My wife is an OB and has to pay $140,000/yr per year for tail insurance in my state. So she literally needs to make, after all other costs of the practice, $140k just to break an even $0/yr.
And people wonder why it costs so much to have a baby.
I can't imagine (but do not know) that it is more efficient to pay claims-made AND tail, versus claims-made with prior acts (unless of course your employer is paying the claims-made).
For those not in the medical field, tail or ERP (extended reporting period) coverage is liability coverage for when the original policy has ended - i.e. you were insured for 2024, but in 2025 a malpractice suit comes to you for an incident in 2024. In the auto/general world, this is fairly well accommodated, but in the medical liability world, insurers say it is because of the preponderance of claims that may arrive significantly later than coverage.
However, many insurers absolutely ream providers on it. Tail insurance is typically double the actual claim premium, i.e. insurers are saying that your insurance premium is only covering 1/3 of the claims they expect to pay on your behalf. I ... have doubts ... on that number. And I also suspect that there is a bell curve happening where certainly, complex malpractice claims may take time to be built out and filed, and that may extend beyond coverage, but then at a certain point, you can relatively confidently assume that the incoming claims are asymptotically approaching zero.
Additionally, I cannot exactly remember if malpractice insurers are required to abide by MLR - profit restrictions - like the 80/20 rule, but in your wife's case, the insurers as a whole (claims-made and tail) are implying that they expect to pay out $168,000 a year for her liability.
(Sure, charging precisely for risk would just result in some patients/scenarios being avoided, but per case or a percentage of billing would make much more sense).
Mid career, she should only expect to pay about $120k/yr…
Someone who does one vaginal delivery a month is not going to be as good at doing them as someone who does two or three a day. And they certainly won't be as good at cesarean sections. Delivering just one baby costs a hell of a lot of money in insurance, which is a major part of why family doctors in rural areas don't do that anymore.
By contrast, people who drive more miles - even if they are excellent drivers - are at higher risk of being in a collision because they have to deal with other people on the road, who may be terrible drivers.
There are patients that make a living going around doctor offices and suing them. I know 1 patient in particular that went around suing doctor offices because they would not cater to his blindness. He would threaten a lawsuit without setting a foot in the doctor's office.
He would browse the doctor's website and complain it was not blind-compliant. And start from there.
Why assume the problem is the legal system and not the doctors? Maybe their performance is the problem.
For example, last I saw, hospital error was a leading cause of death in the US. Until recently it was hard to get doctors to wash their hands between patients, or follow checklists to ensure quality. There are stories of an omerta-like rule of silence about surgical errors.
Try shopping around insurance or go with a mutual, or perhaps go with a IPA ?
NOTE: This rate is CERTAINLY valid if the OB has a long track record of attracting litigation. All insurers will ask for your "run rate" of claims. So, you can't escape a bad record. If you have a history, insurers will charge accordingly. You can't escape a poor record.
This is OB in the state of Illinois, it’s roughly the same cost ans all of the other OBs we’ve talked to here. She doesn’t have a litigation history at all yet.
I've seen many Northeast, more expensive states quotes, and West coast. I do not know about IL. So if theres some kind of special racket there, i could be ignorant of that.
No surgery. No facility /ASC . Straight up MD offices with FT coverage for malpractice.
I feel like you're conflating 2 separate issues:
1. You are correct, one of the biggest concerns for physicians is malpractice risk, and thus a big draw for physicians (especially in high risk specialties) is states that have low caps on max malpractice damage awards. I'd say there is a tendency of red states to have lower caps, but it's really a mix. E.g. Texas has some of the lowest malpractice caps, while Wyoming has a constitutional provision prohibiting caps.
2. When it comes to the risk of obgyns, the main fear is not really the cost of malpractice, but it's simply that extremely restrictive abortion laws make it impossible to give proper care. Lots of people, and politicians especially, like to see the world in absolute black and white, but obgyns know more than anyone else that there are a whole host of issues that can cause a fetus to be nonviable, or dangerous to the mother, and laws that protect the fetus above all else are not rationale. Obgyns can fall anywhere on the political spectrum just like the populace at large, and there are plenty of conservative obgyns who are against abortion for moral or religious reasons, but they also know the realities of pregnancy and that many of these laws are simply unworkable.
It doesn't matter that some states have caps on malpractice payouts. That's only half the matter. It's the number of times that a doctor has to be sued FOR malpractice, because a lot of those costs are going to be attorney fees. If I were a lawyer in Texas, I'd be posting billboards about specializing in suing doctors for not providing care. When women realize they can win a windfall in court for being denied care with life threatening conditions, they're going to start suing. And winning. Juries love giving away insurance company money.
More suits, higher premiums. Since that risk is spread across the state, so is the insurance rate. Most conservative OBs still understand, know, and respect the science. If Texas or Idaho or Alabama gets too expensive, especially given how absolutely garbage the standard of living is in those states, they're gonna haul ass political affiliation be damned.
This is a fantasy, it has never happened, and it's fundamentally not how the law works. Show a single instance where a doctor has been sued for refusing to give care due to risk of running afoul of restrictive abortion laws.
Where's all this noise about a regulatory stance causing malpractice lawsuits to skyrocket ?