Ins 17.25(1)(a)(a) Legislation has been enacted authorizing the commissioner to promulgate a plan to provide health care liability insurance and liability coverage normally incidental to health care liability insurance for risks in this state which are equitably entitled to but otherwise unable to obtain such coverage, or to call upon the insurance industry to prepare plans for the commissioner's approval.
Ins 17.25(1)(b)
(b) Health care liability insurance, liability coverage normally incidental to health care liability insurance or both are not readily available in the voluntary market for the persons specified in sub.
(5) (a).
Ins 17.25(1)(c)
(c) A plan for providing health care liability insurance and liability coverage normally incidental to health care liability insurance should be enacted pursuant to ch.
619, Stats.
Ins 17.25(2)
(2) Purpose. This section implements ss.
619.01 and
619.04, Stats., by establishing procedures and requirements for a mandatory risk sharing plan to provide health care liability insurance coverage and liability coverage normally incidental to health care liability insurance on a self-supporting basis for the persons specified in sub.
(5) (a) and for their employees acting within the scope of their employment and providing health care services. This section is also intended to encourage improvement in reasonable loss prevention measures and to encourage the maximum use of the voluntary market.
Ins 17.25(3)(a)
(a) Each policy of health care liability insurance coverage issued by the plan shall provide occurrence coverage for all of the following:
Ins 17.25(3)(a)1.
1. Providing or failing to provide health care services to a patient.
Ins 17.25(3)(a)2.
2. Peer review, accreditation and similar professional activities in conjunction with and incidental to the provision of health care services, when conducted in good faith by the insured or an employee of the insured.
Ins 17.25(3)(a)3.
3. Utilization review, quality assurance and similar professional activities in conjunction with and incidental to the provision of health care services, when conducted in good faith by the insured or an employee of the insured.
Ins 17.25(3)(b)
(b) Each policy issued by the plan shall also provide for supplemental payments in addition to the limits of liability under par.
(d), including attorney fees, litigation expenses, costs and interest.
Ins 17.25(3)(c)
(c) The health care liability insurance coverage issued by the plan shall exclude coverage for all of the following:
Ins 17.25(3)(c)5.
5. Employment, religious, racial, sexual, age and other unlawful discrimination.
Ins 17.25(3)(c)7.
7. Acts that occurred before the effective date of the policy of which the insured was aware or should have been aware.
Ins 17.25(3)(c)8.
8. Incidents occurring while and insured's license to practice is suspended, revoked, surrendered or otherwise terminated.
Ins 17.25(3)(c)11.
11. Liability of the insured covered by other insurance, such as worker's compensation, automobile, fire or general liability.
Ins 17.25(3)(c)12.
12. Liability arising out of the ownership, operation or supervision by the insured of a hospital, nursing home or other health care facility or business enterprise.
Ins 17.25(3)(c)13.
13. Liability of others assumed by the insured under a contract or agreement.
Ins 17.25(3)(d)
(d) The maximum limits of liability for coverage under par.
(a) are the following:
Ins 17.25(3)(d)1.
1. For all occurrences before July 1, 1987, $200,000 for each occurrence and $600,000 per year for all occurrences in any one policy year.
Ins 17.25(3)(d)2.
2. For occurrences on or after July 1, 1987, and before July 1, 1988, $300,000 for each occurrence and $900,000 for all occurrences in any one policy year.
Ins 17.25(3)(d)3.
3. Except as provided in subds.
4. and
5., for occurrences on or after July 1, 1988, and before July 1, 1997, $400,000 for each occurrence and $1,000,000 for all occurrences in any one policy year.
Ins 17.25(3)(d)4.
4. Except as provided in subd.
5., for occurrences on or after July 1, 1997, $1,000,000 for each occurrence and $3,000,000 for all occurrences in any one policy year.
Ins 17.25(3)(d)5.
5. For podiatrists licensed under ch.
448, Stats., for occurrences on and after November 1, 1989, $1,000,000 for each occurrence and $1,000,000 for all occurrences in any one policy year.
Ins 17.25(3)(e)
(e) The plan may also issue liability coverage normally incidental to health care liability insurance including all of the following:
Ins 17.25(3)(f)
(f) The maximum limits of liability for coverage under par.
