August 8, 2024 by matray

Below are some headlines and article synopses from the August 2024 issue of Medical Liability Monitor. To read the articles in their entirety, please subscribe today.

Georgia Supreme Court Rules COVID Orders Tolled Statute of Limitations
The Supreme Court of Georgia ruled last month that a statewide COVID-19 judicial emergency order issued in March 2020 can be applied to toll, or pause, the state’s five-year statute of repose for medical liability cases. The unanimous decision overturns a prior unanimous decision by the Georgia Court of Appeals that prevented a medical professional liability claim against Floyd Medical Center from proceeding …

Study Shows risks of Integrating AI Into Medical decision-making
Researchers at the National Institutes of Health (NIH) found that an artificial intelligence (AI) model solved medical quiz questions — designed to test health professionals’ ability to diagnose patients based on clinical images and a brief text summary — with high accuracy. However, physician-graders found the AI model made mistakes when describing images and explaining how its decision-making led to the correct answer. The findings, which shed light on AI’s potential in the clinical setting, were published in npj Digital Medicine. The study was led by researchers from NIH’s National Library of Medicine and Weill Cornell Medicine, New York City, N.Y. …

California Court of Appeal Affirms Medical Liability Plaintiff Attorneys Lacking Expert Testimony Open to Malicious Prosecution Claims
The California Court of Appeal for the Second District, Fourth Division last month affirmed that plaintiff attorneys who bring medical liability actions without expert testimony are open to malicious prosecution claims …

Michigan Supreme Court Expands Admissibility of Expert Testimony in Medical Liability Lawsuits
The Michigan Supreme Court issued two opinions last month that broaden the scope of admissible expert witness testimony in medical liability lawsuits. The first opinion involved expert testimony that lower courts determined inadmissible because the expert failed to cite any published medical literature or other authority to support their opinion that the defendants had breached the standard of care. The second opinion combined two medical liability cases where plaintiffs’ expert witnesses did not practice the same subspecialty as the defendant physician …

Louisiana Adds Transparency to Third-Party Litigation Financing
Louisiana Gov. Jeff Landry recently signed into law a bill that will contribute greater transparency about the involvement of third-party litigation funders in subsidizing civil litigation in the state. The new statute, Senate Bill 355, went into effect on August 1, and makes litigation financing contracts subject to discovery in civil liability lawsuits …

Coverys Expands London Insurance Platform with Regulatory Approval
Coverys announced last month that its dedicated London platform Coverys Ltd. received approval from the UK’s Prudential Regulatory Authority and Financial Conduct Authority to commence underwriting medical liability risk. The approvals enable the organization to expand its product offerings in the London market, supporting Coverys’ global growth and diversification strategy. Coverys Ltd. is part of Coverys’ dedicated London platform, which includes both an insurance company and managing general agent operations, collectively “Coverys London” …

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August 1, 2024 by matray

Ryan Specialty, an international specialty insurance firm, announced that it is forming an exclusive relationship with MagMutual Insurance Co. This relationship is through Sapphire Blue, which specializes in developing sophisticated solutions to complex healthcare risks, and is a part of the firm’s underwriting specialty, Ryan Specialty Underwriting Managers.

Sapphire Blue underwrites senior living and allied healthcare liability and will become MagMutual’s exclusive underwriter for policyholders outside the traditional physician and hospital model, most significantly as related to senior living and allied healthcare facilities.

According to Ryan Specialty, the exclusive relationship will strengthen product innovation, customer service, and risk management.

“MagMutual is a leader in the physicians and hospital professional liability insurance market, and we are pleased to strategically align our healthcare practice with them,” said Patrick Ryan, founder, chairman and chief executive at Ryan Specialty. “We appreciate the collaboration of Neil Morrell and MagMutual’s talented team during this process, and we look forward to jointly bringing innovation and greater customer solutions to our clients and their insureds.”

