S1137B1621A06012 MSP:JSL 03/07/08 #90 A06012
AMENDMENTS TO SENATE BILL NO. 1137
Sponsor: REPRESENTATIVE WATSON
Printer's No. 1621
1 Amend Title, page 1, lines 15 through 22, by striking out
2 "further providing for medical" in line 15 and all of lines 16
3 through 22 and inserting
4 further providing for medical professional liability insurance,
5 for the Medical Care Availability and Reduction of Error Fund,
6 for the definition of "account," for abatement program, for
7 procedure, for certificate of retention, for the Health Care
8 Provider Retention Account and for expiration; and providing for
9 the Health Care Provider Retention Reserve Account.
10 Amend Bill, page 1, lines 25 and 26; pages 2 through 20,
11 lines 1 through 30; page 21, lines 1 through 10, by striking out
12 all of said lines on said pages and inserting
13 Section 1. Sections 711(d) and 712(c), (e) and (m) of the
14 act of March 20, 2002 (P.L.154, No.13), known as the Medical
15 Care Availability and Reduction of Error (Mcare) Act, are
16 amended to read:
17 Section 711. Medical professional liability insurance.
18 * * *
19 (d) Basic coverage limits.--A health care provider shall
20 insure or self-insure medical professional liability in
21 accordance with the following:
22 (1) For policies issued or renewed in the calendar year
23 2002, the basic insurance coverage shall be:
24 (i) $500,000 per occurrence or claim and $1,500,000
25 per annual aggregate for a health care provider who
26 conducts more than 50% of its health care business or
27 practice within this Commonwealth and that is not a
28 hospital.
29 (ii) $500,000 per occurrence or claim and $1,500,000
30 per annual aggregate for a health care provider who
31 conducts 50% or less of its health care business or
32 practice within this Commonwealth.
33 (iii) $500,000 per occurrence or claim and
34 $2,500,000 per annual aggregate for a hospital.
35 (2) For policies issued or renewed in the calendar years
36 2003, 2004 [and 2005], 2005, 2006 and 2007, the basic
37 insurance coverage shall be:
1 (i) $500,000 per occurrence or claim and $1,500,000 2 per annual aggregate for a participating health care 3 provider that is not a hospital. 4 (ii) $1,000,000 per occurrence or claim and 5 $3,000,000 per annual aggregate for a nonparticipating 6 health care provider. 7 (iii) $500,000 per occurrence or claim and 8 $2,500,000 per annual aggregate for a hospital. 9 (3) [Unless the commissioner finds pursuant to section 10 745(a) that additional basic insurance coverage capacity is 11 not available, for] For policies issued or renewed in 12 calendar year [2006 and each year thereafter subject to 13 paragraph (4)] 2008, the basic insurance coverage shall be: 14 (i) [$750,000] $550,000 per occurrence or claim and 15 $2,250,000 per annual aggregate for a participating 16 health care provider that is not a hospital. 17 (ii) $1,000,000 per occurrence or claim and 18 $3,000,000 per annual aggregate for a nonparticipating 19 health care provider. 20 (iii) [$750,000] $550,000 per occurrence or claim 21 and $3,750,000 per annual aggregate for a hospital. 22 [If the commissioner finds pursuant to section 745(a) that 23 additional basic insurance coverage capacity is not 24 available, the basic insurance coverage requirements shall 25 remain at the level required by paragraph (2); and the 26 commissioner shall conduct a study every two years until the 27 commissioner finds that additional basic insurance coverage 28 capacity is available, at which time the commissioner shall 29 increase the required basic insurance coverage in accordance 30 with this paragraph.] 31 (4) [Unless the commissioner finds pursuant to section 32 745(b) that additional basic insurance coverage capacity is 33 not available, for] For policies issued or renewed [three 34 years after the increase in coverage limits required by 35 paragraph (3)] in calendar year 2009 and for each year 36 thereafter, the basic insurance coverage shall be: 37 (i) [$1,000,000] $600,000 per occurrence or claim 38 and $3,000,000 per annual aggregate for a participating 39 health care provider that is not a hospital. 40 (ii) $1,000,000 per occurrence or claim and 41 $3,000,000 per annual aggregate for a nonparticipating 42 health care provider. 43 (iii) [$1,000,000] $600,000 per occurrence or claim 44 and $4,500,000 per annual aggregate for a hospital. 