Dollar Woes Drive Docs Away

Malpractice Insurance
Doctors say they're being driven out of Philadelphia.

"It's a nice place to live but a horrible place to work," orthopedic surgeon Larry Miller told CBS News Correspondent Mika Brzezinski. He now commutes to a new office in New Jersey.

"I bailed out," he said.

Dr Nick Dinubile, who lost six partners to other states, said, "They're going all over the country, anywhere but here."

OB-GYN Dr. Nancy Roberts decided to stay, but no longer delivers babies in the city. "This is an absolute crisis," she complained.

The reason? Malpractice insurance costs in this state are some of the highest in the nation. Premiums are so expensive that doctors are fleeing Pennsylvania and specialists are the first to go.

Dr. Roberts is currently paying about $22,000 in malpractice premiums. If she were still delivering babies, she would pay $105,000 - annually.

In the past year, malpractice premiums jumped 40 percent in Pennsylvania - compared to 15 percent nationwide.

And Pennsylvania, with about 4 percent of the nation's population, pays out 10 percent of the nation's malpractice awards.

Doctors there want what 18 other states have - caps on malpractice settlements that they say bring insurance costs down.

But in a bid to keep some disgruntled doctors from walking off the job Wednesday, Pennsylvania Gov.-elect Ed Rendell unveiled a proposal to cut physician payments to a state malpractice insurance fund by two-thirds.

Under the plan, the state's health insurers would be forced to pay a one-time "special assessment" to finance the fund in lieu of the doctors' payments. It would cut physician contributions to the MCare fund by $220 million. Some doctors' contributions would be eliminated, others would see their bills cut in half, depending on their area of practice.

"You're not going to have a reduction of rates in insurance just because you have caps," said malpractice attorney Tom Kline.

He blames the economy and fewer insurers for the rate increases. His firm won a $49 million dollar malpractice award, and says all victims should have the right to sue bad doctors for as much money as possible.

"The problem is not going to be solved fairly on the backs of people who deserve to be compensated when horrible mistakes are made," Kline explained.

But doctors like Nancy Roberts say what's unfair is the current situation. - she's now priced out of her own specialty.

"With our increase in malpractice premiums I actually was losing about $500 every time I delivered a baby!" she told Brzezinski.

Dr. Miller was even more pessimistic. "If this continues, we are going to destroy the industry of medicine," he said.

Kline disagrees. "Those are scare tactics," he said. "Those are pure and simply scare tactics that you're not going to find a doctor."

They do agree that malpractice insurance is too high. The question is, will a solution be found before the state loses its finest physicians?