“Bringing together the two most positively disruptive, fastest-growing and customer-focused organizations in healthcare liability insurance is an exciting prospect for our current and future agents and customers,” said Neil Morrell, MagMutual chief executive officer. “The synergies are not only self-evident, they are potentially transformative.”

"The collective experience, expertise and brand recognition of our two organizations is exceptional in the healthcare liability marketplace,” said Nancy McMahon, Saphire Blue chief executive officer. “Together we will expand our healthcare liability products and offerings to better serve those who care for others.”

July 30, 2024 by matray

Integris Group announced that the Accreditation Council for Continuing Medical Education (ACCME) has affirmed the accreditation of its Continuing Medical Education (CME) program through July of 2027. The decision followed a rigorous application process, including the completion of a recent progress report, which resulted in the company’s full approval to provide its members with ACCME accredited CME courses.

“The ACCME’s recent decision to fully approve our program’s accreditation showcases our dedication to providing our members with the highest quality educational content,” said Denise Condron, VP of Risk Management at Integris Group. “Each course we add to our extensive educational catalog is a product of this commitment and demonstrates the pride we take in ensuring that our program delivers relevant, informative, and valuable information to our policyholders.”

Integris Group’s educational library includes live events, webinars and self-study materials. Additional content is added regularly.

July 18, 2024 by matray

AM Besthas affirmed the Financial Strength Rating of A++ (Superior) and the Long-Term Issuer Credit Ratings of “aa+” (Superior) of the members of MedPro Group (MedPro). These Credit Ratings (ratings) apply to The Medical Protective Company (Fort Wayne, IN) and its affiliates: Princeton Insurance Company (Princeton, NJ); PLICO, Inc. (Oklahoma City, OK); Wellfleet Insurance Company (Fort Wayne, IN); and Wellfleet New York Insurance Company (Flushing, NY); as well as MedPro’s two reinsured affiliates, MedPro RRG Risk Retention Group and AttPro RRG Reciprocal Risk Retention Group (both domiciled in the District of Columbia). The outlook of these ratings is stable.

The ratings reflect MedPro’s balance sheet strength, which AM Best assesses as strongest, as well as its strong operating performance, favorable business profile and appropriate enterprise risk management.

The ratings acknowledge MedPro’s risk-adjusted capitalization being at the strongest level, as measured by Best’s Capital Adequacy Ratio (BCAR), as well as the group’s long-term profitable operating performance and the leading market position it maintains in the medical professional liability (MPL) sector, proving the group’s ability to underwrite profitably through market cycles. Additionally, the ratings consider the group’s substantial distribution capabilities, prudent claims-handling philosophy and culture of holistic risk management. The group consistently outperforms peers by most metrics, illustrated by substantial historical returns on equity, low operating ratios and solid net underwriting income. Furthermore, the ratings benefit from the explicit and implicit financial support provided by its affiliate, National Indemnity Company, and MedPro’s ultimate parent, Berkshire Hathaway Inc. [NYSE: BRK A and BRK B], which includes reinsurance programs, investment opportunities and capital support.

Partially offsetting these positive rating factors are the inherent challenges associated with the MPL line of business, particularly as it relates to price competition, changing market dynamics, potential changes in legislation (i.e., tort reform), increasing loss cost trends and regulatory risk. At the same time, AM Best recognizes the organization’s strong management team, diversified premium base and jurisdictional diversity, which have contributed to MedPro outperforming its peers over the longer term.

The group’s large allocation to common stocks exposes it to significant volatility during periods when the equity markets experience sharp declines. The group has demonstrated its ability to absorb this volatility historically and maintain the strongest level of risk-adjusted capitalization, as measured by BCAR, due to its low underwriting leverage, driven by its affiliated reinsurance agreement with National Indemnity Company and MedPro’s substantial capital position, and the investment managers’ historical trend of success in turbulent markets.  

July 16, 2024 by matray

Fitch Ratings Affirms 'A' Ratings, 'Stable' Outlook for The Doctors Company.