45 [If the commissioner finds pursuant to section 745(b) that 46 additional basic insurance coverage capacity is not 47 available, the basic insurance coverage requirements shall 48 remain at the level required by paragraph (3); and the 49 commissioner shall conduct a study every two years until the 50 commissioner finds that additional basic insurance coverage 51 capacity is available, at which time the commissioner shall 52 increase the required basic insurance coverage in accordance 53 with this paragraph.] 54 (5) For policies issued or renewed in calendar year 2010 55 and each year thereafter, the commissioner shall increase the 56 required per occurrence or claim basic insurance coverage by 57 $50,000 increments for a participating health care provider 58 that is not a hospital and for a hospital until such time as 59 the required per occurrence or claim basic insurance coverage SB1137A06012 - 2 -
1 is $750,000. 2 (6) For policies issued or renewed in the calendar year 3 immediately following the calendar year in which the required 4 per occurrence or claim basic insurance coverage is $750,000 5 and each year thereafter, the basic insurance coverage shall 6 be: 7 (i) $1,000,000 per occurrence or claim and 8 $3,000,000 per annual aggregate for a participating 9 health care provider that is not a hospital. 10 (ii) $1,000,000 per occurrence or claim and 11 $3,000,000 per annual aggregate for a nonparticipating 12 health care provider. 13 (iii) $1,000,000 per occurrence or claim and 14 $4,500,000 per annual aggregate for a hospital. 15 * * * 16 Section 712. Medical Care Availability and Reduction of Error 17 Fund. 18 * * * 19 (c) Fund liability limits.-- 20 (1) For calendar year 2002, the limit of liability of 21 the fund created in section 701(d) of the former Health Care 22 Services Malpractice Act for each health care provider that 23 conducts more than 50% of its health care business or 24 practice within this Commonwealth and for each hospital shall 25 be $700,000 for each occurrence and $2,100,000 per annual 26 aggregate. 27 (2) The limit of liability of the fund for each 28 participating health care provider shall be as follows: 29 (i) For calendar year 2003 and each year thereafter, 30 the limit of liability of the fund shall be $500,000 for 31 each occurrence and $1,500,000 per annual aggregate. 32 (ii) If the basic insurance coverage requirement is 33 increased in accordance with section 711(d)(3), (4) or 34 (5) and, notwithstanding subparagraph (i), for each 35 calendar year following the increase in the basic 36 insurance coverage requirement, the limit of liability of 37 the fund shall be [$250,000 for each occurrence and 38 $750,000 per annual aggregate.] $1,000,000 per occurrence 39 or claim and $3,000,000 per annual aggregate for a health 40 care provider except a hospital or $1,000,000 per 41 occurrence or claim and $4,500,000 per annual aggregate 42 for a hospital, minus the amount required for basic 43 insurance coverage under section 711(d)(3) or (4) or the 44 amount the commissioner determines as the required basic 45 insurance coverage under section 711(d)(5), as 46 appropriate. 47 (iii) If the basic insurance coverage requirement is 48 increased in accordance with section [711(d)(4)] 49 711(d)(6) and, notwithstanding subparagraphs (i) and 50 (ii), for each calendar year following the increase in 51 the basic insurance coverage requirement, the limit of 52 liability of the fund shall be zero. 53 * * * 54 [(e) Discount on surcharges and assessments.-- 55 (1) For calendar year 2002, the department shall 56 discount the aggregate surcharge imposed under section 57 701(e)(1) of the Health Care Services Malpractice Act by 5% 58 of the aggregate surcharge imposed under that section for 59 calendar year 2001 in accordance with the following: SB1137A06012 - 3 -
1 (i) Fifty percent of the aggregate discount shall be 2 granted equally to hospitals and to participating health 3 care providers that were surcharged as members of one of 4 the four highest rate classes of the prevailing primary 5 premium. 6 (ii) Notwithstanding subparagraph (i), 50% of the 7 aggregate discount shall be granted equally to all 8 participating health care providers. 9 (iii) The department shall issue a credit to a 10 participating health care provider who, prior to the 11 effective date of this section, has paid the surcharge 12 imposed under section 701(e)(1) of the former Health Care 13 Services Malpractice Act for calendar year 2002 prior to 14 the effective date of this section. 