The Extension of the Mcare Fund
In early October, Governor Ed Rendell highlighted the improvements in Pennsylvania’s medical malpractice system. A looming issue, however, is whether he will agree to extend the Mcare fund.
In Pennsylvania, doctors and hospitals are required to carry $1 million in medical malpractice insurance. The first $500,000 is through private insurers, while Mcare provides an additional $500,000.
The Pennsylvania House proposed legislation to postpone the phase-out of the Mcare Fund for seven years. The bill was approved by the Senate, and now just requires approval from Rendell. Rendell has expressed his support for the bill, but wants to review the bill’s provisions. The extension of the Mcare Fund has been endorsed by professional groups, including the Pennsylvania Orthopedic Society and the Pennsylvania Association for Justice, two organizations that are rarely on the same page concerning political issues.
The Mcare Fund was established in 2002 as a way to combat the high medical malpractice premiums charged by insurance companies and paid by physicians and hospitals. The medical malpractice system in Pennsylvania has undergone various changes since the Mcare Fund was put into place in 2002. In his press release, Rendell pointed to an almost 20% decline in insurance rates for the primary level of coverage in the private market. Additionally, there is more competition in the private insurance market with more than 21 new carriers. As a result, more and more doctors and hospitals have an adequate amount of medical malpractice insurance and they are paying less for it.
In 2009, Rendell stated that he would not seek to renew the Mcare Fund and that the reform of medical malpractice was complete. He did not see any need for further improvements. Despite this declaration, the Mcare Fund is likely to be extended. Rendell is said to have some reservations on certain language that returns unspent money to hospitals instead of rolling it over into the next year’s fund. It is clear, however, based on the changes to the system, including the requirement of a certificate of merit and stricter venue rules, that Pennsylvania has succeeded in driving down the rates that insurers have charged doctors and hospitals for malpractice coverage.
