MED-MAL CAPACITY INSUFFICIENT:

Pennsylvania Insurance Commissioner Diane Koken has issued a report concluding that there is not sufficient capacity to shift a greater proportion of medical malpractice coverage to the private market from the state Mcare Fund. The report focuses on the ability of the current marketplace to offer an additional $250,000 of coverage for health care providers in the state.

Health care providers in Pennsylvania are required to carry $1 million worth of medical malpractice insurance, the first 50 percent from a private insurance company and the remaining 50 percent from the state’s run Mcare Fund. Current law mandates that the limits be increased unless the insurance commissioner concludes that there is not adequate additional capacity.

The law proposes that, if the market could bear, the primary layer would increase and the Mcare layer would decrease. The law proposed that the next step would be 75 percent–or $750,000–of coverage would come from the private market and 25 percent–or $250,000–would be covered from the state fund. Eventually, if the market had the capacity, malpractice coverage would be provided entirely through the private market.

Koken said that an actuarial study by PricewaterhouseCoopers LLP shows there have been improvements in capacity but not enough to support a ‘step-up’ in basic insurance limits at this point.