PRINTER'S NO. 1596
No. 1367 Session of 1975
INTRODUCED BY FINEMAN, A. K. HUTCHINSON, IRVIS, MANDERINO,
SHANE, BERSON, O'KEEFE, DeMEDIO, MORRIS, MILLIRON, GEORGE,
COLE, STAPLETON, BRUNNER, ENGLEHART, SCHMITT, RAPPAPORT,
GILLESPIE, REED, GARZIA, WOJDAK, TOLL, SCHWEDER, ROMANELLI,
PETRARCA, SALOOM, BLACKWELL, KOLTER, ZORD, CESSAR AND FISHER,
JUNE 3, 1975
REFERRED TO COMMITTEE ON JUDICIARY, JUNE 4, 1975
AN ACT
1 Relating to medical and health related malpractice insurance,
2 prescribing the powers and duties of the Insurance
3 Department, providing for a joint underwriting association;
4 the Regional Arbitration Panels for Health Care, compulsory
5 screening of claims; collateral sources requirement;
6 limitation of Statute of Limitations; limitation on
7 contingent fee compensation; and prescribing penalties.
8 The General Assembly of the Commonwealth of Pennsylvania
9 hereby enacts as follows:
10 ARTICLE I
11 Preliminary Provisions
12 Section 101. Short Title.--This act shall be known and may
13 be cited as the "Health Care Services Malpractice Act."
14 Section 102. Legislative Findings.--The General Assembly
15 finds that:
16 (1) The number of suits and claims for damages arising from
17 professional patient care has increased greatly in the past
18 several years and the size of judgments and settlements in
1 connection therewith have increased substantially.
2 (2) The effects of such suits and the settlements of such
3 claims have allegedly caused the insurance industry providing
4 patients' compensation insurance coverage to uniformly and
5 substantially increase the cost of such insurance coverage.
6 (3) These increased insurance costs are being passed on to
7 patients in the form of higher charges for health care services
8 and facilities.
9 (4) The increased costs of providing health care services,
10 the increased incidence of claims and suits against health care
11 providers, and the large size of such claims and judgments, have
12 caused liability insurance companies to withdraw from insuring
13 high risk health care providers.
14 (5) The rising number of suits and claims may be forcing
15 health care providers to practice defensively, viewing each
16 patient as a potential adversary in a lawsuit, to the detriment
17 of both the health care provider and the patient. Health care
18 providers for their own protection have often employed excessive
19 diagnostic procedures for their patients, unnecessarily
20 increasing the cost of patient care.
21 (6) As a result of the increase of suits and claims and the
22 costs thereof, some health care providers refuse to provide
23 certain health care services which in themselves entail some
24 risk of patient injury.
25 (7) Many health care providers cannot obtain insurance and
26 are thus exposing consumers to unreasonable risk in the event of
27 loss.
28 (8) The difficulty and high cost of obtaining insurance for
29 health care providers discourages young physicians from entering
30 into the practice of medicine in the Commonwealth of
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1 Pennsylvania, resulting in the loss of physicians to other
2 states.
3 (9) The difficulty and high cost of obtaining insurance
4 affects the medical and hospital services available in the
5 Commonwealth of Pennsylvania to the detriment of its citizens.
6 (10) Some health care providers have been forced to curtail
7 the practice of all or a part of their professions because of
8 the unavailability and high cost of patients' compensation
9 insurance.
10 (11) The cumulative effect of suits and claims is working to
11 the detriment of both the health care providers and the citizens
12 of the Commonwealth.
13 Section 103. Purpose.--Due to the conditions stated in
14 section 102, it is the purpose of this act to make available
15 patients' compensation insurance at a reasonable cost, and to
16 establish a system through which a person who has sustained
17 injury or death as a result of tort or breach of contract by a
18 health care provider can obtain a prompt determination and
19 adjudication of his claim and fair and reasonable compensation
20 at a fair and reasonable cost.
