Could Precision Medicine Potentially Justify a Lower Medical Liability Premium Over Time?

A few years ago, I suddenly noticed a substantial increase in the rate of my auto insurance policy. It prompted me to call my insurer to get clarification. They explained that the spike was proportional to the rising number of automobile accidents in my area, an astounding 30% surge.

In May 2023, the American Medical Association (AMA) published an article titled "Medical liability premium hikes continue for 4th straight year." The article made me wonder if there was a correlation between the premium hikes and a growing number in claims. I started digging into the causes. In 2023, the AMA also published a "Policy Research Perspectives." In this research, it was mentioned that "according to some actuaries, insurers started raising premiums in response to deteriorating underwriting results, lower loss reserve margins, and lower returns on investment." I sought for the opinion of an independent insurance practice specializing in medical professional liability insurance. Medpli published a blog in early 2023 mentioning "key factors in the current malpractice litigation landscape that play a role in driving premium rates higher:

1. Severity of claims with larger payouts

2. Rising cost of legal fees

3. Economic inflation"

The blog also stated that "increasing premiums across the board for all policies is the typical way carriers protect themselves against unexpected significant losses so that they can ensure coverage for everyone. However, avoiding medical malpractice lawsuits is the best way to potentially avoid an exceptionally high premium increase." It also provided insights on how to reduce malpractice risk to potentially reduce costs by taking "proactive steps to improve communication with patients" and raising "the level of surgical excellence in your [medical] practice." The emphasis on the words "proactive" and "excellence" stuck with me as to how they relate to precision medicine. Proactive genetic screening for potential hereditary risks and diseases improves recovery outcomes. The use of pharmacogenomics optimizes cure efficiencies in many cases. Having augmented capabilities to unify these pillars of precision medicine will decrease instances of negative patient outcomes, resulting in less liability insurance claims, thus stabilizing the premium costs of such policies.

In the past twenty years, I have met many physicians who have stopped practicing medicine because of the rising cost of their medical liability insurance. Newcomers in the field are already lamenting about the outlook of their heavy investment in their insurance premiums. It's clear something has to be done to stabilize the continually rising cost of medical liability insurance. The AMA stipulated that "if current trends continue, even if slower and less severe than the last hard market, this medical liability pressure could have detrimental effects on health care markets, such as an increase in defensive medicine, lower physician supply, and thus reduced access to care."