The Courts and Judiciary Interim Study Committee has been charged with looking at Indiana’s medical malpractice (med-mal) system. The statute was written in 1975 to protect the health of the citizens of Indiana by preventing a reduction of health care services. Prior to the enactment, seven of the 10 insurance companies writing med-mal business at the time either ceased or limited writing the insurance because of unprofitability. Premiums for med-mal skyrocketed at that point. In some cases, physicians were hard pressed or unable to purchase coverage. Likewise, services were discontinued in some locales.
To stabilize the market, the Med-Mal Act created a medical review panel consisting of an attorney and three health care providers. The parties agree to a panel chair, each party chooses one health care provider to be on the panel and the two health care providers choose a third provider to fill out the panel. Parties send submissions to the panel and the providers review the information and determine if there was malpractice. The panel makes an opinion based upon whether or not the provider failed to comply with the standard of care; whether the conduct complained of was a factor of the resultant damages; and whether the health care provider should be reported to the applicable licensing agency. The medical review panel must render its decision before any court action may take place, unless the claim is less than $15,000 or both parties agree to bypass this step.
The system has damages capped to a patient for an act of malpractice at $1.25 million. That cap has been raised twice since 1975. The system is voluntary, but to participate in the protections of the act, physicians purchase a commercial insurance policy to cover the first $250,000 and pay a surcharge to the Patient’s Compensation Fund (PCF) to cover the remaining $1 million in potential liability. Surcharges vary based upon the specialty of the provider. In 2014, nearly $138 million in claims were paid from the PCF.
The Courts and Judiciary Interim Study Committee has entertained testimony on two separate occasions. The debate now concerns whether or not the caps on med-mal need to be raised for the first time since 1999. The balancing act is between trying to maintain the med-mal system in this state, with maintaining access to care and low premium costs for physicians, and the fear of having the Indiana courts determine the system unconstitutional because the caps haven’t been raised in over 15 years. The committee is also entertaining discussion on the consideration of increasing the bypass threshold (currently $15,000) of the medical review panel – regarding those claims exempt from the medical review panel process.
Committee chairman Sen. Brent Steele (R-Bedford) has asked committee members to review the documentation presented and offer proposals to improve the process. The Indiana Chamber expects there will be a proposal for some increase to the cap.