21 Section 104. Definitions.--As used in this act:
22 "Administrator" means the office of Administrator for
23 Regional Arbitration Panels for Health Care.
24 "Arbitration panel" means Regional Arbitration Panels for
25 Health Care.
26 "Commissioner" means the Insurance Commissioner of this
27 Commonwealth.
28 "Health care provider" means a person, corporation, facility
29 institution or other entity licensed by the Commonwealth to
30 provide health care or professional services as a physician,
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1 including a medical doctor and a doctor of osteopathy; dentist,
2 optometrist; podiatrist; psychologist; chiropractor; practical
3 nurse; registered nurse; hospital; nursing home; health
4 maintenance organization; physical therapist; health care
5 delivery organization for which a professional liability program
6 is not generally available; or an officer, employee or agent
7 thereof acting in the course and scope of his employment.
8 "JUA" means the Pennsylvania Joint Underwriting Association
9 established under Article VIII.
10 "Licensure Board" means the State Board of Medical Education
11 and Licensure, the State Board of Osteopathic Examiners, the
12 State Board of Nurse Examiners, the State Dental Council and
13 Examining Board, the State Board of Optometrical Examiners, the
14 State Board of Podiatry Examiners, the Pennsylvania Board of
15 Psychologist Examiners, the State Board of Chiropractic
16 Examiners, the Department of Public Welfare and the Department
17 of Health.
18 "Patient" means a natural person who receives or should have
19 received health care from a licensed health care provider.
20 "Patients' Compensation Insurance" means insurance covering
21 health care provider liability as defined in Article VI.
22 ARTICLE II
23 Services Rendered by Non-Health Care Providers
24 Section 201. Any person rendering services normally rendered
25 by a health care provider who fails to qualify as a health care
26 provider under this act is subject to liability under the law
27 without regard to the provisions of this act.
28 ARTICLE III
29 Administrator for Regional Arbitration Panels for Health Care
30 Section 301. There is established within the Department of
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1 Insurance the office of Administrator for Regional Arbitration
2 Panels for Health Care to be appointed by the Governor. The
3 salary of the administrator shall be set by the Executive Board.
4 Section 302. The administrator may be removed by the
5 Governor for incompetence, neglect of duty, misconduct in
6 office, or other good cause to be stated in writing in the order
7 of removal.
8 Section 303. The administrator shall appoint a secretary and
9 such other employees as are required to administer this act.
10 Their salaries shall be set by the Executive Board.
11 Section 304. (a) The administration of this act shall be
12 funded in part from fees charged to each health care provider
13 practicing in the Commonwealth.
14 (b) Health care providers practicing in the Commonwealth
15 shall be charged annually as follows:
16 (1) Physicians $50
17 (2) Dentists 50
18 (3) Podiatrists 50
19 (4) Optometrists 25
20 (5) Psychologists 25
21 (6) Chiropractors 25
22 (7) Registered Nurses 5
23 (8) Practical Nurses 5
24 (9) Physical Therapists 5
25 (c) An annual fee of $500 shall be charged to each hospital
26 with 250 or more beds. An annual fee of $350 shall be charged to
27 all other hospitals. An annual fee of $100 shall be charged to
28 all other health care organizations.
29 Section 305. The administrator shall prepare, print and
30 furnish upon request and free of charge, such blank forms and
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1 literature as he considers necessary to facilitate and promote
2 the efficient administration of this act.
3 Section 306. The administrator shall submit to the Governor
4 and the General Assembly annually, on or before December 1, a
5 report of the work of the administrators office during the
6 preceding fiscal year.
7 Section 307. The Attorney General, after consultation with
8 the Insurance Commissioner and the Secretary of Health, shall
9 adopt and publish such uniform rules and regulations as may be
10 necessary to carry out the provisions of this act, and prescribe
11 the means, methods and practices necessary to effectuate such
12 provisions.
13 Section 308. Regional Arbitration Panels for Health Care.--
14 (a) Regional arbitration panels shall be established by the
15 Governor. Regional boundaries shall be those districts
16 established by the Professional Standards Review Organization as
17 designated in section 249 F, Professional Standards Review,
18 Title II, 42 U.S.C. §1301. The regions shall be modified to the
19 extent that they are modified by that act. If said act is
20 repealed, the regions shall remain as last established by said
21 act.
