Sunday, May 7, 2006
Increased claims costs are the primary driver of premium rate increases.
Tort reforms decrease claims costs and, in turn, premiums for physicians.
There is no evidence that anticompetitive behavior, weak regulation, insurer investment decisions, or other features of capital markets are important contributors to rising premiums.
So far as I can tell, the study does not evaluate whether the claims costs that were eliminated were for "frivolous" claims, or indeed evaluate the nature of the claims costs reduced at all. (That's not a criticism of the study; it's not what he was asked to do.)