(e) are $1,000,000 per claim and $3,000,000 aggregate for all claims in any one policy year.
Ins 17.25(5)
(5) Eligibility for plan coverage. All of the following are eligible for insurance under the plan:
Ins 17.25(5)(a)
(a) A medical or osteopathic physician or podiatrist licensed under ch.
448, Stats.
Ins 17.25(5)(d)
(d) A partnership comprised of, and organized and operated in this state for the primary purpose of providing the medical services of, physicians, podiatrists, nurse anesthetists, nurse midwives, nurse practitioners or cardiovascular perfusionists.
Ins 17.25(5)(e)
(e) A corporation or general partnership organized and operated in this state for the primary purpose of providing the medical services of physicians, podiatrists, nurse anesthetists, nurse midwives, nurse practitioners or cardiovascular perfusionists.
Ins 17.25(5)(f)
(f) An operational cooperative sickness care plan organized under ss.
185.981 to
185.985, Stats., which directly provides services through salaried employees in its own facility.
Ins 17.25(5)(g)
(g) An accredited teaching facility conducting approved training programs for medical or osteopathic physicians licensed or to be licensed under ch.
448, Stats., or for nurses licensed or to be licensed under ch.
441, Stats.
Ins 17.25(5)(i)
(i) An entity operated in this state that is an affiliate of a hospital and that provides diagnosis or treatment of, or care for, patients of the hospital.
Ins 17.25(5)(j)
(j) A nursing home, as defined in s.
50.01 (3), Stats., whose operations are combined as a single entity with a hospital, whether or not the nursing home operations are physically separate from the hospital operations.
Ins 17.25(5)(k)
(k) A health care facility owned or operated by a county, city, village or town in this state, or by a county department established under s.
51.42 or
51.437, Stats., if the facility would otherwise be eligible for coverage under this subsection.
Ins 17.25(5)(L)
(L) A corporation organized to manage approved training programs for medical or osteopathic physicians licensed under ch.
448, Stats.
Ins 17.25(6)(a)1.
1. “Personal injury liability insurance" means any insurance coverage against loss by the personal injury or death of any person for which loss the insured is liable. “Personal injury liability insurance" includes the personal injury liability component of multi-peril policies, but does not include steam boiler insurance authorized under s.
Ins 6.75 (2) (a), worker's compensation insurance authorized under s.
Ins 6.75 (2) (k) or medical expense coverage authorized under s.
Ins 6.75 (2) (d) or
(e).
Ins 17.25(6)(a)2.
2. “Premiums written" means gross direct premiums less return premiums, dividends paid or credited to policyholders and the unused or unabsorbed portions of premium deposits, with respect to personal injury liability insurance covering insureds or risks residing or located in this state.
Ins 17.25(6)(b)1.1. Each insurer authorized in this state to write personal injury liability insurance, except a town mutual organized under ch.
612, Stats., is a member of the plan.
Ins 17.25(6)(b)2.
2. An insurer's membership in the plan terminates if the insurer is no longer authorized to write personal injury liability insurance in this state. The effective date of termination shall be the last day of the plan's current fiscal year. A terminated insurer shall continue to be governed by this subsection until it completes all of its obligations under the plan.
Ins 17.25(6)(b)3.
3. Subject to the approval of the commissioner, the board may charge a reasonable annual membership fee, not to exceed $50.00.
Ins 17.25(6)(c)
(c) If the funds available to the plan at any time are not sufficient for the sound financial operation of the plan, the board shall assess the members an amount sufficient to remedy the insufficiency. Each member shall contribute according to the proportion that that member's premiums written during the preceding calendar year bears to the aggregate premiums written by all members during the preceding calendar year. The amounts of premiums written shall be determined on the basis of the annual statements and other reports filed by the members with the commissioner. Assessments are subject to any credit plan developed under sub.
(8) (a) 4. When the amount of the assessment is recouped under s.
619.01 (1) (c) 2., Stats., each member shall be reimbursed the amount of that member's assessment.
Ins 17.25(6)(d)
(d) The board shall report to the commissioner the name of any member that fails to pay within 30 days any assessment levied under par.
(c).