22 (b) Each Regional Arbitration Panel for Health Care shall be
23 composed of three members who reside in the Professional
24 Standards Review Organization region, including one health care
25 provider practicing in the Professional Standards Review
26 Organization region, one attorney licensed to practice before
27 the Pennsylvania Supreme Court and one layperson who is not a
28 health care provider nor engaged in the practice of law or any
29 other profession to which this act relates. Arbitration panel
30 members for each region shall be appointed by the Governor.
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1 (c) The Governor shall appoint two alternates for each
2 category of arbitration panel members who shall serve on the
3 arbitration panel in the event that an arbitration panel member
4 must be absent or has a conflict of interest in a particular
5 case. In the event that the alternates have a conflict of
6 interest in a particular case, the remaining arbitration panel
7 members shall choose a substitute to sit for that case.
8 (d) Except as hereinafter provided, each arbitration panel
9 member shall hold office for three years or until his successor
10 is appointed and assumes office. Initial members shall hold
11 office for one, two and three years, respectively.
12 (e) The attorney and health care provider members of each
13 arbitration panel shall be practicing members of their
14 respective professions. No member shall participate in a case in
15 which he may have an interest. The chairperson shall appoint a
16 temporary alternate from the same category of panel member for
17 such cases.
18 (f) Arbitration panel members shall be paid on a per diem or
19 salary basis as fixed by the Executive Board plus actual and
20 necessary expenses incurred in the performance of their official
21 duties. The administrator shall provide for all other necessary
22 expenses of the arbitration panels.
23 (g) Each arbitration panel shall select its own chairperson.
24 (h) A member of an arbitration panel may be removed by the
25 Governor for incompetence, neglect of duty, misconduct in
26 office, or other good cause to be stated in writing in the order
27 of removal.
28 (i) No member shall participate in a case in which he may
29 have an interest. The chairperson shall appoint a temporary
30 alternate from the same category of arbitration panel member for
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1 such case. If the chairperson has an interest in the case, the
2 alternate shall be chosen by the remaining arbitration panel
3 members.
4 Section 309. The arbitration panel shall have exclusive
5 jurisdiction to hear and decide any claim for compensation or
6 benefits brought by a patient or his representative pursuant to
7 the provisions of Article VI.
8 ARTICLE IV
9 Procedure Before the Regional Arbitration Panel
10 Section 401. A patient or his representative, having a claim
11 for compensation or benefits pursuant to Article VI shall file a
12 complaint with the administrator. The administrator shall refer
13 the complaint to the appropriate arbitration panel.
14 Section 402. Upon assignment of a complaint to an
15 arbitration panel, said arbitration panel shall review the
16 complaint in accordance with the rules and regulations
17 promulgated by the Attorney General.
18 ARTICLE V
19 Procedure Before the Regional Arbitration Panel for Health Care
20 Section 501. Arbitration panel hearings shall be conducted
21 in the Professional Standards Review Organization region where
22 the cause of action arose, but may, within the discretion of the
23 administrator, be held in any other place.
24 Section 502. The arbitration panel, at any time, upon a
25 proper showing or on its own motion, may order, with appropriate
26 notice, that any additional party be joined when it deems the
27 presence of that party necessary and proper to a just
28 determination of the claim.
29 Section 503. Service of complaints and notice of all
30 hearings and proceedings before the arbitration panel, unless
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1 otherwise directed, shall be made personally or given by
2 certified mail, and proof of the mailing of notice shall be
3 prima facie evidence of service.
4 Section 504. All briefs or pleadings shall contain a
5 certification that on or before the day of filing, a copy of the
6 document was served on opposing counsel, or on the adverse party
7 or parties if there is no counsel of record.
8 Section 505. A majority vote of the full arbitration panel
9 shall be required to decide all matters before it.
10 Section 506. Except as provided in this act, the arbitration
11 panel is bound by the common and statutory law of the
12 Commonwealth, and by the Pennsylvania Rules of Civil Procedure,
13 but may conduct its hearings and its investigations in such
14 manner as in its judgment is best adapted to determine the
15 rights of the parties.
