Chapter Ins 17

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) (b) The board shall do all of the following:

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) (10) Application for insurance.

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)(b) (b) The plan may bind coverage.

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) (12) Rates, rate classifications and filings.

Ins 17.25(12)(a) (a)

Ins 17.25(12)(a)1. 1. In developing rates and rate classifications, as provided under sub. (8) (b) 1., the board shall ensure that the plan complies with ss. 619.01 (1) (c) 2. and 619.04 (5) and ch. 625, Stats.

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.

Ins 17.25(12)(a)5. 5.

Ins 17.25(12)(a)5.a. a. In establishing the plan’s rates, the board shall use loss and expense experience in this state to the extent it is statistically credible supplemented by relevant data from outside this state including, but not limited to, data provided by other insurance companies, rate service organizations or governmental agencies.

Ins 17.25(12)(a)5.b. b. The board shall annually review the plan’s rates using the experience of the plan, supplemented first by the experience of coverage provided in this state by other insurers and, to the extent necessary for statistical credibility, by relevant data from outside this state.

Ins 17.25(12)(a)6. 6. The loss and expense experience used in establishing and revising rates shall be adjusted to indicate as nearly as possible the loss and expense experience which will emerge on policies issued by the plan during the period for which the rates were being established. For this purpose loss experience shall include paid and unpaid losses, a provision for incurred but not reported losses and both allocated and unallocated loss adjustment expenses, giving consideration to changes in estimated costs of unpaid claims and to indications of trends in claim frequency, claim severity and level of loss expense.

Ins 17.25(12)(a)7. 7. Expense provisions included in the plan’s rates shall reflect reasonable prospective operating costs of the plan.

Ins 17.25(12)(b) (b) The board shall establish and annually review plan classifications which, in addition to the requirements under s. 619.04 (5), Stats., do all of the following to the extent possible:

Ins 17.25(12)(b)1. 1. Measure variations in exposure to loss and in expenses based upon the best data available.

Ins 17.25(12)(b)2. 2. Reflect the past and prospective loss and expense experience of risks insured in the plan and other relevant experience from this and other states.

Ins 17.25(12)(c) (c) With each rate and classification filing, the board shall submit supporting information including, in the case of rate filings, the existence, extent and nature of any subjective factors in the rates based on the judgment of technical personnel, such as consideration of the reasonableness of the rates compared with the cost of comparable available coverage.

Ins 17.25(12m) (12m) Premium surcharge tables.

Ins 17.25(12m)(a) (a) This subsection implements s. 619.04 (5m) (a), Stats., requiring the establishment of an automatic increase in a provider’s plan premium based on loss and expense experience.

Ins 17.25(12m)(b) (b) In this subsection:

Ins 17.25(12m)(b)1. 1. “Aggregate indemnity” has the meaning given under s. Ins 17.285 (2) (a).

Ins 17.25(12m)(b)2. 2. “Closed claim” has the meaning given under s. Ins 17.285 (2) (b).

Ins 17.25(12m)(b)3. 3. “Provider” has the meaning given under s. Ins 17.285 (2) (d).

Ins 17.25(12m)(b)4. 4. “Review period” has the meaning given under s. Ins 17.285 (2) (e).

Ins 17.25(12m)(c) (c) The following tables shall be used in making the determinations required under s. Ins 17.285 as to the percentage increase in a provider’s plan premium:

Ins 17.25(12m)(c)1. 1. For a class 1 and class 8 physician, podiatrist, nurse anesthetist, nurse midwife, nurse practitioner or cardiovascular perfusionist:

Ins 17.25(12m)(c)2. 2. For a class 2 physician:

Ins 17.25(12m)(c)3. 3. For a class 3 physician:

Ins 17.25(12m)(c)4. 4. For a class 4 physician:

Ins 17.25(12m)(c)5. 5. For a class 5A physician:

Ins 17.25(12m)(c)6. 6. For a class 5 physician:

Ins 17.25(12m)(c)7. 7. For a class 6 physician:

Ins 17.25(12m)(c)8. 8. For a class 7 physician:

Ins 17.25(12m)(c)9. 9. For a class 9 physician:

Ins 17.25(14) (14) Plan business; cancellation and nonrenewal.

