AAOS Bulletin - December, 2005

In Brief


Gov. Janet Napolitano (D) has signed an executive order to speed the state’s adoption of an electronic health record (EHR) system. The order creates a committee whose goal is to ensure widespread adoption of EHRs by 2010, four years ahead of the schedule established by the federal government. The Department of Health and Human Services has estimated that $140 billion could be saved nationwide by improving health information technology.


Although a recent federal court ruling gave Gov. Arnold Schwarzenegger (R) the ability to cut Medi-Cal physician reimbursement rates, he has agreed not to cut rates this year and to work with the California Medical Association to avoid cuts in future years. California’s physician reimbursement rates currently rank near the bottom for the nation.


Colorado’s major medical liability insurer, Copic Insurance Company, announced that it will raise premium rates by less than 3 percent for 2006. The insurer’s chairman attributed the rate improvement to legislation that helped mitigate recent Colorado Supreme Court decisions that had undermined the state’s curbs on excessive medical liability claims. Increased efforts to improve patient safety also played a part in the lower premium increases.


The Connecticut Insurance Department rejected a 12 percent medical liability premium rate hike requested by ProMutual Group, one of the state’s top insurers. The other major medical liability insurer in the state, Connecticut Medical Insurance Company, had already announced that it would not raise rates next year, and an analysis by an independent actuarial company did not agree with the numbers put out by ProMutual.


The state’s Board of Pharmacy recently proposed a rule change that would allow pharmacists to change patients’ prescriptions to a “therapeutic equivalent” if the “equivalent” drug is preferred by the patient’s health plan formulary. Several physician groups have been fighting this change, saying that it is unsafe for patients and could expose physicians to greater liability risks. A Florida Medical Association official pointed out that patient convenience should not trump patient safety.


UnitedHealthcare is facing a proposed fine of $2.4 million based on violations of Georgia’s prompt payment laws. The Georgia insurance commissioner said up to 80,000 claims had not been paid in a timely manner. UnitedHealthcare called the fine disproportionately high and said it disputes the Insurance Department’s calculations.


In response to the Medicaid payment delays, which were reported in the October column, the state has agreed to borrow $1 billion to pay off some of the outstanding debts to health care providers. However, the Illinois state treasurer has stated that borrowing is not the long-term answer to the systemic problem.


State law has traditionally prevented physical therapists from treating a patient without a physician’s referral. A new bill being considered would not change the need for a referral, but would allow nurse practitioners to make such a referral.


The Medical Assurance Company of Mississippi, a top insurer in the state, announced it will reduce medical liability insurance rates by 5 percent for next year. The state insurance commissioner stated that this reduction was a direct result of 2004 tort reforms.


Pennsylvania’s largest medical liability insurer, the Pennsylvania Medical Society Liability Insurance Company, recently announced that it will not raise premiums in 2006. Pennsylvania has passed limited tort reforms, but its state constitution forbids caps on noneconomic damages. However, a spokesperson for the insurer credited policy and market adjustments for the premium freeze, rather than tort reforms.

Gov. Ed Rendell (D) called for extending the state’s program that helps physicians pay medical liability insurance premiums. Gov. Rendell stated that Pennsylvania has started to see improvements in its medical liability problems, but two more years of the program will ensure that reforms have a chance to become fully effective.


Doctors and lawyers have come together to endorse a pilot program in Chattanooga aimed at reducing unfounded expert witness testimony. In cases where there is conflicting medical expert testimony, judges would be able to select an independent expert to assess the testimony in order to help the judge determine admissibility.


Gov. Jim Doyle (D) vetoed legislation the state Senate recently passed that sets new limits on nonecomonic damages in medical liability lawsuits. The legislation would set noneconomic award caps at $550,000 for victims age 18 or younger and $450,000 for adult victims. Gov. Doyle vetoed the measure because it closely resembles one that the State Supreme Court ruled unconstitutional only a few months ago.


The Wyoming Healthcare Commission has recommended that the state spend $41.3 million over the next five years to create a statewide EHR network. The director of the commission stated that going electronic would result in a higher-quality, more cost effective system.

This roundup was prepared by Bruce Allain, JD, a legislative analyst in the department of socioeconomic and state society affairs. He can be reached at allain@aaos.org

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