ASSEMBLY, No. 2807

STATE OF NEW JERSEY

214th LEGISLATURE

 

INTRODUCED JUNE 10, 2010

 


 

Sponsored by:

Assemblyman  HERB CONAWAY, JR.

District 7 (Burlington and Camden)

Assemblyman  JACK CONNERS

District 7 (Burlington and Camden)

 

 

 

 

SYNOPSIS

     Extends Medical Malpractice Liability Insurance Premium Assistance Fund and collection of annual surcharges for 5 years.

 

CURRENT VERSION OF TEXT

     As introduced.

  


An Act concerning the Medical Malpractice Liability Insurance Premium Assistance Fund, amending and supplementing P.L.2004, c.17, and repealing section 29 of P.L.2004, c.17.

 

     Be It Enacted by the Senate and General Assembly of the State of New Jersey:

 

     1.    Section 27 of P.L.2004, c.17 (C.17:30D-29) is amended to read as follows:

     27.  a.  There is established a Medical Malpractice Liability Insurance Premium Assistance Fund within the Department of the Treasury as a nonlapsing, revolving fund.

     b.    The fund shall be comprised of the following revenue:

     (1)   an annual surcharge of $3 per employee for all employers who are subject to the New Jersey "unemployment compensation law," R.S.43:21-1 et seq., collected by the comptroller for the New Jersey Unemployment Compensation Fund and paid over to the State Treasurer for deposit in the fund annually, as provided by the commissioner, which surcharge may, at the option of the employer, be treated as a payroll deduction to each covered employee;

     (2)   an annual charge of $75 to be imposed by the State Board of Medical Examiners on every physician and podiatrist licensed by the board pursuant to the provisions of R.S.45:9-1 et seq., collected by the board and remitted to the State Treasurer for deposit into the fund;

     (3)   an annual charge of $75 to be imposed by the State Board of Chiropractic Examiners on every chiropractor licensed by the board pursuant to the provisions of P.L.1989, c.153 (C.45:9-41.17 et seq.), collected by the board  and remitted to the State Treasurer for deposit into the fund;

     (4)   an annual charge of $75 to be imposed by the New Jersey State Board of Dentistry on every dentist licensed pursuant to the provisions of R.S.45:6-1 et seq., collected by the board and remitted to the State Treasurer for deposit into the fund;

     (5)   an annual charge of $75 to be imposed by the New Jersey State Board of Optometrists on every optometrist licensed by the board pursuant to the provisions of R.S.45:12-1 et seq., collected by the board and remitted to the State Treasurer for deposit into the fund; and

     (6)   an annual fee of $75 to be assessed by the State Treasurer and payable by each person licensed to practice law in this State, for deposit into the fund.

     The provisions of paragraphs (2) through (5) of this subsection shall not apply to physicians, podiatrists, chiropractors, dentists or optometrists who:  are statutorily or constitutionally barred from the practice of their respective profession; can show that they do not maintain a bona fide office for the practice of their profession in this State; are completely retired from the practice of their profession; are on full-time duty with the armed forces, VISTA or the Peace Corps and not engaged in practice; or have not practiced their profession for at least one year.

     The provisions of paragraph (6) of this subsection shall not apply to attorneys who:  are constitutionally or statutorily barred from the practice of law; can show that they do not maintain a bona fide office for the practice of law in this State; are completely retired from the practice of law; are on full-time duty with the armed forces, VISTA or the Peace Corps and not engaged in practice; are ineligible to practice law because they have not made their New Jersey Lawyers' Fund for Client Protection payment; or have not practiced law for at least one year.

     c.     The State Treasurer shall deposit all moneys collected by him pursuant to this section into the fund.  Monies credited to the fund may be invested in the same manner as assets of the General Fund and any investment earnings on the fund shall accrue to the fund and shall be available subject to the same terms and conditions as other monies in the fund.

     d.    The fund shall be administered by the Department of Banking and Insurance in accordance with the provisions of P.L.2004, c.17 (C.2A:53A-37 et al.).

     e.     The monies in the fund are specifically dedicated and shall be utilized exclusively for the following purposes:

     (1)   $17 million shall be allocated annually for the purpose of providing relief towards the payment of medical malpractice liability insurance premiums to health care providers in the State who have experienced or are experiencing a liability insurance premium increase in an amount as established by the commissioner by regulation and meet the criteria established pursuant to section 28 of P.L.2004, c.17 (C.17:30D-30);

     (2)   $6.9 million shall be allocated annually to the Health Care Subsidy Fund established pursuant to section 8 of P.L.1992, c.160 (C.26:2H-18.58) for the purpose of providing payments to hospitals in accordance with the formula used for the distribution of charity care subsidies that are provided pursuant to [P.L.1992, c.160 (C.26:2H-18.51 et al.)] section 3 of P.L.2004, c.113 (C.26:2H-18.59i);

     (3)   $1 million shall be allocated annually for a student loan expense reimbursement program for  obstetrician/gynecologists, to be established pursuant to section [29 of P.L.2004, c.17 (C.18A:71C-49)] 3 of P.L.  , c.  (C.    )(pending before the Legislature as this bill); and