Fitch Ratings affirmed its “A” (Strong) Insurer Financial Strength ratings for The Doctors Company. The outlook of these ratings is "Stable."

The ratings are based on Fitch's assessment of the company's very strong statutory capital position and sufficient loss reserve levels. Fitch recognized The Doctors Company's market position as the nation's number-two writer of medical professional liability insurance.

The "A" with "Stable Outlook" ratings include:

• The Doctors Company, an Interinsurance Exchange


• The Doctors Company Risk Retention Group, a Reciprocal Exchange


• TDC National Assurance Company


• TDC Specialty Insurance Company

July 11, 2024 by matray

Below are some headlines and article synopses from the July 2024 issue of Medical Liability Monitor. To read the articles in their entirety, please subscribe today.

Nuclear Jury Verdicts Have Surged During the Last Decade
Nuclear jury verdicts in personal injury and wrongful death cases have surged during the last decade, according to a new report from the U.S. Chamber of Commerce Institute for Legal Reform (ILR). The report’s authors define a nuclear verdict as a jury determination in favor of the plaintiff with a damage award that surpasses $10 million. Key findings from the report indicate that approximately half of the studied nuclear verdicts were between $10 million and $20 million, and more than a third were between $20 million and $50 million. The remaining 19% exceeded $50 million, including 115 “mega” nuclear verdicts of $100 million or more. The median nuclear verdict during the study period was $21 million, and the mean was substantially higher at $89 million. Medical liability verdicts had a $19.6 million median and a $33.6 million mean during the 10-year study period …

Number of Patient Harms rose 59% Globally Between 1990, 2019
The number of patient harms associated with medical treatment rose by 59% globally — from 11 million to 18 million — between 1990 and 2019, according to a new data analysis published online in the journal BMJ Quality & Safety. Patient harms outpaced the 45% increase in the world’s population during the same period. And older people bore the brunt of these adverse incidents, with the steepest rise among 65-69 year olds, the findings show …

Berkshire Hathaway Leads MPL in DPW
Berkshire Hathaway maintained its spot as the leading provider of medical professional liability insurance in the U.S. based on claims-made coverage with $1.3 billion in direct premiums written (DPW) in 2023. This figure represents a slight 0.2% decrease in annual premium for the company, according to a Best’s Rankings report released last month. The report evaluates the DPW for the top providers of claims-made medical professional liability insurance …

Colorado Supreme Court to Decide If Damages Cap Applies to Interest
The Colorado Supreme Court last month agreed to review whether a provision in state law that typically capped recoverable economic and noneconomic damages at $1 million also applies to the interest accrued from the time of the plaintiff’s injury. Colorado judges retain discretion to pierce the cap when there is a finding of good cause to believe that the cap is unfair and that economic damages alone would exceed the umbrella cap limit …

Inflation’s Double-Edged Sword Impacts First-Quarter 2024 Financial Results for MPL Specialty Writers
An analysis of first-quarter financial results for the MPL industry indicates elevated inflation resulted in higher-than-average underwriting expense growth in 2023 and 2024, but also helped investment yields achieve better returns than the five-year Treasury Bond would offer …

The AMA Adopts New Prior Authorization Reform Policies
Physician and medical student leaders at the Annual Meeting of the American Medical Association (AMA) House of Delegates last month approved two new policies aimed at fighting for greater health insurer accountability and transparency against the backdrop of proliferating, onerous prior authorization requirements that are delaying and denying necessary care for patients and adding administrative burdens for physicians. The House of Delegates is the AMA’s policymaking body …

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July 11, 2024 by matray

Coverys recently announced that Coverys Limited has received Prudential Regulatory Authority (PRA) and Financial Conduct Authority (FCA) approval to commence underwriting, effective June 26, 2024. This approval enables the organization to expand its offerings in the London market, supporting Coverys’ global growth and diversification strategy.