Ins 17.25(14)(a) (a) The plan may not cancel or refuse to renew a policy except for one or more of the following reasons:

Ins 17.25(14)(a)1. 1. Nonpayment of premium.

Ins 17.25(14)(a)2. 2. Revocation of the license of the insured by the appropriate licensing board.

Ins 17.25(14)(a)3. 3. Revocation of accreditation, registration, certification or other approval issued to the insured by a state or federal agency or national board, association or organization.

Ins 17.25(14)(a)4. 4. If the insured is not licensed, accredited, registered, certified or otherwise approved, failure to provide evidence that the insured continues to provide health care services in accordance with the code of ethics applicable to the insured’s profession, if the board requests such evidence.

Ins 17.25(14)(b) (b) Each notice of cancellation or nonrenewal under par. (a) shall include a statement of the reason for the cancellation or nonrenewal and a conspicuous statement that the insured has the right to a hearing as provided in sub. (16).

Ins 17.25(15) (15) Commission.

Ins 17.25(15)(a) (a) If the application designates a licensed agent, the plan shall pay the agent a commission for each new or renewal policy issued, as follows:

Ins 17.25(15)(a)1. 1. To a health care provider specified in sub. (5) (a) to (e) or (m), 15% of the premium or $150, whichever is less.

Ins 17.25(15)(a)2. 2. To a health care provider specified in sub. (5) (f) to (L) or (n), 5% of the annual premium or $2,500 per policy period, whichever is less.

Ins 17.25(15)(b) (b) An agent need not be listed by the insurer that acts as the plan’s servicing company to receive a commission under par. (a).

Ins 17.25(15)(c) (c) If the applicant does not designate an agent on the application, the plan shall retain the commission.

Ins 17.25(16) (16) Right to hearing. Any person satisfying the conditions specified in s. 227.42 (1), Stats., may request a hearing under ch. Ins 5 within 30 days after receiving notice of the plan’s action or failure to act with respect to a matter affecting the person.

Ins 17.25(18) (18) Indemnification.

Ins 17.25(18)(a) (a) The plan shall indemnify against any cost, settlement, judgment and expense actually and necessarily incurred in connection with the defense of any action, suit or proceeding in which a person is made a party because of the person’s position as any of the following:

Ins 17.25(18)(a)1. 1. A member of the board or any of its committees or subcommittees.

Ins 17.25(18)(a)2. 2. A member of or a consultant to the peer review council under s. 655.275, Stats.

Ins 17.25(18)(a)3. 3. A member of the plan.

Ins 17.25(18)(a)4. 4. The manager or an officer or employee of the plan.

Ins 17.25(18)(b) (b) Paragraph (a) does not apply if the person is judged, in the action, suit or proceeding, to be liable because of willful or criminal misconduct in the performance of the person’s duties under par. (a) 1. to 4.

Ins 17.25(18)(c) (c) Paragraph (a) does not apply to any loss, cost or expense on a policy claim under the plan.

Ins 17.25(18)(d) (d) Indemnification under par. (a) does not exclude any other legal right of the person indemnified.

Ins 17.25(19) (19) Applicability. Each person insured by the plan is subject to this section as it existed on the effective date of the person’s policy. Any change in this section during the policy term applies to the insured as of the renewal date.

