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ISMIE portrayed this ruling as somewhat of a victory yesterday, claiming that the state had essentially upheld its prior rates. The other side is also claiming victory, however.
Using a new law designed to lower doctors’ costs, state regulators on Tuesday ordered Illinois’ major malpractice insurer to start bringing down rates next year and open itself to more public scrutiny.ISMIE Mutual Insurance Co. criticized the order as a bad precedent that will interfere with its day-to-day operations. But the Illinois Trial Lawyers Association said it suggests regulators have concerns about how the insurer sets rates.
The order comes as part of a new law meant to lower rapidly rising insurance rates that were forcing some Illinois doctors out of business. The law combines new limits on malpractice lawsuits with stronger state regulation of insurers and doctors.
The state Division of Insurance approved ISMIE’s proposal to keep its overall rates flat this year after large increases in recent years.
But the agency ordered the company to hold its rates steady next year, too, and aim to reduce them by 3.5 percent if that is financially feasible.
Insurance Director Michael McRaith also ordered ISMIE to give more money back to some doctors through dividends and education programs and to provide more information about how it devises its rates.
posted by Rich Miller
Wednesday, Mar 15, 06 @ 12:18 pm
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ISMIE is nothing more than a cash cow. Their recently filed annual statement showed 4 major things.
1) Premiums paid by docs is still high.
2) Money paid out to cover claims is still declining.
3) The average payout is declining.
4) Executive compensation is out of control.
The cap legislation was a joke. There needs to be an investigation at the highest levels.
Comment by Doctor Don Wednesday, Mar 15, 06 @ 1:19 pm
we will know the med mal crisis is getting better when there are other insurers moving into the state to give isme competition and doctors stop leaving the state. doctors are reluctant to move in not knowing the status of the legislation passed last year putting caps on settlements. if that law gets overturned by the supreme court in a few years, its back to square one. if isme was making so much money and the profits were so good would some other enterprising insurance company start operating in illinois to make a profit. the situation in madison and st clair county is still critical. doctors in that area have stated there are not enough doctors avalible to handle new patients. if the governors all kids program passed and was adequately funded doctors would not be able to see the kids, because of to few doctors.
Comment by ron Wednesday, Mar 15, 06 @ 2:24 pm
Ron -
Your logic is severely flawed. ISMIE has the lion’s share of business in Illinois for the same reason ComEd has the lion’s share of the utlity business in Chicago — the current system is designed to protect their monopoly.
How are outside insurer’s supposed to come into Illinois and compete when ISMIE has not only the State Medical Society but also many local chapters on it’s payroll?
And if times are so tight at ISMIE, how is it they manage to pay an $1,800 per diem to their board members? Board President Harold Janssen racked up nearly a quarter of a million dollars in per diem last year, that on top of a salary he collects.
Doctor Don is right, ISMIE IS a cash cow, and it’s the board members, executives, and their political buddies that are drinking all of the milk.
Sooner or later, doctors are going to get tired of being squeezed. Or maybe they just like complaining and playing the victim. I know one thing, it shouldn’t be my problem as a consumer.
Comment by Yellow Dog Democrat Wednesday, Mar 15, 06 @ 4:35 pm
yellow dog democrat
you have no understanding of basic economics. isme is the only game is town at this time, so yes they can act like a monoply. there is ablsolutely NO reason another insurer can not come into the state,except they are afraid of the exposure to lawsuits at this time. why would another insurer come into this state with the potential for the claims. by the way, check out our neighboring states with caps and you will see they have lwoer premiums and OTHER insurers. also, your example of a con ed is flawed, because they do have a monopolistic regulated control in the state. just think if you could go out and bid for electric and gas service from other provbiders. the lower cost most efficient provider would give you lower rates.
your liberal anti busienss philosphy is showing.
Comment by ron Thursday, Mar 16, 06 @ 8:40 am
By the way, ISMIE hasn’t taken new business in over three years because of their moratorium, so couldn’t other companies come into town and take current ISMIE doctors with lower prices and fight it out for the rest of the business? You know why they aren’t? It’s not a profitable business. It it was, insurance companies would be fighting to get into the state. YDD, you’re wrong on this one.
Comment by Wildcat Thursday, Mar 16, 06 @ 11:33 am