Coverys Limited has also been approved for admittance to the National Association of Insurance Commissioners (NAIC) Quarterly Listing of Alien Insurers, effective July 1, 2024. A company’s presence on the Quarterly Listing allows a non-U.S. insurer to write excess or surplus lines business in all states on a non-admitted basis. Regulatory approval comes on the heels of AM Best assigning an Excellent Financial Strength Rating (FSR) and a Long-Term Issuer Credit Rating (Long-Term ICR) of “A” (Excellent) to Coverys Limited.

Coverys Limited is part of Coverys’ dedicated London platform, which includes both an insurance company and MGA operations (collectively “Coverys London”). To lead the newly expanded London operation, Coverys has appointed Stef Raftopoulos as CEO of Coverys London, reporting to Coverys CEO Joseph Murphy. In addition, chief underwriting officer Chris Brooking and finance director Michael Bell, who together with Raftopoulos bring more than 85 years of combined global insurance experience to the team, will assist Raftopoulos in heading the Coverys London operation.

Mike Sibthorpe is stepping down as CEO of Coverys London following the completion of the goals set for his tenure. Sibthorpe joined Coverys with the task of leading the reorganization of the London office and the development of an alternative platform to replace Coverys’ Syndicate 1975.

Building on the organization’s commitment to the London market, Coverys London will write a balanced portfolio of both medical liability insurance and healthcare reinsurance across a broad range of specialty lines in which Coverys has well-established product offerings and risk mitigation services. This includes an expansion of the services and flexibility previously provided through Coverys’ Syndicate 1975.

Joseph G. Murphy, President and CEO of Coverys, said, “With the creation of the Coverys London platform and regulatory approval, Coverys can expand options for risk-taking through the London marketplace while also providing the level of service and expertise our long-standing clients and partners have come to expect,” Murpphy said. “The expansion of our London platform is just one of the ways we are evolving our offerings across the markets we serve to further our mission to protect and support healthcare professionals worldwide.”

July 9, 2024 by matray

Matthew Germak, MD, MPH, will be the new vice president for patient safety at CRICO, the medical professional liability insurance program serving the Harvard medical community and its affiliate organizations. He will assume this role beginning July 15, 2024.

As vice president, Germak will report to Luke Sato, MD, senior vice president and chief medical officer of CRICO. In this capacity, he will have oversight of strategic and operational patient safety solutions for all CRICO subscribers. His responsibilities will include advancing CRICO’s patient safety strategy, convening clinical leaders, overseeing protected discussions of the AMC PSO, designing CRICO’s educational programs and supporting advanced clinical data analytics.

“Matt is a respected leader in patient safety and highly regarded by our insured network. I expect him to bring a fresh perspective and insight to our team, allowing us to better address the quality and safety challenges faced by our community,” said Mark E. Reynolds, CRICO president and chief executive.

Germak joins CRICO with extensive experience in patient safety. During the last four years, he has been Beth Israel Lahey Health Primary Care’s (BILHPC) first chief quality and safety officer and has been a primary care physician for eight years at BILHPC – Wellesley Family Medicine. Matt also currently serves as BILH’s principal investigator in CRICO’s Ambulatory Safety Net Program.

“We are thrilled to have Matt join us as VP of Patient Safety, as he’s been working with CRICO as our Medical Director of Primary Care since 2022,” Sato said. “The combination of his experience as a clinician and achievements in healthcare quality and safety make him a perfect fit for our organization and our subscribers.”

June 20, 2024 by matray

AM Best has affirmed the Financial Strength Rating (FSR) of A (Excellent) and the Long-Term Issuer Credit Ratings (Long-Term ICR) of “a+” (Excellent) of the members of ProAssurance Group. Concurrently, AM Best has affirmed the Long-Term ICR of “bbb+” (Good) and the existing indicative Long-Term Issue Credit Ratings (Long-Term IR) of ProAssurance Corporation (PRA) (headquartered in Birmingham, AL). The outlook of the Credit Ratings (ratings) is stable. All companies are indirect subsidiaries of PRA. (See below for a detailed listing of subsidiaries and indicative Long-Term IRs.)

