FISCAL NOTE
SENATE, No. 285
STATE OF NEW JERSEY
213th LEGISLATURE
DATED: DECEMBER 10, 2008
SUMMARY
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Synopsis: |
Establishes a Medical Malpractice Court. |
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Type of Impact: |
General Fund expenditure |
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Agencies Affected: |
Judiciary |
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Fiscal Impact |
Fiscal Year 2009 |
Fiscal Year 2010 |
Fiscal Year 2011 |
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State Cost |
$8,630,891 |
$8,728,278 |
$9,018,093 |
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· The Office of Legislative Services concurs with the Executive estimate but notes that the estimate provides a full year cost of operating in FY 2009. Since the State is currently in the midst of Fiscal Year 2009, salary and fringe benefits costs would be less, depending upon the enactment date and date of personnel hires.
· The bill would establish a Medical Malpractice Court as a court of limited jurisdiction similar to the current Tax Court. The court would have jurisdiction with respect to: (1) any dispute concerning medical malpractice liability insurance; (2) any action where the parties have agreed in writing that any matter arising out of the agreement would be resolved in Medical Malpractice Court; (3) any action for injury against a health care provider based on negligence; (4) any other medical malpractice dispute as provided by the Rules of the Supreme Court; (5) any action cognizable in the Superior Court which raise issues as to which judicial expertise in matters involving medical malpractice is desirable, which are not within the jurisdiction of the Chancery Division of the Superior Court, and which have been transferred to the Medical Malpractice Court pursuant to the Rules of the Supreme Court; or (6) any other matters as may be provided by statute.
· The Administrative Office of the Courts (AOC) states that in establishing the costs associated with the establishment of a court of limited jurisdiction, this analysis divides the costs into three distinct segments: judge teams; centralized management office; and on-line information system.
· Total annual costs to the Judiciary for the twelve new judgeships in FY 2009, FY 2010, and FY 2011 are $6,810,036, $5,718,852 and $5,858,196, respectively.
· Total expenses for the centralized management office in FY 2009, FY 2010, and FY 2011 are $1,282,559, $1,220,687 and $1,281,721, respectively.
· The AOC states that a new information technology system would be required at a cost of $538,296 during the first year of system operation, $1,788,739 during the second year, and $1,878,176 during the third year of system operation. Because a large portion of the second and third year costs would fund one-time system design and programming, the fourth and succeeding years of IT costs would decline to $21,122.
BILL DESCRIPTION
Senate Bill No. 285 of 2008 would establish a Medical Malpractice Court as a court of limited jurisdiction similar to the current Tax Court. The Medical Malpractice Court would have jurisdiction with respect to: (1) any dispute concerning medical malpractice liability insurance; (2) any action where the parties have agreed in writing that any matter arising out of the agreement would be resolved in Medical Malpractice Court; (3) any action for injury against a health care provider based on negligence; (4) any other medical malpractice dispute as provided by the Rules of the Supreme Court; (5) any action cognizable in the Superior Court which raise issues as to which judicial expertise in matters involving medical malpractice is desirable, which are not within the jurisdiction of the Chancery Division of the Superior Court, and which have been transferred to the Medical Malpractice Court pursuant to the Rules of the Supreme Court; or (6) any other matters as may be provided by statute.
The Governor would nominate and appoint, with the advice and consent of the Senate, the judges of the Medical Malpractice Court. The court would consist of not less than six judges and not more than 12 judges. The judges of this court would be required have been admitted to the practice of law in this State for at least 10 years prior to appointment. Judges of the Medical Malpractice Court would hold their offices for initial terms of seven years and until their successors are appointed and qualified, and upon reappointment would hold their offices during good behavior. The judges would be required to retire at the age of 70 years, upon the same terms and conditions as judges of the Superior Court, and would have the same pension rights and other benefits as judges of the Superior Court. Each judge would receive an annual compensation and other benefits equal to that of a judge of the Superior Court. The judges would be subject to impeachment and removal from office by the Supreme Court as is provided by law.
The Chief Justice would assign one of the judges of the Medical Malpractice Court to be the presiding judge. The presiding judge would, subject to the supervision of the Chief Justice and the Administrative Director of the Courts, be responsible for the administration of the court.
FISCAL ANALYSIS
EXECUTIVE BRANCH
The AOC states that in establishing the costs associated with the establishment of a court of limited jurisdiction, this analysis divides the costs into three distinct segments: judge teams; centralized management office; and on-line information system.
