Following coincidentally upon the heels of our last issue in which Betsy McCaughey and Anthony Bonomo, President of PRI, expressed their advocacy for reforms in the health care sphere—as the Baucus Bill advances—the Casualty Actuarial Society reported the results of the panel at its recent casualty loss reserve seminar. Observing that the frequency and severity of claims in the medical malpractice sphere is experiencing only a moderate increase, Christian Coleianne, Associate Director and Actuary, at Aon Risk Consultants, Inc., said that the environment in hospital professional liability seems relatively stable. This is good news for the insurance industry and even better news for the medical profession as it demonstrates that the identification of what are termed “never events” and the attack on hospital liability problems actually works. The so called “never events” are hospital acquired conditions that are completely preventable and should never occur, for example: pressure ulcers, injury, objects left in surgery and infection. These four things account for 12.2% of the total hospital professional liability cost according to Coleianne. One out of every six hospital professional liability claims is due to these four hospital acquired conditions; there are 24 others in this category as well. While we do not believe that medical malpractice reform and control of lawsuits alone i.e. tort reform, provide the Rosetta Stone for all other health insurance reforms, it is a critical point since it reflects a changing attitude toward malpractice and toward jury awards… We were pleased with the response we received, good and bad, to Ms. McCaughey and the almost universally favorable response we received to Mr. Bonomo’s opinion…On that note, the Insurance Advocate continues to receive very lively mail from its readers, some examples of which appear alongside this column and the Contents page. One letter is emblematic of many letters we received on producer compensation. There is a great deal of anger out there since the implication is, as we wrote in our last editorial, that there is some nefarious truth revealed by the positive disclosure of an agent’s compensation. A bold statement of the truth, of course, implies many things, including falsehoods, as we tried to demonstrate. Another sentiment is that agents should not be singled out among any other providers for the disclosure of their earnings or the format of those earnings. One imagines in the current healthcare debate that doctors might be required to disclose their annual net earnings to their patients as some form of index of their quality. This was among several suggestions and letters we received. Thank you all for your continued responsiveness and attention to the Insurance Advocate…We have lost one long time faithful friend (and avid reader) recently and that is D. Stan Landberg, about whom you may read on a separate page. We have known Stan for many years as an active supporter of agents, of this industry and of this magazine. He was a great friend and we will miss him sorely… In this issue we present a Q & A with Ed McGettigan, who has to be one of the most upbeat people I have ever interviewed. He is running a very interesting and growth oriented enterprise…Same for Jeff Baker, MedSave USA’s quarterback, which discovered the unique, cost saving space in which it is a leader…It is interesting to note that these enterprises employ about 600 people and use the services of many law firms and outside suppliers. They are two small companies relative to some of the giants in and around New York State and New Jersey. These smaller, entrepreneurial driven companies form a great piece of the economic fabric of our state and can not be and must not be underestimated. Insurers provide hundreds of thousands of jobs in the tri-state area; from the smallest brokerage in rural upstate New York, to the multi-floor high risers on Avenue of the Americas in New York City. It’s a great argument for associations to make, to undergird the power and impact of the insurance industry. Of course a better argument to make is how the industry works so hard to control costs in ways reflected in many places in this publication, and never gets the credit…In recent weeks we have been involved in discussions of mergers and acquisitions including some enterprises advertised in these pages. It is interesting to see that there is capital coming back into the market and that individuals are willing to take small gambles where, a year ago, they were not. We believe that following belt tightening and careful budgeting, there is capital freed up through good business practice. An era of expansion was followed by an era of contraction and now we are going back up again a little bit in ways that will affect the economy favorably. I would like to describe it as Dick Morris did the other night at a speech he gave in New York City which I was quite pleased to attend. Morris said “Our economy is not shaped like an “L” - down and out, or like a “V”, down and up, but more like a W - down, up a little, down a little, and then all the way up again.” Let’s pray Dick is right.