15 (2) For calendar years 2003 and 2004, the department 16 shall discount the aggregate assessment imposed under 17 subsection (d) for each calendar year by 10% of the aggregate 18 surcharge imposed under section 701(e)(1) of the former 19 Health Care Services Malpractice Act for calendar year 2001 20 in accordance with the following: 21 (i) Fifty percent of the aggregate discount shall be 22 granted equally to hospitals and to participating health 23 care providers that were assessed as members of one of 24 the four highest rate classes of the prevailing primary 25 premium. 26 (ii) Notwithstanding subparagraph (i), 50% of the 27 aggregate discount shall be granted equally to all 28 participating health care providers. 29 (3) For calendar years 2005 and thereafter, if the basic 30 insurance coverage requirement is increased in accordance 31 with section 711(d)(3) or (4), the department may discount 32 the aggregate assessment imposed under subsection (d) by an 33 amount not to exceed the aggregate sum to be deposited in the 34 fund in accordance with subsection (m).] 35 * * * 36 (m) Supplemental funding.--Notwithstanding the provisions of 37 75 Pa.C.S. § 6506(b) (relating to surcharge) to the contrary, 38 beginning January 1, 2004, [and for a period of nine calendar 39 years thereafter,] all surcharges levied and collected under 75 40 Pa.C.S. § 6506(a) by any division of the unified judicial system 41 shall be remitted to the Commonwealth for deposit in the Medical 42 Care Availability and Restriction of Error Fund. These funds 43 shall be used to reduce surcharges and assessments [in 44 accordance with subsection (e). Beginning January 1, 2014, and 45 each year thereafter, the surcharges levied and collected under 46 75 Pa.C.S. § 6506(a) shall be deposited into the General Fund] 47 levied under this section. 48 * * * 49 Section 2. The definition of "account" in section 1101 of 50 the act, added December 22, 2005 (P.L.458, No.88), is amended to 51 read: 52 Section 1101. Definitions. 53 The following words and phrases when used in this chapter 54 shall have the meanings given to them in this section unless the 55 context clearly indicates otherwise: 56 "Account." The Health Care Stabilization and Provider 57 Retention Account established in section 1112. 58 * * * 59 Section 3. Section 1102 of the act, amended October 27, 2006 SB1137A06012 - 4 -
1 (P.L.1198, No.128), is amended to read: 2 Section 1102. Abatement program. 3 (a) Establishment.--There is hereby established within the 4 Insurance Department a program to be known as the Health Care 5 Provider Retention Program. The Insurance Department, in 6 conjunction with the Department of Public Welfare, shall 7 administer the program. The program shall provide assistance in 8 the form of assessment abatements to health care providers for 9 calendar years 2003[, 2004, 2005, 2006 and 2007] and each year 10 thereafter until the liability of the fund under section 11 712(c)(2)(iii) is zero, except that licensed podiatrists shall 12 not be eligible for calendar years 2003 and 2004, and nursing 13 homes shall not be eligible for calendar years 2003, 2004 and 14 2005. 15 (b) Other abatement.--Emergency physicians not employed full 16 time by a trauma center or working under an exclusive contract 17 with a trauma center shall retain eligibility for an abatement 18 pursuant to section 1104(b)(2) for calendar years 2003, 2004, 19 2005 and 2006. Commencing in calendar year 2007, these emergency 20 physicians shall be eligible for an abatement pursuant to 21 section 1104(b)(1). 22 Section 4. Sections 1104, 1105 and 1112 of the act, added 23 December 22, 2005 (P.L.458, No.88), are amended to read: 24 Section 1104. Procedure. 25 (a) Application.--A health care provider may apply to the 26 Insurance Department for an abatement of the assessment imposed 27 for the previous calendar year specified on the application. The 28 application must be submitted by the second Monday of February 29 of the calendar year specified on the application and shall be 30 on the form required by the Insurance Department. The department 31 shall require that the application contain all of the following 32 supporting information: 33 (1) A statement of the applicant's field of practice, 34 including any specialty. 35 (2) Except for physicians enrolled in an approved 36 residency or fellowship program, a signed certificate of 37 retention. 