Amount of surcharge
Sec. 2. (a) As used in this section, "actuarial program" means a
program used or created by the department to determine the actuarial
risk posed to the patient compensation fund under IC 34-18-6 (or
IC 27-12-6 before its repeal) by a hospital. The program must be:
(1) developed to calculate actuarial risk posed by a hospital,
taking into consideration risk management programs used by
the hospital;
(2) an efficient and accurate means of calculating a hospital's
malpractice actuarial risk;
(3) publicly identified by the department by July 1 of each year;
and
(4) made available to a hospital's malpractice insurance carrier
for purposes of calculating the hospital's surcharge under
subsection (g).
(b) Beginning July 1, 1999, the amount of the annual surcharge
shall be one hundred percent (100%) of the cost to each health care
provider for maintenance of financial responsibility. Beginning July
1, 2001, the annual surcharge shall be set by a rule adopted by the
commissioner under IC 4-22-2.
(c) The amount of the surcharge shall be determined based upon
actuarial principles and actuarial studies and must be adequate for
the payment of claims and expenses from the patient's compensation
fund.
(d) The surcharge for qualified providers other than:
(1) physicians licensed under IC 25-22.5; and
(2) hospitals licensed under IC 16-21;
may not exceed the actuarial risk posed to the patient's compensation
fund under IC 34-18 (or IC 27-12 before its repeal) by qualified
providers other than physicians licensed under IC 25-22.5 and
hospitals licensed under IC 16-21.
(e) There is imposed a minimum annual surcharge of one hundred
dollars ($100).
(f) Notwithstanding subsections (b), (c), and (e), beginning July
1, 1999, the surcharge for a qualified provider who is licensed under
IC 25-22.5 is calculated as follows:
(1) The commissioner shall contract with an actuary that has
experience in calculating the actuarial risks posed by
physicians. Not later than July 1 of each year, the actuary shall
calculate the median of the premiums paid for malpractice
liability policies to the three (3) malpractice insurance carriers
in the state that have underwritten the most malpractice
insurance policies for all physicians practicing in the same
specialty class in Indiana during the previous twelve (12) month
period. In calculating the median, the actuary shall consider the:
(A) manual rates of the three (3) leading malpractice
insurance carriers in the state; and
(B) aggregate credits or debits to the manual rates given
during the previous twelve (12) month period.
(2) After making the calculation described in subdivision (1),
the actuary shall establish a uniform surcharge for all licensed
physicians practicing in the same specialty class. This surcharge
must be based on a percentage of the median calculated in
subdivision (1) for all licensed physicians practicing in the same
specialty class under rules adopted by the commissioner under
IC 4-22-2. The surcharge:
(A) must be sufficient to cover; and
(B) may not exceed;
the actuarial risk posed to the patient compensation fund under
IC 34-18-6 (or IC 27-12-6 before its repeal) by physicians
practicing in the specialty class.
(g) Beginning July 1, 1999, the surcharge for a hospital licensed
under IC 16-21 that establishes financial responsibility under
IC 34-18-4 after June 30, 1999, is established by the department
through the use of an actuarial program. At the time financial
responsibility is established for the hospital, the hospital shall pay
the surcharge amount established for the hospital under this section.
The surcharge:
(1) must be sufficient to cover; and
(2) may not exceed;
the actuarial risk posed to the patient compensation fund under
IC 34-18-6 by the hospital.
(h) An actuarial program used or developed under subsection (a)
shall be treated as a public record under IC 5-14-3.
As added by P.L.1-1998, SEC.13. Amended by P.L.111-1998, SEC.7;
P.L.233-1999, SEC.14.
Last modified: May 24, 2006