Reply #14: Here is the article I was looking for

[nothingshocksmeanymore]

MICRA did not lower insurance premiums in California
During the insurance crisis of the 1980s, California's 1975 law restricting the right of injured patients to sue doctors, hospitals and HMOs for medical mistakes and negligence was touted by the insurance industry and medical industry as a model "tort reform" for the nation. Doctors were told that the skyrocketing premiums they must pay to purchase malpractice insurance coverage would be reduced if MICRA-type laws were enacted.

Studies conducted during and after the 1980s "crisis" told a different story. The U.S. General Accounting Office, published a study of six states that had enacted many different forms of tort law restrictions during the "crisis" of the mid-1970s, including caps on compensation. The GAO report showed that the price of medical malpractice liability insurance in California had increased dramatically since the passage of MICRA. In fact, "premiums for physicians increased from 16 to 337 percent in southern California ... between 1980 and 1986."1 The GAO study concluded:

While it is not possible to assess the extent to which the act has had an impact on the state's malpractice situation, our analysis of key indicators indicated that the problem is continuing to worsen in California.2

According to the GAO, four states (Arkansas, Florida, New York and North Carolina) reported that the restrictions had had "little effect" on insurance premiums.3

A later, comprehensive review of insurance industry data spanning the period from 1976, when MICRA took effect, through 1991, demonstrated that its restrictions did nothing to ease the cost of malpractice insurance premiums. The average malpractice premium per California physician was higher than the national average in most years after MICRA's passage. The total cost of malpractice liability insurance premiums paid as a percentage of total health care costs was higher in California than in the nation. Moreover, the price of malpractice coverage increased in California after the passage of the law. Premiums grew 191 percent through 1988, when they began to fall, dropping 20 percent by 1991. The same pattern emerged in the nation: premiums grew 331 percent through 1989, then fell 5 percent by 1991.4

http://www.consumerwatchdog.org/insurance/fs/fs002695.php3