Citing the effects of statewide tort reform, two medical malpractice insurance carriers plan to reduce their rates -- one of them up to 30 percent-for roughly 3,500 Texas physicians.

The decisions by the Doctors Co. of Napa, Calif., and American Physicians Insurance Exchange of Austin come on the heels of rate reductions from the state's largest malpractice underwriter.

And it comes as competitoin in the market -- which two years ago was so hobbled that a Texas obstretrician or neurosurgeon was lucky to even get insurance -- is starting to heat up.

"This is a very positive trend," said Jim Hurley, a spokesman for the Texas Department of Insurance. " Existing companies are expanding their writings, and
we have new companies starting up. More and more people are seeing the Texas market as a good place to write malpractice insurance."

But while a few would dispute that the rate reductions, to take effect between May and June, are good for doctors and consumers, they differ on just how significant the recent trend is.

"It's too little, too late," said Alex Winslow, executive director of Texas Watch, a nonpartisan nonprofit group that monitors insurance. Not all carriers are reducing rates, he said, and those that are had raised rates so much in previous years that
the reductions don't make up for it.

Average 14% reduction

Specially, the Doctors Co. is trimming rates between 5 percent and 30 percent, or an average of about 14 percent, for most of the 1,300 doctors it insures, Chief Executive Richard Anderson said.

Between 1999 and 2003, however, the company raised rates an average of 101.5 percent, according to the Texas Department of Insurance.

Likewise, American Physicians said is was dropping its rates an average of 5 precent for about 2,200 of the obstetricians, surgeons and other doctors it insures, company President Maury Magids said.

But that compares with an estimated 85 percent average increase from 1999 to 2003, Magids said.

The state's largest malpractice underwriter, TexasMedical Liability Trust, which insurers about 11,000 doctors, dropped its rates 16.4 percent in 2004, Hurley said. But from 1999 to 2003 it raised them an average of 147.6 percent.

The big rate increases were prompted in large part by high civil jury awards and an increase in malpractice claims and lawsuits. Many carriers left Texasaltogether. In 1999, 17 companies were writing new medical malpractice policies in Texas. That number slid to four in 2002, according to the department of insurance.

The malpractice insurance crisis in large part also fueled the push for tort reform, or Proposition 12, which took effect in September 2003. Among other provisions, the law included a $250,000 cap on noneconomic damages.

Many see stability. Advocates of tort reform said the law would restore stability to the medical malpractice insurance market and promote competition. Many say it has.

"In the years before tort reform, we went from bad to worse to unprecedentedly awful," Anderson said. "We do believe that some degree of sanity has returned to the medical jurisprudence system in Texas. and it that is the case, our rates will continue to come down."

Magids said American Physicians has seen a dramatic decline in claims since tort reform went into effect. He added thta the influx of new carriers in Texas -- 15 have entered the market or soon will, according to the department of insurance -- has created a competitive market that can only benefit doctors and their patients.

In all, 39 entities are now writing medical malpractice insurance policies in Tesxas, according the department.

The increased competition may be one reason why another large carrier may soon be allowed to increase its rates.

The state's second-largest malpractice insurer, G.E. Medical Protective Co., known as MedPro, filed in April for a 19 percent rate increase, but that was rejected by the department of insurance after regulators deemed it excessive. MedPro then reorganized its Texas physicians into aso-called "risk purchasing group," which uses group purchasing power to buy insurance and is not subject to rate regulation, and implemented a 10 percent rate increase.

The insurance department asked an administrative law judge to block that move and stop the rate increase.But the judge ruled there was enough competition inthe market to let MedPro set its own rates. A ruling by the state insurance commissioner is pending.

Like many of his collegues, Houston obstetrician John Irwin, who is insured by American Physicians, said he welcomes the rate reductions. But heÕs still reeling from the years of increases.

"It's improving, but I don't think it will ever get back to where it was, not in my lifetime," he said.

Doctors coming back

Robert Vanzant, a family practitioner and president of the Harris County Medical Society, said that during the malpractice crisis many doctors who practiced in high-risk areas -- such as obstetrics -- closed their doors because they could no longer afford insurance. That's slowly changing, he sad.

"I think this is having a positive effect, and I think patients will reap the benefits of this because they are going to see doctors getting back into high-risk practices," he said.

But Winslow of Texas Watch said consumers, while perhaps having more access to health care, have little hope of justice if they are victims of malpractice because of the damages cap.

"No matter how low rates go, if cannot justify the inability of medical malpractice victims to get recourse," he said.