Judge Teams:
According to the AOC, the Judiciary would require 12 additional judge teams to implement the provisions of this bill. Each judge team consists of a Superior Court Judge, a Judge's Secretary, a Law Clerk, a Court Clerk, and an Official Court Reporter. The AOC notes that under P.L.2007, c.350, Medical Malpractice Judges would receive a salary increase effective January 1, 2009. Salary and fringe benefits costs for each would equal $395,273 in FY 2009, $408,877 in FY2010 and $417,105 in FY 2011. The cost of salary and fringe benefits for 12 additional judge teams would equal $4,743,276 in FY 2009, during FY 2009, $4,906,524 in FY 2010, and $5,005,260 in FY 2011
The AOC notes that one-time start-up costs of $107,760 per judge team, or $1,293,120 would be generated to fund office furniture, video court room capability, computers, law books, etc. Continuing operating expenses (office supplies, telephone bills, postage, office machine rentals, etc.) are estimated at $14,470 per judge team or $173,640 during the first year of operation. During the second year program costs would total $15,194 for one team, and $182,328 in total. Third year operating costs would amount to $15,953 for one team, and $191,436 in total.
In addition, the AOC notes that although not included in the cost projection as it is beyond the projection period, after 2 years, the maintenance of the video court capability is approximately $3,675 per year, or $44,100 for 12 court rooms.
Finally, the AOC stated that for the purpose of this fiscal note, it is assumed that the Judiciary would have to rent 100 percent of the office and courtroom space necessary to facilitate the judge team. Assuming that a 2,000 square foot space per judge team is necessary, at a cost of $25 per square foot, the annual facility rental cost would total $600,000 in the first year, $630,000 in the second year, and $661,500 in the third year after implementation.
Total annual costs to the Judiciary for the twelve new judgeships in FY 2009, FY 2010, and FY 2011 are $6,810,036, $5,718,852 and $5,858,196, respectively.
Centralized Management Office:
The AOC further states that in order to ensure proper intake, case management, record maintenance and management support of the Medical Malpractice Court, a centralized management office, consisting of 13 employees would need to be established, at a cost of $910,059 in FY 2009, $955,562 in FY 2010 and $1,003,340 in FY 2011.
The AOC notes that one-time start-up costs of $120,000 would be generated to fund office furniture, books, computers and filing resources etc. Continuing operating expenses (office supplies, telephone bills, postage, office machine rentals, etc.) are estimated at $50,000 during the first full year of program operation. Second and third year costs would increase to $52,500 and $55,125, respectively.
The AOC notes that for the purpose of this fiscal note, it is assumed that the Judiciary would have to rent 100 percent of the office space necessary to facilitate the centralized management office. Assuming that 8,100 square feet would be required, and assuming a cost of $25 per square foot, the total office space expenses would amount to $202,500 annually. This cost would increase to $212,625 during the second year, and $223,256 during the third year after the bill’s enactment.
Total expenses for the centralized management office in FY 2009, FY 2010, and FY 2011 are $1,282,559, $1,220,687 and $1,281,721, respectively.
On-Line Information System:
To facilitate the accurate recordkeeping and information sharing of the caseload data generated by the proposed Medical Malpractice Court, the AOC states that a new IT system would be required at a cost of $538,296 during the first year of system operation, $1,788,739 during the second year, and $1,878,176 during the third year of system operation. Because a large portion of the second and third year costs would fund one-time system design and programming, the fourth and succeeding years of IT costs would decline to $21,122.
Summary:
The AOC states that total costs of implementing the bill would amount to $8,630,891 in FY 2009, $8,728,278 in FY 2010 and $9,018,093 in FY 2011.
OFFICE OF LEGISLATIVE SERVICES
The Office of Legislative Services concurs with the Executive estimate but notes that the estimate provides a full year cost of operating in FY 2009. Since the State is currently in the midst of Fiscal Year 2009, salary and fringe benefits costs would be less, depending upon the enactment date and date of personnel hires.
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Section: |
Judiciary |
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Analyst: |
Principal Fiscal Analyst |
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Approved: |
David J. Rosen Legislative Budget and Finance Officer |
This fiscal note has been prepared pursuant to P.L.1980, c.67 (C.52:13B-1 et seq.).