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Indiana Medical Malpractice Act - Chapter 5
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IC
34-18-5
Chapter 5.
Surcharge
IC
34-18-5-1
Annual surcharge on
health care providers
Sec. 1. To
create a source of money
for the patient's
compensation fund, an
annual surcharge shall
be levied on all health
care providers in
Indiana.
As added by
P.L.1-1998, SEC.13.
IC
34-18-5-2
Amount of surcharge
Sec. 2. (a) As
used in this section,
"actuarial program"
means a program used or
created by the
department to determine
the actuarial risk posed
to the patient
compensation fund under
IC 34-18-6 (or
IC 27-12-6 before its
repeal) by a hospital.
The program must be:
(1) developed to
calculate actuarial risk
posed by a hospital,
taking into
consideration risk
management programs used
by the hospital;
(2) an efficient
and accurate means of
calculating a hospital's
malpractice actuarial
risk;
(3) publicly
identified by the
department by July 1 of
each year; and
(4) made
available to a
hospital's malpractice
insurance carrier for
purposes of calculating
the hospital's surcharge
under subsection (g).
(b) Beginning July
1, 1999, the amount of
the annual surcharge
shall be one hundred
percent (100%) of the
cost to each health care
provider for maintenance
of financial
responsibility.
Beginning July 1, 2001,
the annual surcharge
shall be set by a rule
adopted by the
commissioner under
IC 4-22-2.
(c) The amount of
the surcharge shall be
determined based upon
actuarial principles and
actuarial studies and
must be adequate for the
payment of claims and
expenses from the
patient's compensation
fund.
(d) The surcharge
for qualified providers
other than:
(1) physicians
licensed under
IC 25-22.5; and
(2) hospitals
licensed under IC 16-21;
may not exceed the
actuarial risk posed to
the patient's
compensation fund under
IC 34-18 (or IC 27-12
before its repeal) by
qualified providers
other than physicians
licensed under
IC 25-22.5 and hospitals
licensed under IC 16-21.
(e) There is imposed
a minimum annual
surcharge of one hundred
dollars ($100).
(f) Notwithstanding
subsections (b), (c),
and (e), beginning July
1, 1999, the surcharge
for a qualified provider
who is licensed under
IC 25-22.5 is calculated
as follows:
(1) The
commissioner shall
contract with an actuary
that has experience in
calculating the
actuarial risks posed by
physicians. Not later
than July 1 of each
year, the actuary shall
calculate the median of
the premiums paid for
malpractice liability
policies to the three
(3) malpractice
insurance carriers in
the state that have
underwritten the most
malpractice insurance
policies for all
physicians practicing in
the same specialty class
in Indiana during the
previous twelve (12)
month period. In
calculating the median,
the actuary shall
consider the:
(A) manual
rates of the three (3)
leading malpractice
insurance carriers in
the state; and
(B)
aggregate credits or
debits to the manual
rates given during the
previous twelve (12)
month period.
(2) After making
the calculation
described in subdivision
(1), the actuary shall
establish a uniform
surcharge for all
licensed physicians
practicing in the same
specialty class. This
surcharge must be based
on a percentage of the
median calculated in
subdivision (1) for all
licensed physicians
practicing in the same
specialty class under
rules adopted by the
commissioner under
IC 4-22-2. The
surcharge:
(A) must be
sufficient to cover; and
(B) may not
exceed;
the actuarial
risk posed to the
patient compensation
fund under IC 34-18-6
(or IC 27-12-6 before
its repeal) by
physicians practicing in
the specialty class.
(g) Beginning July
1, 1999, the surcharge
for a hospital licensed
under IC 16-21 that
establishes financial
responsibility under
IC 34-18-4 after June
30, 1999, is established
by the department
through the use of an
actuarial program. At
the time financial
responsibility is
established for the
hospital, the hospital
shall pay the surcharge
amount established for
the hospital under this
section. The surcharge:
(1) must be
sufficient to cover; and
(2) may not
exceed;
the actuarial risk posed
to the patient
compensation fund under
IC 34-18-6 by the
hospital.
(h) An actuarial
program used or
developed under
subsection (a) shall be
treated as a public
record under IC 5-14-3.
As added by
P.L.1-1998, SEC.13.
Amended by P.L.111-1998,
SEC.7; P.L.233-1999,
SEC.14.
IC
34-18-5-3
Collection of
surcharge; time for
payment
Sec. 3. (a) The
surcharge shall be
collected on the same
basis as premiums by
each insurer, risk
manager, or surplus
lines producer.
(b) The surcharge is
due and payable within
thirty (30) days after
the premium for
malpractice liability
insurance has been
received by the insurer,
risk manager, or surplus
lines producer from a
health care provider in
Indiana. If a surcharge
is not paid as required
by this section, the
insurer, risk manager,
or surplus lines
producer responsible for
the delinquency is
liable for the surcharge
plus a penalty equal to
ten percent (10%) of the
amount of the surcharge.
(c) If the annual
premium surcharge is not
paid within the time
limit specified in
subsection (b), the
certificate of authority
of the insurer, risk
manager, and surplus
lines producer shall be
suspended until the
annual premium surcharge
is paid.
As added by
P.L.1-1998, SEC.13.
Amended by P.L.178-2003,
SEC.96.
IC
34-18-5-4
Adoption of rules;
comparability of rates
Sec. 4. (a) The
commissioner may adopt
rules establishing the
following:
(1) The manner
of determination of the
surcharge for a health
care provider that
establishes financial
responsibility in a way
other than by a policy
of malpractice liability
insurance.
(2) The manner
of payment of the
surcharge by such a
health care provider.
(b) The surcharge
calculation established
under subsection (a)
must provide
comparability in rates
for insured and
self-insured hospitals.
This surcharge may not
exceed the surcharge
that would be charged by
the residual authority
if the health care
provider electing to
establish financial
responsibility in this
manner had applied to
the residual authority
for insurance.
As added
by P.L.1-1998, SEC.13.
Note:
Anyone
who believes they may have a medical
malpractice claim should immediately consult
an attorney with experience in handling such
cases. As with many areas of the law,
medical malpractice law in Indiana is very
complex and contains numerous caveats and
peculiarities. One should not attempt to
interpret or apply the law to one's case
without the consultation of a medical
malpractice lawyer. Given that various
time limitations may apply, it is highly
advisable to consult such an attorney
without delay, in order to avoid having a
potential claim barred.
For more information, or for
a free attorney consultation with The
Powless Law Firm,
click here, or call toll-free:
(888)922-2889.
This page
was last updated on 8/8/05. It is
highly advisable to undertake an independent
review of the current statute to ensure that
no legislative changes have been adopted
since such time.
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