Ins 17.25 History History: Emerg. cr. eff. 3-20-75; cr. Register, June, 1975, No. 234, eff. 7-1-75; emerg. am. eff. 7-28-75; emerg. r. and recr. eff. 11-1-75; r. and recr. Register, January, 1976, No. 241, eff. 2-1-76; am. (1) (b), (2), (4) (c), and (5) (a), Register, May, 1976, No. 245, eff. 6-1-76; emerg. am. (4) (b), eff. 6-22-76; am. (1) (b), (2), (4) (b) and (c) and (5) (a), Register, September, 1976, No. 249, eff. 10-1-76; am. (1) (b), (2), (4) (c), (5) (a), (5) (f), (10) (a) and (15), cr. (4) (h), Register, May, 1977, No. 257, eff. 6-1-77; am. (1) (b), (2), (4) (c), (5) (a), (10) (a) and (15), Register, September, 1977, No. 261, eff. 10-1-77; am. (1) (b), (2), (4) (b) and (c), (5) (a) and (f), and (15), Register, May, 1978, No. 269, eff. 6-1-78; am. (7) (b) 1.a., Register, March, 1979, No. 279, eff. 4-1-79; renum. from. Ins 3.35, am. (1) (b), (2), (5) (a) and (10) (a), Register, July, 1979, No. 283, eff. 8-1-79; r. and recr. (5) (a), Register, April, 1980, No. 292, eff. 5-1-80; am. (1) (b), (2), (4) (c), (5) (a), (10) (a), (12) (a) 3. and 4. and (15), r. (12) (a) 11. renum. (12) (a) 5. through 10. and 12. to be 7. through 12. and 13., cr. (12) (a) 5. and 6., Register, May, 1985, No. 353, eff. 6-1-85; emerg. am. (1) (b), (2), (4) (c) and (5) (a) 2., eff. 7-29-86; am. (1) (b), (2), (4) (c) and (5) (a) 2., Register, January, 1987, No. 373, eff. 2-1-87; emerg. am. (1) (b), (2), (4) (c), (5) (a) 3., 4. and 7., (7) (b) 2., 3. and 5., (10) (a), (12) (intro.), (14) (a) (intro.) and 1. and (15), cr. (5) (a) 11., (7m) and (14) (a) 3. and 4., renum. (5) (a) 11., (b) and (7) (b) 1. intro. to be (5) (am), (b) (intro.) and (7) (b) and am., r. (7) (b) 1. a. and b. eff. 2-16-87; am. (1) (b), (2), (4) (c), (5) (a) 3., 4. and 7., (7) (b) 2., 3. and 5., (10) (a), (12) (intro.), (14) (a) (intro.) and 1. and (15), renum. (5) (a) 11., (b) and (7) (b) 1. to be (5) (am), (b) (intro.) and (7) (b) 1. and am., cr. (5) (a) 7m and 11., (b) 1. to 3., (7) (b) 2m. and (14) (a) 3. and 4., r. (7) (b) 1. a. and b., Register, July, 1987, No. 379, eff. 8-1-87; r. (12) (a) 13. and (b) 5., cr. (5) (a) 2m. and (12m), am. (16), Register, February, 1988, No. 386, eff. 3-1-88; r. (4) (g) and (9) (b), renum. (9) (a) to be (9), Register, March, 1988, No. 387, eff. 4-1-88; cr. (10) (cm), Register, April, 1989, No. 400, eff. 5-1-89; emerg. am. (5) (b) 3., cr. (5) (b) 4., eff. 10-16-89; am. (5) (b) 3., cr. (5) (b) 4., Register, March, 1990, No. 411, eff. 4-1-90; am. (1) (a) and (c), (2), (10) (a), (b), (c) and (d), (12) (a) 2. and 3., (14) (a) (intro.) and 4., (b), r. (3), (4) (a), (c), (d), (f) and (h), (5) (am), (d), (e) and (f), (6) (a), (7), (8) (j), (11) (a), (12) (intro.), (a) 4. to 6. intro., b. and c. and 7., (b), (c) 1., 3. and 6., (12m) (c) and (13), r. and recr. (12) (a) 1., (15), (16) and (18), renum. (4) (b) and (e), (5) (a) (intro.) to 11., (5) (b) and (c), (6) (b) and (c), (8) (a) to (i), (9), (11) (b), (12) (a) 6., 8., to 12., (12) (b) 2. and 4. and (17) to be (6) (a) 1. and 2., (5) (intro.) to (m), (3) (d) and (f), (6) (b) 2. and 3., (7), (8) (a), (b) 1. to 4., (8) (a) 3. to 5., (8) (b) 5., (6) (c), (12) (a) 4. to 6., (12) (a) 5. b., (12) (c), (12) (a) 7., (12) (b) 1. and 2., and (6) (d) and am. except (3) (d) 1. to 4., cr. (3) (a) to (c) and (e), (5) (n), (6) (a) (intro.) and (b) 1., (8) (a) (intro.) and 6., (b) (intro.), (12) (b) (intro.) and (19), Register, June, 1990, No. 414, eff. 7-1-90; am. (10) (cm), Register, April, 1991, No. 424, eff. 5-1-91; am. (12m) (c) (intro.), Register, January, 1992, No. 433, eff. 2-1-92; correction in (5) (c) and (n) made under s. 13.93 (2m) (b) 7., Stats., Register, January, 1997, No. 498; correction in (12) (a) 3. made under s. 13.93 (2m) (b) 7., Stats., Register, September, 1999, No. 525; emerg. am. (3) (d) 3., renum. (3) (d) 4. to be 5. and cr. (3) (d) 4., eff. 7-1-02; CR 02-035: am. (3) (d) 3., renum. (3) (d) 4. to be (3) (d) 5., cr. (3) (d) 4., Register September 2002 No. 561, eff. 10-1-02; corrections in (5) (c) and (n) made under s. 13.93 (2m) (b) 7., Stats., Register October 2003 No. 574; CR 07-001: am. (12m), Register June 2007 No. 618, eff. 7-1-07; corrections in (5) (c), (n), and (8) (a) 5. made under s. 13.92 (4) (b) 6. and 7., Stats., Register June 2009 No. 642.

