Malpractice reform deal OK'd

Ehrlich veto expected

December 30, 2004|by the Cracker Barrel

ANNAPOLIS (AP) - Democratic legislative leaders, ignoring veto threats from Gov. Robert Ehrlich, put together a medical malpractice insurance reform package Wednesday that they said will solve the state's malpractice crisis and ensure that doctors will be available when Marylanders need them.

The bill would provide immediate relief from the 33 percent average increase doctors will have to pay for malpractice insurance coverage in 2005, lowering the hikes to 5 percent. It also would put new restrictions on malpractice lawsuits, a measure that lawmakers said will hold the line on future rate increases by reducing the cost of malpractice settlements.

But the proposal would apply a 2 percent tax on HMO premiums, adamantly opposed by Ehrlich, that would be used to underwrite the cost of malpractice insurance. The new revenues also would be used to increase the amount of money paid under the Medicaid program to doctors in a few specialties such as obstetrics who are under the most severe financial pressure from low insurance reimbursements and high insurance premiums.


The bill developed by key House and Senate negotiators needed a final ratification vote in the House and Senate. Legislative leaders, confident they could get the votes required for passage, told delegates and senators to show up shortly before midnight for the final discussion and votes.

Ehrlich said late Wednesday that the "net result of this exercise is a tax bill," which he called "unacceptable." He vowed to introduce another bill of his own at the start of the 2005 session on Jan. 12.

"We'll roll up our sleeves and get ready for round two in two weeks," Lt. Gov. Michael Steele told reporters.

Senate President Thomas V. Mike Miller urged Ehrlich not to make a rash decision and to "take plenty of time to reflect on this bill and all the good it does."

"He's got tunnel vision on this HMO tax," Miller said.

A veto would be "completely irresponsible," said Sen. Brian Frosh, D-Montgomery, a lead negotiator.

Busch also appealed to Ehrlich to sign the bill, saying, "It defies logic for him to criticize what has been accomplished."

But Ehrlich said he would not sign any bill that included the HMO tax.

"We didn't call these folks into special session so they could pass a regressive tax that will be passed on to those who can least afford to pay it," the governor said. Ehrlich said even with the state facing a potential deficit of more than $300 million next year, he could find the $42 million to pay for the first year of the malpractice reform legislation.

The governor summoned lawmakers to Annapolis on Tuesday for a special session to deal with what he says is the most important issue facing the state of Maryland. Doctors have been hit with increases in premiums for 2004 and 2005. The increases have been even steeper for some doctors in high-risk specialties such as obstetrics and neurosurgery.

Ehrlich proposed strict restrictions on malpractice lawsuits, commonly referred to as tort reform, arguing that frivolous suits and excessive malpractice awards had driven up the cost of malpractice insurance to the point that some doctors could no longer afford the premiums and were curtailing or shutting down their practices.

When he announced he would call the special session, the governor said he, Miller and Busch were close enough to an agreement to make it likely they could get something done quickly.

But there was never an agreement on a funding source, and, unable to get the governor to budge on the HMO tax, the speaker and Senate president put together their own plan, hoping that if Ehrlich followed through on his veto threat, they could get support from enough Democratic lawmakers to override the veto.

Republicans made a final effort in the Senate on Wednesday afternoon to block the HMO tax. Senate Minority Leader Lowell Stoltzfus tried to remove the HMO tax and replace it with some of the money Maryland receives as its share of the national settlement between the states and tobacco companies. The attempt was rejected with most Democrats voting against it.

But Democrats said the cigarette restitution money should not be touched because it is used to provide health care to poor people.

Sen. Paula Hollinger, D-Baltimore County, chided the governor for his unrelenting opposition to the HMO tax, even though he increased the state property tax, imposed a sewer fee and increased automobile registration fees.

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