Malpractice rate hikes paint ugly picture

April 1, 2006

The explanations for malpractice premium surges vary from an increasing number of lawsuits to falling profits from stock investments.

For more than 30 years, emergency physician and lawyer Hugh F. Hill III, M.D., and dermatologist Sandra I. Read, M.D., have been discussing that issue. Now, the Washington-area husband and wife team have developed information they share at American Academy of Dermatology meetings to make dermatologists aware of the issues that may be contributing to a growing malpractice crisis in their specialty. Dermatology has been comparatively fortunate during times of malpractice price hikes in the past few decades. This last round of premium increases may have signaled an end to that enviable status, however. Many dermatologists are wondering how to keep their costs under control.

According to Dr. Hill, "It just felt that the premiums were disproportionately raised. Dermatology was pulled up by other specialties, and malpractice insurance has become a bigger problem than before."

Searching for the roots

The problem is that very little information is available on what conditions or procedures are generating the lawsuits.

Records are kept as proprietary information by insurance companies to help them set rates. Dr. Read credits her work on risk management for the National Capital Reciprocal Insurance Co./NCRIC, Washington, with providing access to data from the Physician Insurers Association of America (PIAA) on dermatology claims from a 16-year period from 1985 to 2001. Combining that with information gleaned by Dr. Hill from legal databases, the two have amassed statistics they hope will help dermatologists understand where the increased costs are coming from.

Dr. Read says, "For years we assumed the only real condition dermatologists had to be concerned about was melanoma - that if you were careful about your documentation and the way you handled the follow-up, that was all you really had to worry about."

The doctors found, however, that a range of ailments and procedures are associated with the malpractice claims. Topping the list is malignant neoplasm - not including melanoma - but rather basal cell and squamous cell carcinomas.

Neoplasms at the front

Dr. Read says that upon reflection, it makes sense that the neoplasms generate a high volume of claims.

"In America, we get a million new cases of skin cancer a year - of those, 600,000 are basal cell and maybe 200,000 are squamous cell, with the rest being melanoma. There are a lot more malignant neoplasms than melanoma, so it's logical they generate more claims."

Numbers also explain why acne is the No. 2 producer of claims. "We see a lot of acne patients," Dr. Read explains simply.

Those conditions may generate claims, but patients also file malpractice allegations based on procedures dermatologists perform. The problem is that in the record-keeping, the procedures are not connected to the conditions.

Surgical errors - or nothing at all

"The most common procedural error," Dr. Read says, "is improper performance of operative procedures on the skin - basically the patient alleges the doctor didn't do an operation correctly.

"The problem is we don't know what conditions require the surgery. It can be an excision, a biopsy, perhaps even acne surgery, who knows? Maybe it left scars or discolored the skin."