16 Section 507. The arbitration panel may, upon the application
17 of either party or upon its own motion, appoint a disinterested
18 and qualified expert to make any necessary professional or
19 expert examination of the claimant or relevant evidentiary
20 matter and to testify as a witness in respect thereto. Such an
21 expert witness shall be allowed necessary expenses and a
22 reasonable fee to be fixed and paid by the arbitration panel and
23 taxed as costs as the panel deems appropriate.
24 Section 508. (a) The arbitration panel is authorized and
25 empowered to:
26 (1) examine the relevant facts to determine if a case exists
27 for recovery pursuant to Article VI;
28 (2) ascertain undisputed facts;
29 (3) take depositions and testimony;
30 (4) assure both parties full access to the facts;
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1 (5) make available to the parties the norms, standards and
2 criteria employed by health care providers in the Professional
3 Standards Review Organization region;
4 (6) subpoena witnesses, and administer oaths;
5 (7) apply to the court of common pleas to enforce the
6 attendance and testimony of witnesses and the production and
7 examination of books, papers and records;
8 (8) consider and approve offers of settlement and proposals
9 of adjustment between plaintiffs and defendants;
10 (9) make determinations as to liability and award of
11 damages; and
12 (10) exercise all other powers and duties conferred upon it
13 by law.
14 (b) A copy of the arbitration panel's decision shall be sent
15 to each part at the same time it is submitted to the
16 administrator.
17 Section 509. Appeals from determinations made by the
18 arbitration panel may be taken to the court of common pleas in
19 the same manner as appeals in civil actions, except that where
20 the arbitration panel finds the defendant not liable to the
21 plaintiff, the plaintiff may appeal to the court of common pleas
22 only upon filing bond in the amount of $2,000 secured by cash or
23 its equivalent with the prothonotary of the court in which he
24 seeks to file his appeal. Said bond shall be payable to the
25 defendant for costs assessed, including witness and experts fees
26 and attorneys fees, if the plaintiff does not prevail in the
27 final judgment.
28 Section 510. Where an appeal is taken the decision and
29 findings of the arbitration panel shall be admissible as
30 evidence before the court.
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1 Section 511. (a) If an appeal is not entered within the
2 prescribed time, the party in whose favor the award shall be
3 made may request the arbitration panel to transfer the record
4 and judgment to the court of common pleas in the district where
5 the plaintiff or defendant resides, for execution. It shall be
6 the duty of the prothonotary, at the request of the party in
7 whose favor the award shall have been made, to issue execution,
8 or such other process as may be necessary and proper, to carry
9 into effect the judgment entered upon such award, subject to the
10 provisions of law concerning the stay of execution upon
11 judgments.
12 (b) After judgment, the plaintiff may proceed upon said
13 transferred record and judgment for the collection thereof, with
14 costs, by execution, bill of discovery or attachment, in like
15 manner as if the same were a judgment of the court to which it
16 has been transferred.
17 Section 512. In an action brought to recover damages under
18 this act, no advance payment made by the defendant health care
19 provider or his patients' compensation insurer to or for the
20 plaintiff shall be construed as an admission of liability for
21 injuries or damages suffered by the plaintiff.
22 Section 513. Any final award in favor of the plaintiff,
23 shall be reduced to the extent of any advance payment. The
24 advance payment shall inure to the exclusive benefit of the
25 defendant or the insurer making the payment.
26 Section 514. In the event that the arbitration panel finds
27 that the injury or death of the patient was the result in whole
28 or in part of tort or breach of contract by a health care
29 provider, the arbitration panel shall report such findings to
30 the licensure board and the Professional Standards Review
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1 Organization for investigation and disciplinary proceedings.
2 ARTICLE VI
3 Awards
4 Section 601. Upon a finding by the arbitration panel that
5 the defendant was negligent in the conduct of professional
6 service as a health care provider, the plaintiff shall have the
7 same rights of recovery for damages as are now provided by law.
