Insurance Rates Called a Peril to Obstetric Care

The rising cost and shrinking availability of malpractice insurance is causing health professionals to leave obstetrical practice and may sharply curtail medical services for pregnant women in California, several physicians and a nurse-midwife predicted Tuesday.

In testimony before a state Senate committee in Los Angeles, Dr. Jane Murray of the California Academy of Family Practitioners forecast that within one to two years no family physicians will be delivering babies in the state. She said the impact would be most severe in rural and inner-city areas.

Rosemary Mann, a nurse-midwife from Stanford University, said her profession is in a “critical state” because nurse-midwives who practice alone or in rural areas will not be able to obtain insurance in the future.

Their testimony, reflecting a national trend, was given at a Senate Committee on Health and Human Services hearing on malpractice insurance and obstetric care held at Patriotic Hall Auditorium.

The hearing was called after the committee’s staff heard reports about inadequate obstetric services for Medi-Cal patients in Lancaster, and after the office of the committee chairwoman, Sen. Diane Watson (D-Los Angeles), began to receive frequent complaints about doctors who either were no longer delivering babies or had raised their rates.

Dr. Robert Smith of the American College of Obstetricians and Gynecologists said the average malpractice premium for obstetricians in the nation and for California had increased by nearly $10,000 in the last two years and is now $20,800. He said one in eight obstetricians now pays $35,000 or more.

Smith said 12% of college members surveyed nationwide earlier this year had stopped practicing obstetrics and 23% had reduced their participation in cases in which complications for the mother or infant were likely to arise.

Smith said it is particularly distressing that an apparent crisis is developing at this time. “The birth process is not a universally successful event, but (birth complications and death) have never been lower and the chances of having a healthy baby have never been higher,” he said.

Dr. John Whitelaw of Sacramento, representing the California Medical Assn., cited a survey completed earlier this year showing that about 25% of the physicians who delivered babies had either stopped or were considering stopping. About 40% of those in rural and semi-urban areas said their patients would have difficulty securing adequate alternative sources of care.

A typical private physician’s fee for complete prenatal care and delivery is between $1,400 and $2,200, according to Dr. William Rosenzweig, who testified for the California Assn. of Obstetricians and Gynecologists. By comparison, he said that Medi-Cal would reimburse only about $500 and many prepaid or group health plans pay only about $1,200.

If a physician paid $20,000 for malpractice insurance and delivered 100 babies a year, the insurance cost for each delivery would be $200. Thus, many obstetricians have cut back services for Medi-Cal patients in particular, according to Rosenzweig. More than 100,000 mothers receive Medi-Cal assistance each year for pregnancy care, according to the medical association.

Based on Study

The forecast that family practitioners will give up obstetrics entirely is based on a study just completed by Dr. Sanford Bloom of Santa Monica Hospital for the California Institute of Family Medicine.

“The overwhelming response was to stop the practice of obstetrics if projected malpractice increases continue,” Bloom said in a telephone interview.

Family practitioners often devote only a percentage of their practice to pregnancy care but are assessed malpractice fees comparable to those of a full-time obstetrician. Bloom said 1986 rates for family doctors who did only low-risk deliveries were projected by one major insurer at nearly $20,000.

Stanford’s Mann pointed out that the average annual income of the state’s 450 nurse-midwives, who perform less complicated deliveries with physician backup, is about $28,000. In the past, they have been able to obtain up to $1 million in coverage for less than $50 a year, but such policies have either been canceled or will cease by the end of 1986.

Effect on Self-Employed

While 70% of nurse-midwives are insured through their employers, such as health maintenance organizations or county governments, those who are self-employed or not eligible for employer-paid insurance “may not be able to continue,” Mann said.

In 1984, there were about 450,000 births in California, according to state health department statistics. About 40,000 births are attended by family physicians and family medicine residents, according to Bloom. Between 50,000 and 70,000 births are attended by nurse-midwives, according to Mann. The rest are handled by obstetricians.

In 1982, according to the most recent medical association survey, there were 3,463 obstetricians in California and 7,644 general and family practitioners. Bloom estimated that 25% to 40% of the family physicians trained in residency programs deliver babies.