38 (3) A signed certification that the health care provider 39 is an eligible applicant under section 1103 for the program. 40 (4) Such other information as the Insurance Department 41 may require. 42 (a.1) Electronically filed application.--A hospital may 43 submit an electronic application on behalf of all health care 44 providers when the hospital is responsible for payment of the 45 health care provider's assessment under this act and the 46 hospital has received prior written approval from the Insurance 47 Department. 48 (b) Review.--Upon receipt of a completed application, the 49 Insurance Department shall review the applicant's information 50 and grant the applicable abatement of the assessment for the 51 previous calendar year specified on the application in 52 accordance with all of the following: 53 (1) The Insurance Department shall notify the Department 54 of Public Welfare that the applicant has self-certified as 55 eligible for a 100% abatement of the imposed assessment if 56 the health care provider was assessed under section 712(d) 57 as: 58 (i) a physician who is assessed as a member of one 59 of the four highest rate classes of the prevailing SB1137A06012 - 5 -
1 primary premium; 2 (ii) an emergency physician; 3 (iii) a physician who routinely provides obstetrical 4 services in rural areas as designated by the Insurance 5 Department; or 6 (iv) a certified nurse midwife. 7 (2) The Insurance Department shall notify the Department 8 of Public Welfare that the applicant has self-certified as 9 eligible for a 50% abatement of the imposed assessment if the 10 health care provider was assessed under section 712(d) as: 11 (i) a physician but is a physician who does not 12 qualify for abatement under paragraph (1); 13 (ii) a licensed podiatrist; or 14 (iii) a nursing home. 15 (3) Notwithstanding paragraph (2), upon the required 16 basic insurance coverage being increased under section 17 711(d)(3), (4) or (5), the Insurance Department shall 18 annually increase the abatement each applicant is entitled to 19 claim under paragraph (2) by 10%. 20 (c) Refund.--If a health care provider paid the assessment 21 for the calendar year prior to applying for an abatement under 22 subsection (a), the health care provider may, in addition to the 23 completed application required by subsection (a), submit a 24 request for a refund. The request shall be submitted on the form 25 required by the Insurance Department. If the Insurance 26 Department grants the health care provider an abatement of the 27 assessment for the calendar year in accordance with subsection 28 (b), the Insurance Department shall either refund to the health 29 care provider the portion of the assessment which was abated or 30 issue a credit to the health care provider's professional 31 liability insurer. 32 Section 1105. Certificate of retention. 33 (a) Certificate.--The Insurance Department shall prepare a 34 certificate of retention form. The form shall require a health 35 care provider seeking an abatement under the program to attest 36 that the health care provider will continue to provide health 37 care services in this Commonwealth for at least one full 38 calendar year following the year for which an abatement was 39 received pursuant to this chapter. 40 (a.1) Hospital responsibility.--When a hospital has 41 submitted an application on behalf of a health care provider, 42 the hospital shall be responsible for ensuring compliance with 43 the certificate of retention and shall indemnify the health care 44 provider retention account for each health care provider who 45 fails to continue to provide medical services within this 46 Commonwealth for the year following receipt of the abatement. 47 (b) Repayment.-- 48 (1) Except as provided in paragraph (2), if a health 49 care provider receives an abatement but, prior to the end of 50 the retention period, ceases providing health care services 51 in this Commonwealth, the health care provider shall repay to 52 the Commonwealth 100% of the abatement received plus 53 administrative and legal costs, if applicable. A health care 54 provider subject to this paragraph shall provide written 55 notice to the Insurance Department within 60 days of the date 56 of cessation of health care services. 57 (2) Paragraph (1) shall not apply to a health care 58 provider who is any of the following: 59 (i) A health care provider who is enrolled in an SB1137A06012 - 6 -
