BILL ANALYSIS
SB 1031
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Date of Hearing: June 29, 2010
ASSEMBLY COMMITTEE ON BUSINESS, PROFESSIONS AND CONSUMER
PROTECTION
Mary Hayashi, Chair
SB 1031 (Corbett) - As Amended: May 28, 2010
SENATE VOTE : 35-0
SUBJECT : Medical malpractice insurance: volunteer physicians
and surgeons.
SUMMARY : Creates the Volunteer Insured Physicians (VIP)
Program within the Medical Board of California (MBC) to provide
specified medical malpractice insurance coverage to physicians
providing voluntary, uncompensated care to patients pursuant to
a contract with a qualified health care entity (QHCE), as
defined. Specifically, this bill :
1)Provides that a licensee who wants to provide voluntary,
uncompensated care to low-income patients, but who does not
have medical professional liability insurance may submit a
voluntary service application to the MBC for coverage under
the VIP Program.
2)Requires the MBC, when it receives an application for
licensure in order to offer voluntary services, to assess
whether the applicant qualifies for coverage under the VIP
Program.
3)Permits a licensee who already has standard medical
professional liability insurance coverage for his or her
regular practice but is not covered for volunteer service to
submit a voluntary service application to participate in the
VIP Program and verification that his or her liability policy
does not cover voluntary services.
4)Requires the MBC to review a voluntary service applicant to
determine if the applicant meets the criteria to participate
in the VIP Program by holding a license in good standing and
having no record of disciplinary action by the MBC or any
other regulatory board.
5)Provides that eligibility for the VIP Program shall be
reassessed by the MBC during each license renewal cycle.
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6)Provides that licensees approved by the MBC for participation
in the VIP Program may enter into a voluntary service
agreement with the MBC and a QHCE that acknowledges the terms
of the VIP Program and transfers responsibility from the
volunteer physician to the state for medical professional
liability insurance, including premiums, defense and indemnity
costs for voluntary, uncompensated medical care provided in
accordance with an executed and signed voluntary service
contract between the volunteer physician and the QHCE and in
compliance with the terms of the VIP Program.
7)Requires volunteer physicians participating in the VIP Program
to agree to limit the scope of volunteer medical care to
primary care medical services.
8)Specifies the provisions of the voluntary service contract
between the volunteer physician and the QHCE.
9)Provides that a volunteer physician insured under the VIP
Program shall not change or affect the laws applicable to any
claims arising from medical services rendered.
10)Requires that when a volunteer physician covered by the VIP
Program receives notice or otherwise obtains knowledge that a
claim of professional medical negligence has been or may be
filed, the volunteer physician must immediately notify the VIP
Program or the contracted liability carrier.
11)Provides that all costs for administering the VIP Program,
including the cost of medical professional liability insurance
shall be paid from license fees deposited into the Contingent
Fund of the MBC.
12)Requires the MBC to annually report to the Legislature on the
efficiency, access and treatment outcomes of the care provided
through the VIP Program. The report shall include the
following:
a) Number of injuries and deaths reported;
b) Total of all premiums paid;
c) Number of claims made annually;
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d) Amount of all indemnity payments made;
e) Cost of defense provided; and,
f) Administrative costs.
13)Sunsets the provisions of this bill on January 1, 2016.
14)Defines the following terms:
a) "Licensee" to mean the holder of a current physician and
surgeon's certificate;
b) "Patient" to mean a person who is eligible for free or
discounted services at a QHCE;
c) "QHCE" to mean a community clinic as defined, a county
health department, a hospital district, a hospital, a
clinic owned and operated by a governmental entity that
provides primary care to low-income patients;
d) "Voluntary service agreement" to mean an agreement
executed between the MBC, a licensee, and a QHCE that
authorizes the QHCE to enter into a voluntary service
contract with the licensee;
e) "Voluntary service application" to mean the written
application developed by the MBC that a licensee must
complete and submit in order to be considered for
participation in the VIP Program;
f) "Voluntary service contract" to mean an agreement
executed between a licensee and a QHCE that authorizes the
licensee to deliver health care services to patients as an
agent of the QHCE on a voluntary, uncompensated basis; and,
g) "Volunteer physician" to mean a licensee who provides
primary care medical services in California without
receiving monetary or material compensation and
participates in the VIP Program.
