Dr. Thomas McNamee, an OB/GYN from Waterbury, CT has practiced 22 years without a malpractice judgement against him. That's why last week he aligned with the state's Trial Lawyers Association to encourage the state's Insurance Commissioner, Susan Cogswell, to hold a hearing to review GE Medical Protective's (his insurance carrier) recent 89.6 percent rate increase. Bridgeport lawyer and CTLA President Richard Newman as well as heads of two consumer groups: Connecticut Patients' Rights Group and Healthcare for All Coalition joined Dr. McNamee's signature on the letter to Cogswell. Accompanying the letter was a five-page analysis of GE Med Pro's Feb. filing with the commissioner's office in support of a July 1 rate increase.
As a result of the complaint letter, the director of the state's property and casualty division wrote back promising a review. The state office also forwarded the analysis to GE Med Pro requesting a response within two weeks.
Within the analysis conducted by Allan Schwartz, an actuary and president of AIS Risk Consultants hired by the lawyers' group, he concludes between 2000-03, of the $4.6 million in "losses" GE Medical Protective reported to the state, it paid out just $200,000 in claims, set aside another $400,000 in reserves for cases pending and held $4million in reserves for losses "incurred but not reported," that is, actuarial estimates of what its total losses for the period might be.
Schwartz says, meanwhile, during the same period, the company reported $13.9 million in eared premiums and an operating profit of $6.8 million, for a margin of almost 50 percent. According to Schwartz, a 10 percent margin is "normal." He claims even before the rate increase, the insurance company was making a profit five times what would be "normal".