8 Section 602. The compensation and benefits awarded under
9 this act shall be reduced by any collateral source of
10 compensation or benefits, public or private. A right of
11 subrogation is not enforceable against any benefit or
12 compensation awarded under this act or against any health care
13 provider or its liability insurer.
14 Section 603. The arbitration panel, in its discretion, may
15 make in addition to its award, an allowance for any part or all
16 of the reasonable costs actually incurred in the necessary
17 preparation and presentation of the plaintiff's case. In the
18 event of dismissal, the panel, in its discretion, may charge
19 court costs to the plaintiff.
20 Section 604. In the event the arbitration panel finds that
21 the injury or damage to the patient was caused in whole or in
22 part by the wilful or wanton misconduct of any of the
23 defendants, the panel may award punitive damages against the
24 defendant.
25 Section 605. When a plaintiff is represented by an attorney
26 in the prosecution of his claim, the arbitration panel, if
27 compensation is awarded, shall fix reasonable attorney's fees
28 and state in the award the amount of the claimant's attorney's
29 fees, which may not exceed 33 1/3% of the award. The fee is
30 binding on the plaintiff, his attorney and all defendants. No
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1 additional fee may be charged in a case in which the plaintiff
2 prevails.
3 Section 606. Attorney fees shall be payable in addition to
4 the award, and assessed against the defendant or defendants.
5 Section 607. No claim for recovery pursuant to the
6 provisions of this act may be commenced, unless the action is
7 filed within the longer period of (i) two years after the breach
8 of contract or the tort complained of, or, (ii) one year after
9 the date when the breach of contract or the tort, or the
10 resulting injury was discovered, or in the exercise of
11 reasonable care, should have been discovered. In no instance
12 shall a claim be commenced for pain and suffering benefits more
13 than six years after the breach of contract or the tort
14 complained of. This section applies to all persons regardless of
15 minority or other legal disability.
16 ARTICLE VII
17 Insurance - Health Care Providers
18 Section 701. Every health care provider subject to the terms
19 of this act shall file with the administrator before August 1 of
20 each calendar year, on a prescribed form, proof of financial
21 responsibility.
22 Section 702. Every health care provider subject to the
23 provisions of this act, shall insure his liability as provided
24 in Article VI, or shall furnish to the administrator a cash or
25 surety bond. The submission of a cash or surety bond is subject
26 to the approval of the administrator and is valid only when
27 approved by the administrator. The insurance, cash or surety
28 bond will be in an amount determined by the Joint Underwriting
29 Association to be sufficient coverage. Health care providers may
30 elect to purchase, and the Joint Underwriting Association shall
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1 provide, patients' compensation insurance in an amount exceeding
2 that determined by the Joint Underwriting Association to be
3 sufficient coverage.
4 ARTICLE VIII
5 Joint Underwriting Association
6 Section 801. Within 90 days after the passage of this act,
7 the commissioner shall establish a Pennsylvania Joint
8 Underwriting Association (JUA), to provide patients'
9 compensation insurance to health care providers. The
10 commissioner may dissolve the Joint Underwriting Association if
11 he determines that it is no longer necessary and that an
12 adequate market will be maintained for patients' compensation
13 insurance by the private insurance industry. The commissioner
14 may reestablish the Joint Underwriting Association if he shall
15 find that the private industry has failed to provide an adequate
16 market for patients' compensation insurance.
17 Section 802. The Joint Underwriting Association shall
18 consist of all insurers authorized to write insurance pursuant
19 to 40 Pa.C.S. Ch. 61 (relating to Hospital Plan Corporations),
20 Ch. 63 (relating to Health Plan Corporations) and, if the entity
21 writes health and accident insurance, Ch. 65 (relating to
22 Fraternal and Beneficial Societies), and §§202(c)(1), (4) and
23 (11), and §202(a)(1) if the insurer writes health and accident
24 insurance, of the act of May 17, 1921 (P.L.682, No.284), known
25 as "The Insurance Company Law of 1921." Each such insurer shall
26 be a member of the Joint Underwriting Association and shall
27 remain a member as a condition of its authority to continue to
28 write such insurance in this Commonwealth pursuant to qualifying
29 powers.