     (4)   $1.2 million shall be allocated annually to the Division of Medical Assistance and Health Services in the Department of Human Services for the [purposes provided in section 30 of P.L.2004, c.17 (C.30:4J-7)] NJ FamilyCare Program established pursuant to P.L.2005, c.156 (C.30:4J-8 et seq.).

     f.     The fund and the annual surcharge, charges and fee provided for in subsection b. of this section shall [expire three years after the effective date of P.L.2004, c.17 (C.2A:53A-37 et al.)] be reestablished on the effective date of P.L.  , c. (pending before the Legislature as this bill), and shall expire five years after the effective date of P.L., c. .

     g.     The commissioner, in consultation with the Commissioner of Health and Senior Services, shall adopt rules and regulations pursuant to the "Administrative Procedure Act," P.L.1968, c.410 (C.52:14B-1 et seq.), to carry out the purposes of sections 26 through [29] 28 of P.L.2004, c.17 (C.17:30D-28 through C.17:30D-30 [and C.18A:71C-49]) and section 3 of P.L.  , c.  (C.   ) (pending before the Legislature as this bill); except that, notwithstanding any provision of P.L.1968, c.410 to the contrary, the commissioner may adopt, immediately upon filing with the Office of Administrative Law, such regulations as the commissioner deems necessary to implement the provisions of sections 26 through [29] of P.L.2004, c.17 (C.17:30D-28 through C.17:30D-30 [and C.18A:71C-49]) and section 3 of P.L.  , c.  (C.   )(pending before the Legislature as this bill), which shall be effective for a period not to exceed six months and may thereafter be amended, adopted or readopted by the commissioner in accordance with the requirements of P.L.1968, c.410.

(P.        L.2004, c.17, s.27)

 

     2.    Section 28 of P.L.2004, c.17 (C.17:30D-30) is amended to read as follows:

     28.  a.  In order to carry out the purposes of section 27 of P.L.2004, c.17 (C.17:30D-29), the commissioner shall, at a minimum:

     (1)   establish a program to provide medical malpractice liability insurance premium subsidies to health care providers from monies that are contained in the fund;

     (2)   establish a methodology and procedures for determining eligibility for, and providing subsidies from, the fund;

     (3)   maintain confidential records on each health care provider who receives assistance from the fund;

     (4)   take all necessary action to recover the cost of the subsidy provided to a health care provider that the commissioner determines to have been incorrectly provided; and

     (5)   provide for subsidies to all practitioners who are members of specialties and subspecialties who qualify for relief under subsection b. of this section, including those whose professional liability insurance protection is provided by hospital funding supplemented by purchased commercial insurance coverage.

     b.    The commissioner shall certify classes of  practitioners by specialty and subspecialty for each type of practitioner, whose average medical malpractice premium, as a class, on or after December 31, [2002] 2009, is in excess of an amount per year as determined by the commissioner by regulation.  In certifying classes eligible for the subsidy, the commissioner, in consultation with the Commissioner of Health and Senior Services, may also consider if access to care is threatened by the inability of a significant number of practitioners, as applicable, in a particular specialty or subspecialty, to continue practicing in a geographic area of the State.

     (1)   In order to be eligible for a subsidy from the fund, a practitioner shall have received a medical malpractice liability insurance premium increase in an amount as determined by the commissioner by regulation, for one or more of the following: upon renewal on or after January 1, [2004] 2010, from the amount paid by that practitioner in calendar year [2003] 2009; upon renewal on or after January 1, [2005] 2011, from the amount paid by that practitioner in calendar year [2004] 2010; [and] upon renewal on or after January 1, [2006] 2012, from the amount paid by that practitioner in calendar year [2005] 2011; upon renewal on or after January 1, 2013, from the amount paid by that practitioner in calendar year 2012; and upon renewal on or after January 1, 2014, from the amount paid by that practitioner in calendar year 2013; or

     (2)   In the case of a health care provider providing professional liability insurance protection through self-insured hospital funding supplemented with purchased commercial insurance coverage, in order to be eligible for a subsidy from the fund, that provider shall have increased its total professional liability funding obligation in an amount as determined by the commissioner by regulation, for one or more of the following:  upon renewal on or after January 1, [2004] 2010, from the professional liability funding obligation paid by that provider in calendar year [2003] 2009; upon renewal on or after January 1, [2005] 2011, from the professional liability funding obligation paid by that provider in calendar year [2004] 2010; [and] upon renewal on or after January 1, [2006] 2012, from the professional liability funding obligation paid by that provider in calendar year [2005] 2011; upon renewal on or after January 1, 2013, from the professional liability funding obligation paid by that provider in calendar year 2012; and upon renewal on or after January 1, 2014, from the professional liability funding obligation paid by that provider in calendar year 2013.