Ins 17.25(7)
(7) Board meetings; quorum. The board shall meet as often as required to perform the general duties of supervising the administration of the plan, or at the call of the commissioner. Seven members of the board shall constitute a quorum.
Ins 17.25(8)
(8) Powers and duties of the board. The board may do any of the following:
Ins 17.25(8)(a)1.1. Invest, borrow and disburse funds, budget expenses, levy assessments and cede and assume reinsurance.
Ins 17.25(8)(a)2.
2. Appoint a manager or one or more agents to perform the duties designated by the board.
Ins 17.25(8)(a)3.
3. Appoint advisory committees of interested persons, not limited to members of the plan, to advise the board in the fulfillment of its duties and functions.
Ins 17.25(8)(a)4.
4. Develop an assessment credit plan subject to the approval of the commissioner, by which a member of the plan receives a credit against an assessment levied under sub.
(6) (c), based on voluntarily written health care liability insurance premiums in this state.
Ins 17.25(8)(a)5.
5. Take any action consistent with law to provide the appropriate examining boards or the department of health services with appropriate claims information.
Ins 17.25(8)(a)6.
6. Perform any other act necessary or incidental to the proper administration of the plan.
Ins 17.25(8)(b)1.
1. Develop rates, rating plans, rating and underwriting rules, rate classifications, rate territories and policy forms for the plan.
Ins 17.25(8)(b)2.
2. Ensure that all policies written by the plan are separately coded so that appropriate records may be compiled for purposes of calculating the adequate premium level for each classification of risk, and performing loss prevention and other studies of the operation of the plan.
Ins 17.25(8)(b)3.
3. Subject to the approval of the commissioner, determine the eligibility of an insurer to act as a servicing company to issue and service the plan's policies. If no qualified insurer elects to be a servicing company, the board shall assume these duties on behalf of member companies.
Ins 17.25(8)(b)4.
4. Enter into agreements and contracts as necessary for the execution of this section.
Ins 17.25(8)(b)5.
5. By May 1 of each year, report to the members of the plan and to the standing committees on insurance in each house of the legislature summarizing the activities of the plan in the preceding calendar year.
Ins 17.25(10)(a)
(a) Any person specified in sub.
(5) may submit an application for insurance by the plan directly or through any licensed agent. Each application shall request coverage for the applicant's partnership or corporation, if any, and for the applicant's employees acting within the scope of their employment and providing health care services, unless the partnership, corporation or employees are covered by other professional liability insurance.
Ins 17.25(10)(c)
(c) Within 8 business days after receiving an application, the plan shall notify the applicant whether the application is accepted, rejected or held pending further investigation. Any applicant rejected by the plan may appeal the decision to the board as provided in sub.
(16).
Ins 17.25(10)(cm)
(cm) The board may authorize retroactive coverage by the plan for a health care provider, as defined in s.
655.001 (8), Stats., if the provider submits a timely request for retroactive coverage showing that the failure to procure coverage occurred through no fault of the provider and despite the fact that the provider acted reasonably and in good faith. The provider shall furnish the board with an affidavit describing the necessity for the retroactive coverage and stating that the provider has no notice of any pending claim alleging malpractice or knowledge of a threatened claim or of any occurrence that might give rise to such a claim.
Ins 17.25(10)(d)
(d) If the application is accepted, the plan shall deliver a policy to the applicant upon payment of the premium.
Ins 17.25(12)(a)2.
2. Rates shall be calculated in accordance with generally accepted actuarial principles, using the best available data.
Ins 17.25(12)(a)3.
3. Rates shall be calculated on a basis which will make the plan self-supporting but may not be excessive. Rates shall be presumed excessive if they produce long-term excess funds over the total of the plan's unpaid losses, including reserves for losses incurred but not yet reported, unpaid loss adjustment expenses, additions to the surplus established under s.
619.01 (1) (c) 2., Stats., and s.
Ins 51.80 (3) and
(4), the premium assessment under s.
619.01 (8m), Stats., and other expenses.
Ins 17.25(12)(a)4.
4. The board shall annually determine if the plan has accumulated excess funds as described under subd.
3. and, if so, the board shall return the excess funds to the insureds by means of refunds or prospective rate decreases according to a distribution method and formula established by the board.