1 approved residency or fellowship program. 2 (ii) A health care provider who dies prior to the 3 end of the retention period. 4 (iii) A health care provider who is disabled and 5 unable to practice prior to the end of the retention 6 period. 7 (iv) A health care provider who is called to active 8 military duty prior to the end of the retention period. 9 (v) A health care provider who retires and who is at 10 least 70 years of age prior to the end of the retention 11 period. 12 (c) Tax.--An amount owed the Commonwealth under subsection 13 (b) shall be considered a tax under section 1401 of the act of 14 April 9, 1929 (P.L.343, No.176), known as The Fiscal Code. The 15 Department of Revenue shall provide assistance to the Insurance 16 Department in any collection effort. Any amount collected under 17 this chapter, including administrative and legal costs, shall be 18 deposited into the [Health Care Provider Retention Account] 19 account. 20 (d) Failure to pay.--The Insurance Department shall notify 21 the appropriate licensing board of any failure to pay an amount 22 required of a licensee under this section. Upon such 23 notification, the licensing board shall suspend or revoke the 24 license of the licensee. 25 Section 1112. Health Care Stabilization and Provider Retention 26 Account. 27 (a) Fund established.--There is established within the 28 General Fund a special account to be known as the Health Care 29 Stabilization and Provider Retention Account. Funds in the 30 account shall be subject to an annual appropriation by the 31 General Assembly [to the Department of Public Welfare. The 32 Department of Public Welfare shall administer funds appropriated 33 under this section]. 34 (a.1) Abatement program appropriations.--Funds appropriated 35 to the Department of Public Welfare for the abatement program 36 shall be administered by the Department of Public Welfare 37 consistent with its duties under section 201(1) of the act of 38 June 13, 1967 (P.L.31, No.21), known as the Public Welfare Code. 39 (a.2) Health care stabilization appropriations.--(Reserved). 40 [(b) Transfers from Mcare Fund.--By December 31 of each 41 year, the Secretary of the Budget may transfer from the Medical 42 Care Availability and Reduction of Error (Mcare) Fund 43 established in section 712(a) to the account an amount equal to 44 the difference between the amount deposited under section 712(m) 45 and the amount granted as discounts under section 712(e)(2) for 46 that calendar year.] 47 (c) [Transfers] Abatement transfers from account.--The 48 Secretary of the Budget [may] shall annually transfer from the 49 account to the Medical Care Availability and Reduction of Error 50 (Mcare) Fund an amount [up] equal to the aggregate amount of 51 abatements granted by the Insurance Department under section 52 1104(b)[.], minus the sum of the amount deposited in the fund 53 under section 712(m) and any payments of the assessment levied 54 under section 712(d). 55 (d) Other deposits.--The Department of Public Welfare may 56 deposit any other funds received by the department which it 57 deems appropriate in the account. 58 [(e) Administration assistance.--The Insurance Department 59 shall provide assistance to the Department of Public Welfare in SB1137A06012 - 7 -
1 administering the account.] 2 Section 5. Section 1115 of the act, amended October 27, 2006 3 (P.L.1198, No.128), is repealed: 4 [Section 1115. Expiration. 5 The Health Care Provider Retention Program established under 6 this chapter shall expire December 31, 2008.] 7 Section 6. The act is amended by adding a section to read: 8 Section 1116. Health Care Provider Retention Reserve Account. 9 (a) Establishment.--There is established within the General 10 Fund a special account to be known as the Health Care Provider 11 Retention Reserve Account. The funds in the account shall only 12 be used for the purpose of reducing unfunded liability under 13 Chapter 7. 14 (b) Transfer.--Notwithstanding any other provision of this 15 act, the Secretary of the Budget shall, as of December 31, 2007, 16 transfer all funds in the account into the Health Care Provider 17 Retention Reserve Account. 18 Section 7. Section 1211 of the act of March 4, 1971 (P.L.6, 19 No.2), known as the Tax Reform Code of 1971, is repealed insofar 20 as it is inconsistent with the provisions of this act. 21 Section 8. This act shall take effect immediately. C7L90MSP/SB1137A06012 - 8 -