New Jersey State Bar Association - The voluntary Bar Association of New Jersey, serving members since 1899.

FOR IMMEDIATE RELEASE: 07/01/04
CONTACT:Barbara S. Straczynski
Communications and Marketing Manager
732-937-7524

Letter to Governor McGreevey on Repeal of Medical Malpractice Liability Insurance Premium Assistance Fund

July 1, 2004

Honorable James E. McGreevey

Office of the Governor

P.O. Box 001

Trenton, NJ 08625-0001

RE: Medical Malpractice Insurance Industry Representations and P.L. 2004, c. 17

Dear Governor McGreevey:

On behalf of the New Jersey State Bar Association (NJSBA), I call upon you to support the repeal of Section 27 of P.L. 2002, c. 17 known as the "New Jersey Medical Care Access and Responsibility and Patients First Act" which establishes a Medical Malpractice Liability Insurance Premium Assistance Fund, and to investigate the integrity of information provided by medical malpractice insurance companies.

As we expressed in our letters to you and the Legislature, and as has been confirmed by the recently released information of the Division of Consumer Affairs, the so-called crisis in medical malpractice ignores the facts.

Lawyers have been unfairly assessed for doing their job and protecting legitimate victims of medical malpractice. Despite claims to the contrary by medical malpractice insurance representatives to the Legislature, the recently released information reveals that pay-outs on medical malpractice insurance claims have actually decreased over the past two years. This aligns with statistics previously released by the New Jersey Administrative Office of the Courts, showing a decline in medical malpractice cases filed over the past six years. Both reports show a recent and steady decline in medical malpractice pay-outs and cases, which is consistent with previously enacted laws aimed at curbing medical malpractice lawsuits.

This new information further demonstrates the compelling need for a complete study of the medical malpractice insurance system, as the NJSBA has advocated for the past three years. Such a study must get to the root cause or causes of escalating medical malpractice insurance premiums including medical malpractice prevention and a thorough examination of medical malpractice insurance companies.

Furthermore, the Division's statistics call into question the need for the recently established Medical Malpractice Liability Insurance Premium Assistance Fund (the "Fund") paid for by assessments on various medical and legal professionals. In addition, businesses must also contribute to the Fund, resulting in a trickle-down effect, with an assessment on every employee in New Jersey. Not only will doctors be the beneficiaries of the Fund, but most significantly, so will medical malpractice insurance companies, including some that have doctors as primary stockholders. Given the medical malpractice insurance companies' dubious candor and remarkable silence during legislative hearings and public debate on this important issue, the legitimacy of the Fund is even more questionable than we initially asserted.

Based upon the aforementioned concerns, the New Jersey State Bar Association calls upon you and the Attorney General to, with all due speed, refer this matter to the appropriate authority for a comprehensive investigation into the integrity of the information provided to the Legislature and the Department of Banking and Insurance by medical malpractice insurance companies. Furthermore, the Association calls for the repeal of those portions of the "New Jersey Medical Care Access and Responsibility and Patients First Act" that established the Fund until such time as a genuine need for such a fund can be adequately demonstrated.

For your information, we are sending a similar letter to the Legislature on a bipartisan basis in order to rectify this unfair statute.

Please contact me if you have any questions or comments in this regard.

Very truly yours,

EDWIN J. MCREEDY, ESQ.

President, New Jersey State Bar Association