled The Business Case for Investing in Physician Well-being and the multi-stakeholder effort resulting in the Charter on Physician Well-being.

The AMA continues to work on every front to address the physician burnout crisis. Through its research, collaborations, advocacy and leadership, the AMA is working to make the patient‐physician relationship more valued than paperwork, preventive care the focus of the future, technology an asset and not a burden, and physician burnout a thing of the past.

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Michael G. Roque Joins CMIC Group as Chief Operating Officer

September 11, 2019 by matray

CMIC Group announced that Michael G. Roque has joined the CMIC Group team as the new Chief Operating Officer.

Roque has more than 20 years of experience in medical professional liability, working on both the broker and carrier sides. Most recently, he served as vice president of Business Development at NORCAL Mutual Insurance Co. Roque holds a BBA in Risk Management & Insurance from Temple University.

“We are very pleased to have Michael join our Team,” said Stephen J. Gallant, chief executive officer of CMIC Group. “His knowledge and experience within the MPL industry will be a tremendous asset for the company. We look forward to his leadership and insight as we continue to grow the company.”

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ProAssurance Declares Quarterly Dividend

September 5, 2019 by matray

The Board of Directors of ProAssurance Corp. has declared a cash dividend of $0.31 per common share, payable on Oct. 11, 2019, to shareholders who own our stock as of Sept. 27, 2019.

The company's dividend policy anticipates a total annual dividend of $1.24 per share, to be paid in equal quarterly installments. However, any decision to pay future cash dividends will be subject to the Board’s final determination after a comprehensive review of the ProAssurance's financial performance, future expectations and other factors deemed relevant by the Board.

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