Governor Taft signs bill that creates a medical liability fund while urging further reforms

On Monday, Governor Bob Taft signed a bill creating a state-backed medical malpractice insurance "backup" fund. The measure (HB 282) goes into immediate effect due to an emergency clause, however, Ohio Department of Insurance Director Ann Womer Benjamin said the agency would have to promulgate rules and make plans to transfer the $12 million remaining in a fund from the last time the state had to intervene in the malpractice insurance market in the mid-1970s.

ODI Director Ann Womer Benjamin indicated that the Medical Liability Underwriting Association would only be activated if there were a lack to of available insurance coverage and impediments to health care. Four insurers have stopped selling coverage in Ohio since December 2001, and at least 73 doctors have left Ohio or cut back their practices in recent months, Ohio Department of Insurance figures show. ODI continues to work with insurance firms to urge entrance into the Ohio medical malpractice market, and one company has expressed interest in coming into Ohio and a current provider is considering expansion in the state. 

Insurers are also awaiting the outcome of court challenges to the new caps. In 1999, the Ohio Supreme Court overturned the Legislature's second attempt to limit the amount juries could award for damages. However, lawmakers narrowed the scope of the limits in a bill they passed last year and feel the court's current makeup is less likely to throw them out. The industry is watching the issue closely.

Governor Taft called the current insurance climate in the state "a crisis that threatens the availability of good medical care" and asked the legislature to take further action. The governor asked for action on five other initiatives as part of the state's effort to stem the tide of malpractice insurance problems. These are:

• House passage of SB 187, a bill sponsored by Senator Scott Nein (R-Middletown), that requires 60 days notice of cancellations or rate increase to policyholders and 120 days notice to ODI for companies that intend to stop coverage of a specialty or geographic area. The bill cleared the Senate unanimously on March 31.
• Enactment of a bill allowing doctors to self-insure.
• The creation of a "comprehensive data reporting" system to better track judgments, settlements and other aspects of medical malpractice as recommended by the commission.
• Action by the Ohio Supreme Court and General Assembly to establish a screening process for malpractice claims.
• Legislation to create a patient compensation fund.

The AMC/NOMA supports each of these initiatives and sent testimony in support of the MLUA.