Tag Archives: Susan Forray

Industry’s profitability declines slightly while maintaining overall favorable results

While on a downward trend, movement in the medical professional liability (MPL) industry has occurred at a relatively slow pace. Surplus grew slightly in 2016, leaving the MPL industry in a financial position roughly consistent with where it has been for the past half-decade. Milliman consultants Chad Karls and Susan Forray provide more perspective in their recent Inside Medical Liability article.

Medical professional liability industry’s profitability declines while maintaining overall favorable results

Surplus grew slightly in 2015, leaving the medical professional liability (MPL) industry in a financial position roughly consistent with where it has been since the end of 2011. The increased capitalization and favorable operating ratios in the MPL industry of late have had one primary cause, the release of prior-year reserves. In 2015 in particular, reserve releases contributed 24 points to the industry’s operating reserves. The reserve releases are similar to those during 2014 and represent a decline relative to each of the years 2008 through 2013. Milliman consultants Chad Karls and Susan Forray provide more perspective in their recent Inside Medical Liability article.

A chain reaction

Previously, the medical professional liability (MPL) industry could afford to be less attentive to changes in the healthcare delivery system because the business of healthcare and practice of medicine had been very stable during the course of recent decades. That changed with the passage of the Patient Protection and Affordable Care Act, which created a chain reaction throughout the entire healthcare industry. The MPL industry is now responding to the broad effects of healthcare reform. Milliman consultant Susan Forray provides more perspective in this article.

This article was originally published in the October 2015 issue of the Medical Liability Monitor.

Medical professional liability profitability continues to decline from peak levels

In 2014, surplus grew slightly, leaving the medical professional liability (MPL) industry in a financial position roughly consistent with where it’s been since the end of 2011. The release of prior-year reserves has spurred the increased capitalization and favorable operating ratios in the MPL industry of late. Additionally, the industry’s pattern of declining frequency has ended, and indemnity severity trends have remained manageable. MPL insurers continue to face declining market share, which is due to the continued acquisition of physician practices by hospitals and healthcare systems and the preference of newly trained physicians to join them. Milliman consultants Chad Karls and Susan Forray provide perspective in this article.

Reprinted from the Second Quarter 2015 issue of Inside Medical Liability, Physician Insurers Association of America. Copyright, 2015.

Medical professional liability industry update

The year 2013 was once again a year of financial growth for the medical professional liability (MPL) insurance industry, despite a continued decline in profitability. While the industry’s operating ratio remains well below 100%, it has increased noticeably relative to 2011, driven by a decline in reserve releases, increased expenses, and diminished investment income.

Despite this decline in profitability, the MPL industry again returned a substantial portion of its income as dividends to policyholders. Surplus also grew moderately in 2013, providing the MPL industry with additional capital support. MPL writers continue to confront the risk associated with a possible increase in inflation and continue to face uncertainties stemming from healthcare reform.

To get a more detailed picture of the state of the MPL industry today, Milliman’s Chad Karls and Susan Forray have analyzed the financial results of a composite of 38 of the largest specialty writers of MPL coverage using statutory data. The consultants have compiled various financial metrics for the industry in this article.

Reprinted from the Second Quarter 2014 issue of Inside Medical Liability, Physician Insurers Association of America. Copyright, 2014.

Tort overhaul: Patient compensation system legislation raises more questions than answers

In recent legislative proposals in Florida and Georgia, lawmakers have sought to establish a patient compensation system (PCS) as an alternative to litigation for compensating patients with injuries that could have been avoided under alternative healthcare (referred to as “medical injuries” within the legislation).

Proponents say offering a PCS as an alternative to litigation could lead to faster outcomes with claims. Advocates claim that faster claim resolutions and less attorney involvement would ultimately reduce overall costs, while providing access to compensation for more patients. They also argue that this system would benefit claimants with minor injuries, who are frequently excluded under the current system, because their claims generally do not result in the kind of large monetary awards that make taking a medical professional liability (MPL) case cost-effective for plaintiff attorneys.

Can PCSs really provide the many benefits, in cost savings, fairness, greater access, and efficiencies, that their proponents claim? This article by Christine Fleming, Eric Wunder, and Susan Forray offers some perspective.

This article was originally published in Inside Medical Liability, First Quarter 2014.