Ins 17.25 Note Note: See the table of Appellate Court Citations for Wisconsin appellate cases citing s. Ins 17.25.

Ins 17.26 Ins 17.26 Payments for future medical expenses.

Ins 17.26(1) (1) Purpose. This section implements s. 655.015, Stats.

Ins 17.26(3) (3) Definitions. In this section:

Ins 17.26(3)(a) (a) “Account” means a portion of the fund allocated specifically for the medical expenses of an injured person.

Ins 17.26(3)(b) (b) “Claimant” means the injured person, the individual legally responsible for the injured person’s medical expenses or the injured person’s legal representative.

Ins 17.26(3)(c) (c) “Medical expenses” means charges for medical services, nursing services, medical supplies, drugs and rehabilitation services that are incurred after the date of a settlement, panel award or judgment.

Ins 17.26(4) (4) Administration.

Ins 17.26(4)(a) (a) If a settlement or judgment is subject to s. 655.015, Stats., the insurer or other person responsible for payment shall, within 30 days after the date of the settlement or judgment, pay the fund the amount in excess of $100,000 and shall provide the fund with an executed copy of the document setting forth the terms under which payments for medical expenses are to be made.

Ins 17.26(4)(b) (b) The fund shall credit each account with a proportional share of any interest earned by the fund, based on the remaining value of the account at the time the investment board declares the interest earnings. The fund shall maintain an individual record of each account as provided in s. 16.41, Stats.

Ins 17.26(4)(c) (c) Upon receipt of a claimant’s request for reimbursement of medical expenses, the fund, after determining that the supplies or services provided were necessary and incidental to the injury sustained by the injured person and that the provider of the supplies or services has actually been paid, shall pay the claim from the appropriate account.

Ins 17.26(4)(d) (d)

Ins 17.26(4)(d)1. 1. If the fund is not satisfied that a provider has actually been paid for services or supplies provided to an injured person, the fund may make payments jointly to the claimant and the provider.

Ins 17.26(4)(d)2. 2. A claimant may, in writing, authorize direct payment to a provider.