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
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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:
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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
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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
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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
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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
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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.
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