News Release

Texans for Public Justice  ** 609 W. 18th Street, Suite E, ** Austin, TX 78701
For Release: 
April 5, 2002 
Contact: Craig McDonald

Gov. Perry Misdiagnoses
Causes of Doctors’ Insurance Woes

Misdiagnosis Prompts Prescriptions That Would Harm Patients

Austin, TX: Some of Governor Perry’s policy prescriptions to rein in the rising rates that doctors pay for medical malpractice insurance would harm the very patients whom they are supposed to help, an Austin-based consumer watchdog organization said today.

“The governor should get a second opinion before he swallows the misdiagnoses that are being spoon fed to him by the medical and tort lobbies,” said Texans for Public Justice Director Craig McDonald. “The contention that ‘runaway’ jury awards and  ‘frivolous’ lawsuits have forced reluctant insurance companies to hike their medical malpractice rates has not been independently substantiated. Governor Perry is falling for the same-old legislate-by-anecdote campaign that the tort lobby always uses to justify its attacks on consumer rights.”

The Governor’s plan to cap medical malpractice awards, regulate plaintiff attorneys’ fees, grant legal immunity to certain physicians and even create special medical malpractice tribunals will benefit insurers and—to a lesser degree—doctors at the expense of consumers. If the governor really wants to benefit consumers, he will have to concentrate more aggressively on his proposals for the state to collect better data on malpractice insurance rates and to play a role in insuring certain health-care providers.

The Governor’s sudden plan came in direct response to the walkout that Citizens Against Lawsuit Abuse (CALA) and some Rio Grande Valley physicians have scheduled Monday to protest their claim that frivolous lawsuits are inflating malpractice insurance rates and driving doctors out of that area. Contrary to these claims, State Board of Medical Examiners data demonstrate that the number of doctors in the Rio Grande Valley has increased 20 percent in the past four years from 825 to 1,034 physicians.

“Fortunately, the evidence shows that medical malpractice claims and pay outs are not increasing at the alarming rates that CALA and the Governor would lead us to believe,” McDonald said. “Doctors should join consumers to demand that the state stop insurers from price gouging across the board—in the auto, home and health insurance markets. Abandoning patients and abolishing their rights is a reckless prescription for affordable insurance.”

As in the mid-1980s, the insurance industry priced its liability policies relatively low during the 1990’s stock market bubble to maximize the revenues that it could reinvest on Wall Street. Now that the bubble has burst, this cash-strapped industry seeks to blame the civil justice system for its own management failures.

Arguing that the facts do not bear out sensationalist claims, McDonald called upon the Governor to make Texas insurers fully disclose the basis of all premium-hike requests. Facts that the Governor and CALA have chosen to ignore include:


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Texans for Public Justice is a non-partisan research and advocacy organization that works for
 corporate and political accountability on behalf of Texas consumers.

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