30 Section 803. The Joint Underwriting Association shall
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1 provide patients' compensation insurance to all health care
2 providers in this Commonwealth who desire same. Cancellation or
3 non-renewal of such insurance shall occur only for the failure
4 to pay the required premium or for the suspension or revocation
5 of the health care providers license, during the period of such
6 suspension or revocation.
7 Section 804. The Joint Underwriting Association shall
8 establish a plan of operation as necessary to carry out its
9 purposes. Such plan shall be subject to the approval of the
10 commissioner. Pursuant to the plan of operation, the Joint
11 Underwriting Association shall:
12 (1) issue patient compensation insurance policies to health
13 care providers in its own name;
14 (2) establish procedures for the sharing among the members
15 of profit or loss on Joint Underwriting Association business and
16 other costs, charges, expenses, liabilities, income, property
17 and other assets of the Joint Underwriting Association;
18 (3) reinsure Joint Underwriting Association business as
19 determined to be appropriate by the Joint Underwriting
20 Association;
21 (4) appoint Joint Underwriting Association agents and engage
22 brokers as necessary for the conduct of Joint Underwriting
23 Association business, and fix their compensation;
24 (5) employ or retain such persons as are necessary to assist
25 in the performance of the duties of the Joint Underwriting
26 Association;
27 (6) join, advise, assist, associate, cooperate and contract
28 with its members and with such organizations, associations,
29 including health care provider associations, insurers,
30 governmental agencies and others as may be necessary and proper
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1 to accomplish the purpose of the Joint Underwriting Association;
2 (7) negotiate and become a party to such contracts as are
3 necessary to carry out the purposes of this act;
4 (8) sue and be sued in the name of the Joint Underwriting
5 Association of Pennsylvania. No judgment, obligation or expense
6 against the Joint Underwriting Association creates any direct
7 liability in the individual participating members thereof;
8 (9) conduct studies and review member records for the
9 purpose of determining the causes of patient compensation claims
10 and make recommendations for legislative, regulatory and other
11 changes necessary to reduce the frequency and severity of such
12 claims;
13 (10) report to the General Assembly annually on a date and,
14 on a form prescribed by the commissioner the total amount of
15 premium dollars collected, the total amount of claims paid and
16 expenses incurred therewith, the total amount of reserve set
17 aside for future claims, the nature and substance of each claim,
18 the date and place in which each claim arose, the amounts paid,
19 if any, and the disposition of each claim (judgment of
20 arbitration panel, judgment of court, settlement or otherwise),
21 and such additional information as the commissioner shall
22 require;
23 (11) contract for the servicing of the Joint Underwriting
24 Association's functions;
25 (12) assess members for initial expenses necessary to
26 establish the Joint Underwriting Association, begin operations
27 and pay claims, and thereafter assess members as necessary to
28 continue the operation of the Joint Underwriting Association.
29 The Joint Underwriting Association, in whole or in part, may
30 exempt from assessment any member insurer or defer the
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1 assessment of any member insurer if the assessment would result
2 in the impairment of capital or surplus below that required for
3 the lines of business the company is authorized to conduct in
4 this Commonwealth or in any other jurisdiction;
5 (13) establish rates, rules, and rate classifications as
6 appropriate; and
7 (14) do anything necessary and proper to accomplish the
8 purposes of the Joint Underwriting Association.
9 Section 805. The assessment of members for their appropriate
10 shares of profit or loss on Joint Underwriting Association
11 business shall be based on the members' premium volume or
12 exposure units for business other than Joint Underwriting
13 Association business, or on a combination of such bases, or on
14 any other equitable basis as determined by the commissioner.
15 Section 806. (a) The commissioner shall convene the first
16 meeting of the Joint Underwriting Association which shall elect
17 a Board of Governors. The Joint Underwriting Association Board
18 shall consist of ten members as follows:
19 (1) representatives of seven Joint Underwriting Association
20 member companies; and
21 (2) three persons knowledgeable in insurance matters but not
22 employed by any of the member companies.
23 (b) The members of the Joint Underwriting Association Board
24 shall elect one of its members to be chairperson.
