Medical malpractice insurance is a requirement for any kind of practice, but it can also have a massive impact on your earning potential. Many things can affect your insurance rates, including your specialty and type of practice. One of the biggest factors is where you live, since insurers use state averages to help calculate your rates. Here are the best and worst states for malpractice insurance as of 2016.
The Most Expensive
Perhaps unsurprisingly, higher medical malpractice rates tend to occur in states with patient-friendly laws and high populations. New York has some of the highest malpractice rates in the country, and it also has some of the highest award payouts in malpractice lawsuits. Michigan, Illinois and Washington, D.C. are also near the top. West Virginia rounds out the worst five states, although its low population and largely rural atmosphere make it an outlier. However, West Virginia juries have historically favored the plaintiff and awarded payouts more than most other states, which inflates insurance premiums.
The Least Expensive
The most affordable states for medical malpractice insurance tend to be located in the Midwest. Wisconsin tops the list, while Minnesota follows closely behind. Surprisingly, Minnesota has very few laws limiting malpractice lawsuits, but patients seem less inclined to sue than in other states. Kansas, Indiana and Iowa complete the top five most affordable states. These states tend to have some degree of tort reform designed to keep malpractice insurance affordable, but a general culture of avoiding litigation and a history of juries awarding reasonable payouts may play a bigger role.
Other Factors to Consider
While the cost of malpractice insurance can significantly affect lifetime earnings, there can be other important factors. States such as Mississippi and Idaho may not have the lowest insurance rates in the country, but high wages combined with a low cost of living can offset the high premiums. Low competition can also provide job security and create a better working environment, since you can choose one that fits your preferences. In addition, evolving legislation may cause some states to improve significantly. Many states with high malpractice insurance premiums are passing laws to help limit costs, but the repercussions of tort reform legislation may take years to appear.
Although medical malpractice rates vary over time, most states have a general tendency to be low or high. Even increased tort reform may not be enough to help some states with high rates, which can make it difficult to make a living in them. While medical malpractice premiums alone may not be reason to pack up and move to a new state, they may help shape the course of your career.