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Insuring Controversy

When Malpractice Premiums Jump, Some Docs Ask Patients to 'Donate' to the Cause

By Sandra G. Boodman
Washington Post Staff Writer
Tuesday, September 21, 2004; Page HE01

Kenneth M. Greene wasn't sure how his 1,500 patients would react when he asked them for a $10 contribution to help pay his $11,000 malpractice insurance bill.

"The medical malpractice insurance crisis has come full force to Maryland," the 47-year-old Towson internist declared in a letter he sent last December. A "small donation . . . is necessary if we are to continue to keep our doors open."


Towson internist Kenneth M. Greene asked his patients to make a $10 contribution to cover a 28 percent increase in his premiums. (By Craig Herndon - The Washington Post)

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Surcharge Letter
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Nine hundred miles away in North Palm Beach, Fla., family physician Ira G. Warshaw launched a similar plan. Warshaw asked his 3,000 patients to send him a check for $125 ($25 if they were under 25) to help defray his $30,000 insurance bill, which has quadrupled since 2002. If patients didn't send him money, Warshaw warned in a letter earlier this year, he might be forced to stop participating with Medicare and some health plans.

"I felt like I was drowning, really," said Warshaw, a solo practitioner who said he felt "some guilt" about his request but was also grappling with a $100,000 debt from a failed venture in group practice. He felt compelled to act, he said, after his income dipped below the national average for his specialty, roughly $140,000.

Greene and Warshaw are among the pioneers of a new -- and controversial -- tactic that is being viewed with keen interest by medical groups around the country: the malpractice surcharge. Both doctors say their letters were so successful at generating funds that they plan to send another appeal before next year's insurance bills are due.

Rising expenses and static reimbursements have led a growing number of physicians, most of them in the less lucrative primary care specialties of pediatrics, family practice and internal medicine, to begin charging so-called access fees for services they once provided for free. These include filling out camp and disability forms, taking after-hours phone calls, and answering e-mail questions. Some are also dunning patients for canceled appointments.

A malpractice surcharge, some doctors say, is simply one more access fee, although it is usually presented as voluntary to avoid running afoul of Medicare rules that prohibit such mandatory charges. Its appeal is enhanced by the anger many doctors feel about rising insurance rates, which has touched off a fierce political battle in Maryland and other states.

"Physicians are getting crushed by the combination of malpractice cost shocks and declining reimbursement," said T. Michael Preston, executive director of MedChi, the Maryland state medical society. "As a result, there is great interest in surcharges or access fees."

Two-thirds of Maryland physicians, Greene among them, are insured by Medical Mutual Liability Insurance Society of Maryland, which increased rates an average of 28 percent this year. Last week the state insurance commissioner approved an average rate increase of 33 percent for 2005.

The Bush administration, backed by the American Medical Association (AMA) and other medical groups, is pushing legislation to limit liability costs, and reduce what the president last week called "junk lawsuits" that are driving "good docs" from practice. They advocate capping the amount of money patients harmed by medical negligence could collect from doctors and hospitals.

Maryland Gov. Robert Ehrlich (R) has endorsed reducing the state's cap on certain kinds of damages, but he faces fierce opposition from some leading lawmakers and trial lawyers' groups. Opponents of caps say premium increases are caused by cyclical variations in the economy and investment losses by insurance companies, not by outsized payouts. And they note that in Maryland, studies have found that rather than fleeing the state, the number of doctors has increased in recent years.

In addition to lobbying for caps at the state and national level, AMA officials are studying the issue of malpractice surcharges and may develop guidelines for members.

"Something's gotta give," said orthopedic surgeon Peter Lavine, president of the Medical Society of the District of Columbia. "One huge benefit is that [surcharges] will engage the public, which really isn't that engaged in the debate."

But some consumer advocates and medical ethicists warn that asking patients for more money at a time when they are facing other sharp increases in health costs may backfire. And officials of some groups, including the Medical Group Management Association (MGMA) which represents 1,900 practices employing 237,000 doctors, have warned their members to tread carefully before adding access fees, even voluntary ones, that some patients may regard as coercive.


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