HB 393 (BR 1354) - B. Yonts
AN ACT relating to medical malpractice insurance and making an appropriation therefor.
Amend KRS 304.13-051 to require the filing of medical malpractice insurance rates; permit any person to send comments to the department of insurance on medical malpractice insurance filings; allow a person who pays premiums for medical malpractice insurance to the insurer that made the filing to request the commissioner to hold a public hearing on the filing; authorize the commissioner to hold a hearing on medical malpractice insurance rate filings; create new sections of Subtitle 40 of KRS Chapter 304 to create the Kentucky medical liability mutual insurance authority to provide medical malpractice insurance to physicians and other health care providers as determined by the board; provide that the authority is a nonprofit, independent, self-supporting de jure municipal corporation and political subdivision of the Commonwealth; provide for a board of directors which shall function in a manner similar to the governing body of a mutual insurance company; direct the board to hire a manager who shall have proven successful experience for a period of at least five (5) years as an executive at the general management level in insurance operations or in the management of a state fund for medical malpractice; establish powers and duties of the manager; provide that the authority shall provide medical malpractice insurance to any licensed physician, and other health care provider as determined by the board, who pays the premium and complies with any other qualifications and conditions adopted by the authority; require the authority to provide coverage to any physician, and other health care provider as determined by the board, who is unable to secure coverage in the voluntary market unless the health care provider owes undisputed premiums to a previous medical malpractice carrier or to a medical malpractice residual market mechanism; direct the authority to establish separate rating plans, rates and underwriting standards for different classes of risks; require rates to be based only on Kentucky experience; authorize the board to declare an annual dividend and distribute it in the form of premium discounts, dividends, or a combination of discounts and dividends if certain conditions are met; require a quarterly report of assets and liabilities to be provided to the board, the Governor, and the Legislative Research Commission; require the board to file an annual report indicating the business done in the previous year and deliver the report to the Governor, commissioner of the Department of Insurance, Auditor of Public Accounts, Attorney General, and co-chairs of the Legislative Research Commission; prohibit the authority from entering into a contract for an audit unless the Auditor of Public Accounts has turned down a request to perform the audit; provide that if the assets of the authority are less than its liabilities, the board may levy an assessment on its policyholders; require the board to formulate and adopt an investment policy; require the manager to compile and maintain statistical and actuarial data; prohibit the authority from receiving any direct state general fund appropriation; provide that upon request of the board, the Governor and the Secretary of the Finance and Administration Cabinet may authorize initial funding which may include a loan from an existing state agencies not to exceed seven million dollars ($7,000,000); provide that the authority may utilize only agents duly and legally licensed and in good standing with the provisions of this chapter; exempt board members, the manager, and any employee from being held personally liable for acts taken in official capacity; require the board, manager, and employees to comply with the Executive Branch code of ethics; prohibit the authority from participating in any plan, pool, association, guarantee, or insolvency fund required by this chapter; require the board to comply with the open meetings and open records laws; direct the Attorney General and the Auditor of Public Accounts to monitor operations of the authority and authorize each to make examinations or investigations of the operations, practices, management, and other matters of the authority; require the Attorney General and the Auditor of Public Accounts to report jointly to the General Assembly in January in each year in which the General Assembly convenes in an even-numbered regular session the results of their monitoring activities; and create a new section of KRS Chapter 411 to encourage the Kentucky Supreme Court to promote mediation and arbitration of claims in a malpractice action against a health care provider.