25 (c) The terms of office and method of selection of the
26 subsequent members of the Joint Underwriting Association Board
27 shall be provided in the plan of operation.
28 (d) The plan of operation shall be subject to review by the
29 Insurance Commissioner, and the Insurance Commissioner shall by
30 order approve, amend, modify or disapprove the plan. If
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1 disapproved, the Joint Underwriting Association shall submit a
2 revised plan for review within 30 days of disapproval. If the
3 Joint Underwriting Association fails to do so, or if the revised
4 plan so filed is unacceptable, the Insurance Commissioner shall
5 promulgate a plan of operation.
6 Section 807. The Joint Underwriting Association shall be the
7 sole authorized or eligible source for patients' compensation
8 insurance. Member insurers may write patients' compensation
9 insurance only through the Joint Underwriting Association.
10 Section 808. On or after the effective date of the plan of
11 operation, a health care provider shall be entitled to apply for
12 patients' compensation coverage through the Joint Underwriting
13 Association. The application may be made directly by the health
14 care provider to the Joint Underwriting Association or may be
15 made on his behalf by any insurance agent or broker appointed by
16 the Joint Underwriting Association.
17 Section 809. If the Joint Underwriting Association
18 determines that the applicant is a health care provider, the
19 Joint Underwriting Association, upon receipt of the premium, or
20 that portion of the premium prescribed in the plan of operation,
21 shall issue a policy of patients' compensation insurance which
22 shall include such coverages, amount of insurance and policy
23 periods as are provided in the plan of operation.
24 Section 810. Prior to becoming effective, rates,
25 classifications, rules, rating plans and policy forms proposed
26 for use by the Joint Underwriting Association must be filed with
27 and approved by the Insurance Commissioner in accordance with
28 applicable law.
29 ARTICLE IX
30 General Provisions
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1 Section 901. There shall be no liability on the part of and
2 no cause of action for libel shall arise against any member
3 insurer, the Joint Underwriting Association or its agents or
4 employees, the Board of Governors, the Regional Arbitration
5 Panels, or the commissioner or his representatives for any
6 action taken by any of them in the performance of their
7 respective powers and duties under this act. However, the Joint
8 Underwriting Association shall not be relieved of contract
9 liability for contracts issued under its authority.
10 Section 902. Any termination of a Joint Underwriting
11 Association policy by cancellation is not effective as to
12 patients claiming against the insured covered thereby, unless at
13 least 45 days before the cancellation takes effect, a written
14 notice giving the date upon which termination becomes effective
15 has been received by the board at its offices. Mailing of such
16 notice to the board at its principal office address shall
17 constitute notice to the board.
18 Section 903. The provisions of this act do not apply to
19 injuries or death from services rendered or which should have
20 been rendered by a health care provider which occurred before
21 the effective date of this act.
22 Section 904. Every express contract between a patient and
23 health care provider in existence on the effective date of this
24 act, containing provisions inconsistent with the terms and
25 provisions of this act, remains unimpaired, binding and
26 effective as to all parties until the contract expires or is
27 rescinded by law or the mutual agreement of the parties.
28 Section 905. Fines and Penalties.--(a) No health care
29 provider shall provide any health care or professional services
30 until such assessments as are levied by the administrator are
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1 paid and a patients' compensation insurance policy is obtained
2 from the Joint Underwriting Association or a cash or surety bond
3 is filed and approved by the administrator and receipts showing
4 the same are in the possession of the health care provider.
5 (b) Any health care provider licensed by the Commonwealth or
6 operating under a certificate of authority issued by the
7 Commonwealth who violates the provisions of subsection (a) shall
8 upon conviction in a summary proceeding be sentenced to pay a
9 fine of not less than $100 nor more than $1,000 per day for each
10 day of practice without the necessary receipts, and may be
11 subject to a suspension of his license or certificate of
12 authority, or both.
13 Section 906. Repealer.--All acts and parts of acts are
14 repealed in so far as they are inconsistent with this act.
15 Section 907. Effective Date.--This act shall take effect in
16 180 days.
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