According to an article in the April property/casualty edition of Best's Review, alternative medicine currently accounts for less than 5% of total medical malpractice writings and is serviced by fewer than 50 medical malpractice insurers. However, the article continues, insurers that cover medical malpractice risk are positioning themselves to take advantage of this market's expected growth. At least six malpractice carriers over the past two years have expanded or initiated plans to expand in the alternative health market.
This heightened interest in alternative medicine parallels increased attention from health insurers. Several high-profile health plans, led by Oxford Health Plans Inc. of Norwalk, Conn., recently have begun reimbursing clients for the costs of certain alternative treatments.
Also making alternative medicine attractive to malpractice insurers is the continued soft market for traditional medical clients. In a medical malpractice report released in December 1996, A.M. Best Co. analysts predicted that operating profit margins will remain strained in 1997 because of increasing competition. Indeed, insurers writing malpractice coverage in the alternative practice line already say they are beginning to feel competition.
Another driving force behind alternative medicine's malpractice insurance potential is the trend of alternative treatments being rendered in group practice settings, typically the exclusive province of traditional health-care providers. These groups often require all providers to carry malpractice insurance.
Best's Review is a monthly magazine published by insurance rating and information source A.M. Best Co. Members of the media can obtain a copy of this article in its entirety by calling Jeffrey Dunsavage at (908) 439-2200, ext. 5618.
A.M. Best Co., established in 1899, is America's oldest and most widely recognized insurance rating and information source.
CONTACT: Jeffrey Dunsavage | (908) 439-2200, ext. 5618 | http:\\www.ambest.com
[Copyright 1997, Business Wire]