HB 393 - AMENDMENTS
HCS - Delete original provisions of he Act; create new sections of KRS Chapter 305 to create the Kentucky Providers' Mutual Insurance Authority as a nonprofit, independent, self-supporting de jure municipal corporation and political subdivision of the state; provide for a board of directors which shall include the board of the Kentucky Employers' Mutual Insurance Authority; provide that the board functions similar to the governing body of a mutual insurer; establish powers of the board; direct the board to hire a manager with at least 5 years experience as an executive at the general management level in insurance operations with expertise in medical malpractice or in the management of a state fund for medical malpractice; direct the manager to conduct the day-to-day operations of the authority; authorize the authority to provide medical malpractice insurance coverage to any health care provider who pays the premiums and meets any conditions and qualifications established by the board; provide for regulation of rates; require rates to be based on Kentucky loss experience data unless supplemental data is needed for statistical credibility; require the authority to report annually to the Interim Joint Committee on Banking and Insurance on its efforts to build and maintain a surplus; permit the board to declare an annual dividend; require a quarterly report of assets and liabilities to the board, Governor, and Legislative Research Commission; provide that in determining solvency of the authority the practice of discounting the funds to reduce future liabilities is not allowed; require an annual report of the business done by the authority to be delivered to the Governor, insurance commissioner, auditor of public accounts, attorney general, and the Legislative Research Commission; direct the board to formulate an investment policy; direct the manager to compile and maintain statistical data; provide that the authority may not receive direct appropriations from the general fund; permit the board to request initial funding from the Governor and secretary of the Finance and Administration Cabinet; allow the Kentucky Employers' Mutual Insurance Authority to loan the authority up to $5,000,000 to be repaid over 7 years; permit an annual or one-time surcharge to be levied on health care providers insured by the authority; permit the board to issue revenue bonds in an amount not to exceed $40,000,000 if approved by the secretary of the Finance and Administration Cabinet; provide that agents selling insurance contracts of the authority be licensed; provide that no board member, the manager, or employee shall be held personally liable for any act performed in an official capacity; require compliance with the executive branch code of ethics; exempt the authority from participation in any plan, pool, association, guarantee, or insolvency fund authorized by the insurance code; require the board to comply with the open meetings and open records laws; direct the Attorney General and the Auditor of Public Accounts to monitor the operations of the authority; require policies to be approved by the commissioner of insurance; provide that the authority is subject to sections of the insurance code to the extent they are not in conflict with this Act; amend KRS 342.829 to allow the Kentucky Employers' Mutual Insurance Authority to make a loan to the Kentucky Providers' Mutual Insurance Authority; create a new section of KRS Chapter 454 to require an affidavit by the plaintiff's attorney to be served upon the defendant with the summons and complaint in which the plaintiff's attorney states he or she has reviewed the facts of the case with an expert who is of the opinion that one or more of the defendants deviated from the applicable standard of care and caused injury to the plaintiff; create a new section of KRS Chapter 454 to require all lawsuits involving claims of professional negligence against health care providers to be subject to mediation to take place within 90 days after all responsive pleadings have been filed; provide that agreements reached at mediation are legally binding.
HFA (1/P, K. Upchurch) - Delete provisions of bill; attach the provisions of SB 1.
HFA (2/Title, K. Upchurch) - Make title amendment.
HFA (3/Title, R. Wilkey) - Make title amendment.
HFA (4, R. Damron) - Create a new section of KRS Chapter 141 to tax as income at a rate of 100% the proceeds of punitive damages recovered in a civil action against a health care provider; distribute the funds to aid in funding the Medicaid program.
HFA (5, R. Damron) - Amend to delete Section 24 of the bill relating to certificates of merit; add additional sections to create several new sections of KRS Chapter 454 to create medical malpractice review panels to be used in civil actions alleging malpractice by a health care provider, with the panels being chaired by a senior status judge and composed of three physicians; include provisions for the creation, operation, administration, and report of the review panels; provide that the review panel's findings may be used in a motion for summary judgment; provide that a civil action be held in abeyance while the review panel is performing its review or while mediation under a separate provision of the bill is taking place.
HFA (6, P. Bather) - Retain original provisions; require the Interim Joint Committee on Banking and Insurance to complete a study related to a system for reporting and analyzing health care errors; require a final report to the Legislative Research Commission no later than November 1, 2003.
HFA (7, R. Wilkey) - Retain identical text as Floor Amendment 5, except add clarifying clause at the end of the last section of the amendment specifying that evidence may not be used in motion for summary judgment while the civil action is otherwise held in abeyance.
Feb 10-introduced in House
Feb 11-to Banking and Insurance (H)
Feb 12-posted in committee
Feb 21-posting waived
Feb 26-reported favorably, 1st reading, to Calendar with Committee Substitute ; floor amendment (1) filed to Committee Substitute, floor amendments (2-title) and (3-title) filed
Feb 27-2nd reading, to Rules; posted for passage in the Regular Orders of the Day for Friday, February 28, 2003; floor amendments (4) and (5) filed to Committee Substitute
Feb 28-recommitted to Appropriations and Revenue (H); floor amendments (6) and (7) filed to Committee Substitute