MALPRACTICE; MEDICAL MALPRACTICE; MEDICAL MALPRACTICE INSURANCE; PATIENTS' RIGHTS;

INSURANCE - MALPRACTICE;

You asked several follow up questions concerning a recent OLR report (2003-R-0606) on patient compensation funds. Specifically, you asked which states allow patients to opt out of the fund, how much private insurance must doctors carry to participate in the fund, which states with funds impose damage caps, and how sound are the funds?

Eight states have active funds- Indiana, Kansas, Louisiana, Nebraska, New Mexico, Pennsylvania, South Carolina, and Wisconsin.

OPT OUT PROVISIONS

Only one state-Nebraska-allows patients to opt out of the fund. If a patient chooses not to be covered by the fund, he or his representative must make that election in writing to the Nebraska Insurance Director. This must be done in advance of treatment and renewed every two years. Additionally, the patient must notify his physician as soon as is “reasonable under the circumstances” that he has so elected.

MINIMUM MALPRACTICE REQUIREMENTS

South Carolina is the only state that does not impose a minimum private insurance requirement on doctors as a condition of participation in its fund. Louisiana has the lowest requirement - $ 100,000 per claim. Kansas, Nebraska, and New Mexico each require doctors to maintain a $ 200,000 per claim malpractice insurance policy policy, Pennsylvania requires $ 500,000 and Wisconsin imposes the highest requirement, $ 1,000,000 per claim.

DAMAGE CAPS

Pennsylvania and South Carolina are the only two states with patient compensation funds that do not impose a damage cap of any kind. Two states, Indiana and Nebraska, impose a total damage cap that covers economic as well as non-economic damages. It is currently $ 1,250,000 in each state, but Nebraska’s will increase to $ 1,750,000 on January 1, 2004.

Wisconsin imposes a total damage cap for wrongful death cases. For children it is $ 500,000; for adults it is $ 350,000. In addition, Wisconsin imposes an adjustable cap for non-economic damages for malpractice cases involving injuries but not death. Each May the director of state courts adjusts the cap to reflect changes in the consumer price index. Currently, the cap is $ 422,632.

Louisiana and New Mexico have a cap that applies to noneconomic damages and economic damages other than future medical care. Louisiana caps its damage at $ 500,000 and New Mexico at $ 600,000. The cap in each state does not apply to future medical costs. Theses costs are paid by the funds each year as bills are presented, up to amount of the judgment or settlement for future medical damages.

Finally, Kansas imposes a $ 250,000 cap on noneconomic damages.

FISCAL SOUNDNESS OF THE FUNDS

The fund in Pennsylvania has experienced major financial difficulties in recent years and is scheduled to be phased out by 2009. The Nebraska fund is experiencing some pressure primarily because of as many as 80 claims against one doctor in connection with a hepatitis C outbreak. Otherwise the funds in the other states appear to be financially sound. We have dealt with this issue in much greater detail in OLR 2003-R-0742.

We have dealt with the legal requirements and damages issues relating to the funds in greater detail in OLR 2003-R-0606.

GC: eh