     (3)   The amount of the subsidy shall be an amount, as determined by the commissioner by regulation, of the increase from the preceding year's premium or self-insured professional liability funding obligation; except that no health care provider shall receive a subsidy in any year that is greater than an amount as determined by the commissioner by regulation.

     c.     A practitioner who has been subject to a disciplinary action or civil penalty by the practitioner's respective licensing board pursuant to section 8, 9 or 12 of P.L.1978, c.73 (C.45:1-21, 22 or 25), when that action or penalty relates to the  practitioner's provision of, or failure to provide, treatment or care to a patient, is not eligible for a subsidy from the fund.

     d.    (1)  A practitioner who receives a subsidy from the fund shall be required to practice in that practitioner's specialty or subspecialty in this State for a period of at least two years after receipt of the subsidy.

     (2)   A practitioner who fails to comply with the provisions of paragraph (1) of this subsection shall be required to repay to the commissioner the amount of the subsidy, in whole or in part as determined by the commissioner.

     e.     The commissioner may waive the criteria for eligibility for a subsidy established pursuant to this section, if the commissioner determines that access to care for a particular specialty is threatened  because of an inability of a sufficient number of practitioners in that specialty or subspecialty to practice in a geographic area of the State.

     f.     The State Board of Medical Examiners, the State Board of Chiropractic Examiners, the New Jersey State Board of Dentistry and the New Jersey Board of Nursing shall each provide to the commissioner, on a quarterly basis, the names of the practitioners who have been subject to a disciplinary action or civil penalty by the practitioner's respective licensing board.

     g.     For the purposes of section [29 of P.L.2004, c.17 (C.18A:71C-49)] 3 of P.L.  , c. (C.   )(pending before the Legislature as this bill), the commissioner, in consultation with the State Board of Medical Examiners, shall provide to the Higher Education Student Assistance Authority the names of obstetrician/gynecologists licensed by the board who may qualify for the student loan reimbursement program established pursuant to [P.L.2004, c.17] P.L.  , c. (pending before the Legislature as this bill). A physician who has been subject to a disciplinary action or civil penalty by the board, as provided in subsection c. of this section, shall not be eligible for the program.

(cf: P.L.2004, c.17, s.28)

 

     3.    (New section)  a.  There is established a student loan expense reimbursement program within the Higher Education Student Assistance Authority for obstetrician/gynecologists who agree to practice in State designated underserved areas as established pursuant to section 1 of P.L.1999, c.46 (C.18A:71C-35). Any loans provided through the NJCLASS Loan Program pursuant to P.L.1999, c.46 (C.18A:71C-21 et seq.) or a student loan program of the federal government shall be eligible for reimbursement under this program.

     The authority shall implement the program in consultation with the Commissioners of Banking and Insurance and Health and Senior Services and the State Board of Medical Examiners.

     b.    (1) An obstetrician/gynecologist who receives a payment under the student loan expense reimbursement program shall be required to practice as an obstetrician/gynecologist in an underserved area in this State for a period of at least four years after receipt of the payment.

     (2)   An obstetrician/gynecologist who fails to comply with the provisions of paragraph (1) of this subsection shall be required to repay to the Higher Education Student Assistance Authority the amount of the payment, in whole or in part as determined by the authority.

     c.     The authority shall adopt rules and regulations, pursuant to the “Administrative Procedure Act,” P.L.1968, c.410 (C.52:14B-1 et seq.), to effectuate the purposes of this section, including, but not limited to:  eligibility for the program, procedures for application, selection of participants, establishment and nullification of contracts established with participants under the program, and reports to the program by participants.

 

     4.    The following are repealed:

     Section 29 of P.L.2004, c.17 (C.18A:71C-49); and

     Section 30 of P.L.2004, c.17 (C.30:4J-7).

 

     5.    This act shall take effect on the 30th day following enactment.

 

 

STATEMENT

 

     This bill extends the Medical Malpractice Liability Insurance Premium Assistance Fund for five years and reestablishes the collection of annual surcharges for the fund for the five-year period.

     The primary purpose of the fund is to provide medical malpractice liability insurance premium subsidies to health care providers who, as a class of providers, are most severely impacted by high medical malpractice premium rates.  In addition, monies from the fund are allocated for various health care purposes, including funds: to the Health Care Subsidy Fund for charity care subsidies to hospitals, to the NJ FamilyCare Program, and to provide student loan expense reimbursement for certain obstetrician/gynecologists.

     The surcharges apply to all employers subject to the “unemployment compensation law,” ($3 per employee each year), and to practicing physicians, podiatrists, chiropractors, dentists, optometrists, and attorneys licensed in this State ($75 each year).

     The bill repeals sections 29 and 30 of P.L.2004, c.17.  The provisions of section 29, concerning student loan expense reimbursement for certain obstetricians/gynecologists, had expired three years after the effective date of P.L.2004, c.17, and this bill reenacts those provisions as section 3 of the bill.  The provisions of section 30 concerning NJ FamilyCare coverage for certain pregnant women whose income is up to 100% of the federal poverty level, are no longer necessary since eligibility for Medicaid was expanded in 2005 to cover parents and children whose income is up to 133% of the federal poverty level.  The monies from the Medical Malpractice Liability Insurance Premium Assistance Fund that had been allocated in 2004 to the coverage of pregnant women will now be allocated to the NJ FamilyCare Program.