EXISTING LAW :
1)Establishes the federal Public Health Service Act, the Health
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Insurance Portability and Accountability Act, and the Clinic
Federal Tort Claims Act (FTCA) Medical Malpractice Program to
provide medical malpractice liability protection to employees
of federally funded and approved community health centers
(free clinics).
2)Establishes the federal Volunteer Medical Act to provide
immunity to health care providers in limited circumstances,
when the care is provided in conjunction with a non-profit,
the non-profit cannot be reimbursed from a third-party,
including Medicare and Medicaid, and the non-profit cannot
charge for services rendered.
3)Establishes the FTCA, which authorizes the United States. to
bring tort suits against itself and be liable for injuries
caused by the negligent or wrongful act or omission of any
federal employee acting within the scope of his or her
employment.
4)Allows the MBC to waive the licensing fee for a physician and
surgeon residing in California who certifies that the issuance
or the renewal of their license is for the sole purpose of
providing voluntary, unpaid service.
5)Establishes the Volunteer Protection Act to provide all
volunteers of nonprofits and governmental entities with
limited liability protection against civil action lawsuits.
Nonprofits and governmental entities may still be liable.
FISCAL EFFECT : Unknown
COMMENTS :
Purpose of this bill . According to the author's office, "It has
long been recognized that one of the challenges and potential
barriers to physician volunteerism is the concern about medical
malpractice liability associated with providing uncompensated
care. The federal government and 43 states have established
programs to promote volunteerism by physicians. California is
one of only seven states in the nation without a program to
cover physicians that provide unpaid, voluntary services.
"SB 1031 grants the MBC the ability to create and implement the
VIP Program. The program will provide medical malpractice
insurance for physicians who provide voluntary unpaid services
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to medically underserved populations in California."
Background . Current law extends medical malpractice protection
for volunteer health professionals who provide uncompensated
services in a free clinic under the FTCA. These volunteer
health professionals are sponsored by the free clinic and deemed
a federal employee for the purpose of receiving FTCA medical
malpractice coverage. FTCA free clinics include health centers
that serve the medically underserved, migratory and seasonal
agricultural workers, the homeless, and public housing
residents. These free clinics can offer primary health services
that include family medicine, internal medicine, pediatrics,
obstetrics, gynecology, diagnostic laboratory and radiological
services, emergency medical services, pharmaceutical services,
and preventative health services.
To apply for FTCA approval, clinics must submit applications on
behalf of their volunteer health care professionals to the
Department of Health and Human Services, the Health Resources
and Services Administration, and the Bureau of Primary Health
Care.
FTCA-approved free clinics provide volunteer health care
professionals with immunity from medical malpractice lawsuits
resulting from the performance of clinical medical, dental or
scope of work functions at the free clinic. Under FTCA,
volunteer free clinic health care professionals are considered
federal employees with the federal government acting as their
primary insurer.
A patient who alleges acts of medical malpractice by a
FTCA-approved free clinic cannot sue the clinic or the provider
directly, but must instead file the claim against the U.S.
Government. These claims are reviewed and/or litigated by the
U.S. Department of Health and Human Services Office of the
General Counsel and the Department of Justice.
The medical malpractice insurance of non-profits, hospitals,
school districts, the University of California (UC), and local
governments are outlined below.
Community Non-Profits & Events
Clinics that are ineligible as a free clinic under FTCA can
purchase their own medical malpractice insurance to cover both
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employee and volunteer health care professionals. Similarly,
organizations that host events (e.g., Red Cross) requiring
health care services can provide liability protection to
volunteer health care professionals under an umbrella insurance
policy. Under the federal Volunteer Protection Act of 1997,
volunteers are immune from personal injury lawsuits, although
non-profits overseeing those volunteers are not.
Hospital Districts
According to the Robert Wood Johnson Foundation, "Physicians
usually buy their insurance from a commercial company or a
physician-owned mutual company, either individually or through a
group practice. Hospitals and other health care facilities
purchase their own insurance, and hospitals that directly employ
physicians typically buy a policy that covers both the hospital
and the medical staff. Physicians employed by the federal
government don't buy insurance; if they are sued, the suit is
brought against the federal government, which insures itself.
Some state-employed physicians receive coverage from the state."
School Districts
Schools are required to self-insure or purchase liability as
required under the Education Code, and will self-insure or seek
coverage through a joint powers group providing liability
insurance. School districts generally do not purchase medical
malpractice insurance because they rarely employ physicians.