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

The group’s balance sheet strength assessment remains in the strongest range reflective of its strongest level of risk-adjusted capitalization, as measured by Best’s Capital Adequacy Ratio (BCAR), as well as quality of investments, adequate liquidity and strength of reserves. Loss reserve development trends over the prior 10 calendar and accident years have been mixed, driven in part by adverse development reported by the NORCAL subsidiaries, the development associated with a large national healthcare account and the emergence in 2023 of adverse development on the workers compensation line of business, reflecting the impact of rising medical severity.

The ratings also consider ProAssurance Group’s operating performance, which remains adequate, despite some deterioration over the past five-year period. The group’s operating results were impacted by the large national healthcare account’s non-renewal and the challenging loss environment in the specialty property/casualty segment’s healthcare professional liability and workers compensation segments, reflecting ongoing significant increases in average claim costs. Operating performance results and profitability in 2023 and through the first quarter of 2024 were bolstered by net investment income following the reallocation of investments and the continuation of higher yields. The ratings also consider the group’s national market position as one of the leading medical professional liability insurers in the United States with its breadth of product offerings across multiple disciplines, and geographic diversification. The ratings also recognize the group’s developed ERM framework and risk management capabilities across the organization.

The ratings also benefit from the financial flexibility afforded by PRA, the ultimate parent via access to the capital markets. PRA’s financial leverage is modest with adequate interest coverage, holding a significant amount of cash and short-term investments outside the insurance operations, which are available for use without regulatory approval or restriction. However, surplus growth has been limited over the most recent five-year period due to significant payments of dividends to PRA, which the parent has utilized for company stock repurchases and payment of shareholders’ dividends, and unrealized capital losses partially offsetting profitability. Management continues to remain committed to maintaining capital strength at its rated entities at levels commensurate with their ratings.

The stable outlooks reflect AM Best’s expectation that the group will maintain its strongest level of balance sheet strength assessment, supported by effective capital management, while ongoing initiatives implemented by management will maintain stable operating performance, supported by its favorable business profile.

Negative rating actions may occur if the group’s loss experience continues to impact underwriting profitability negatively and leads to further deterioration in operating performance trends. Negative rating action may also occur if the group's balance sheet strength weakens, which could result from deterioration of risk-adjusted capitalization or further adverse reserve development in its workers compensation or medical professional liability books from rising claims frequency or severity, or changes in regulatory, legislative and judicial actions. While unlikely in the near term, positive rating actions may occur following a positive trend in operating performance metrics that outpaces the group’s peers and materially contributes to surplus growth.

The FSR of A (Excellent) and the Long-Term ICRs of “a+” (Excellent) have been affirmed, with stable outlooks for the following members of ProAssurance Group:

• ProAssurance Indemnity Company, Inc.
• ProAssurance Specialty Insurance Company
• Medmarc Casualty Insurance Company
• ProAssurance Insurance Company of America
• ProAssurance American Mutual, A Risk Retention Group
• Allied Eastern Indemnity Company
• Eastern Advantage Assurance Company
• Eastern Alliance Insurance Company
• NORCAL Insurance Company
• NORCAL Specialty Insurance Company
• Medicus Insurance Company
• FD Insurance Company
• Preferred Physicians Medical Risk Retention Group, a Mutual Insurance Company

The following indicative Long-Term IRs under the shelf registration have been affirmed with stable outlooks:

ProAssurance Corporation— -- “bbb+” (Good) on senior unsecured debt -- “bbb” (Good) on senior subordinated debt -- “bbb-” (Good) on preferred stock

June 20, 2024 by matray

AM Best has affirmed the Financial Strength Rating (FSR) of A (Excellent) and the Long-Term Issuer Credit Ratings (Long-Term ICR) of “a+” (Excellent) of the members of ProAssurance Group. Concurrently, AM Best has affirmed the Long-Term ICR of “bbb+” (Good) and the existing indicative Long-Term Issue Credit Ratings (Long-Term IR) of ProAssurance Corporation (PRA) (headquartered in Birmingham, AL). The outlook of the Credit Ratings (ratings) is stable. All companies are indirect subsidiaries of PRA. (See below for a detailed listing of subsidiaries and indicative Long-Term IRs.)

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

The group’s balance sheet strength assessment remains in the strongest range reflective of its strongest level of risk-adjusted capitalization, as measured by Best’s Capital Adequacy Ratio (BCAR), as well as quality of investments, adequate liquidity and strength of reserves. Loss reserve development trends over the prior 10 calendar and accident years have been mixed, driven in part by adverse development reported by the NORCAL subsidiaries, the development associated with a large national healthcare account and the emergence in 2023 of adverse development on the workers compensation line of business, reflecting the impact of rising medical severity.

The ratings also consider ProAssurance Group’s operating performance, which remains adequate, despite some deterioration over the past five-year period. The group’s operating results were impacted by the large national healthcare account’s non-renewal and the challenging loss environment in the specialty property/casualty segment’s healthcare professional liability and workers compensation segments, reflecting ongoing significant increases in average claim costs. Operating performance results and profitability in 2023 and through the first quarter of 2024 were bolstered by net investment income following the reallocation of investments and the continuation of higher yields. The ratings also consider the group’s national market position as one of the leading medical professional liability insurers in the United States with its breadth of product offerings across multiple disciplines, and geographic diversification. The ratings also recognize the group’s developed ERM framework and risk management capabilities across the organization.

The ratings also benefit from the financial flexibility afforded by PRA, the ultimate parent via access to the capital markets. PRA’s financial leverage is modest with adequate interest coverage, holding a significant amount of cash and short-term investments outside the insurance operations, which are available for use without regulatory approval or restriction. However, surplus growth has been limited over the most recent five-year period due to significant payments of dividends to PRA, which the parent has utilized for company stock repurchases and payment of shareholders’ dividends, and unrealized capital losses partially offsetting profitability. Management continues to remain committed to maintaining capital strength at its rated entities at levels commensurate with their ratings.

The stable outlooks reflect AM Best’s expectation that the group will maintain its strongest level of balance sheet strength assessment, supported by effective capital management, while ongoing initiatives implemented by management will maintain stable operating performance, supported by its favorable business profile.

Negative rating actions may occur if the group’s loss experience continues to impact underwriting profitability negatively and leads to further deterioration in operating performance trends. Negative rating action may also occur if the group's balance sheet strength weakens, which could result from deterioration of risk-adjusted capitalization or further adverse reserve development in its workers compensation or medical professional liability books from rising claims frequency or severity, or changes in regulatory, legislative and judicial actions. While unlikely in the near term, positive rating actions may occur following a positive trend in operating performance metrics that outpaces the group’s peers and materially contributes to surplus growth.

The FSR of A (Excellent) and the Long-Term ICRs of “a+” (Excellent) have been affirmed, with stable outlooks for the following members of ProAssurance Group:

• ProAssurance Indemnity Company, Inc.
• ProAssurance Specialty Insurance Company
• Medmarc Casualty Insurance Company
• ProAssurance Insurance Company of America
• ProAssurance American Mutual, A Risk Retention Group
• Allied Eastern Indemnity Company
• Eastern Advantage Assurance Company
• Eastern Alliance Insurance Company
• NORCAL Insurance Company
• NORCAL Specialty Insurance Company
• Medicus Insurance Company
• FD Insurance Company
• Preferred Physicians Medical Risk Retention Group, a Mutual Insurance Company

The following indicative Long-Term IRs under the shelf registration have been affirmed with stable outlooks:

ProAssurance Corporation— -- “bbb+” (Good) on senior unsecured debt -- “bbb” (Good) on senior subordinated debt -- “bbb-” (Good) on preferred stock