School nurses usually purchase their own medical malpractice
insurance for coverage during the course of their employment
because a school's liability coverage may not extend to the
health care professional if a claim is made against the
educational institution.
UC
UC is self-funded for its medical malpractice liability. Each
UC medical school and medical center pays to a central plan and
is limited in coverage options by law, UC policy and excess
insurance. UC provides defense and indemnity protection when UC
physicians and non-salaried faculty provide care to the
underprivileged within the scope of UC approvals. UC provides
care to the underprivileged through its hospitals and clinics
and through volunteer clinical faculty and resident coverage to
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clinics owned and operated by other entities.
State & Local Governments
Cities do not generally employ physicians, but counties may. In
that instance, the county health department would provide the
coverage.
Good Samaritan Laws
Generally, outside of clinics or organized and sponsored events,
the Good Samaritan law will generally cover health care
professionals who administer services during an emergency,
including obstetrics at a hospital emergency room, high school
or college athletic events, a state of war, or other state or
local emergency.
Support . According to the co-sponsor, the MBC, "This bill would
create the VIP Program within the MBC. The program would
provide medical malpractice coverage to volunteer physicians who
are providing uncompensated medical care to low-income or
underserved patients. Currently, there is a shortage of health
care providers in California. Many physicians who would like to
volunteer their services are unable to do so due to the cost of
medical malpractice insurance. Providing this insurance would
undoubtedly encourage more physicians to volunteer their time
and services to communities and consumers in need."
According to the co-sponsor, the California Medical Association,
"In the absence of a sufficient supply of physicians providing
services at free community clinics and health centers, patients
without the ability to pay for medical care would most likely
either go without care or seek services at an emergency room.
If the patient foregoes medical care, it is likely that at some
point, the problem will escalate and the patient will have to
seek care at an emergency room. Within the emergency room
setting, the cost of care will be shifted to the government who
is likely to pay for part of the costs, to physicians who end up
providing involuntary uncompensated care, to the hospital, and
to other paying patients when costs are increased to cover any
operating shortfall. So, it is clearly in the public interest
to facilitate the provision of primary care services in clinics
to patients who cannot afford to pay."
Related Legislation . AB 2699 (Bass) of 2010 exempts from
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licensure a health care practitioner licensed in another state
who offers or provides health care services on a short-term
voluntary basis, as specified, and without charge to the
recipient or a third party on behalf of the recipient, in
association with a sponsoring entity that registers and provides
specified information to a designated local agency. This bill
is currently pending in the Senate Business, Professions and
Economic Development Committee.
AB 1570 (Salas) of 2010 creates the Volunteer Insured Dentists
Program, to be administered by the California Dental Board and
provides specified malpractice insurance coverage to volunteer
dentists providing uncompensated care to low-income patients
pursuant to a contract with a QHCE, as defined. This bill is
currently pending in the Senate Transportation and Housing
Committee.
Previous Legislation . AB 2439 (De La Torre), Chapter 640,
Statutes of 2008, required the MBC to charge physicians and
surgeons an additional $25 as part of their initial or renewal
license fees to support the Steven M. Thompson Physician Corps
Loan Repayment Program, which provides loan assistance for
physicians who agree to practice in geriatric care settings.
AB 2342 (Nakanishi), Chapter 276, Statutes of 2006, required the
MBC, in conjunction with the Health Professions Education
Foundation, to study the issue of providing medical malpractice
insurance to physicians who provide voluntary, unpaid services
and report its findings to the Legislature on or before January
1, 2008. The report was released on December 31, 2008. The
study specifically focused on the options and potential costs of
providing medical malpractice coverage or funding for medical
malpractice coverage to licensed physicians and surgeons who
volunteer their time to provide uncompensated medical services
to patients.
AB 621 (Nakanishi) of 2003 would have created within the
Department of Health Services, the Physicians and Surgeons
Liability Insurance Pilot Program, to purchase liability
insurance for physicians who are eligible under existing law for
waiver of license renewal fees if the sole purpose of license
renewal is to provide voluntary, unpaid services to specified
agencies. This bill was held in the Senate Judiciary Committee.
REGISTERED SUPPORT / OPPOSITION :
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Support
California Medical Association (sponsor)
Medical Board of California (sponsor)
American Medical Society for Sports Medicine
California Academy of Family Physicians
Consumer Attorneys of California
Opposition
None on file.
Analysis Prepared by : Joanna Gin / B.,P. & C.P. / (916)
319-3301