Senate Bill No. 426
(By Senators Wells, Sypolt, K. Facemyer, Green, Laird and
Williams)
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[Introduced March 3, 2009; referred to the Committee on Miliary;
and then to the Committee on Banking and Insurance.]
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A BILL to amend and reenact §33-20F-9 of the Code of West Virginia,
1931, as amended, relating to requiring providers with
insurance coverage under the Physicians' Mutual Insurance
Company to accept Tricare military insurance as a condition of
Physicians' Mutual Insurance Company.
Be it enacted by the Legislature of West Virginia:
That §33-20F-9 of the Code of West Virginia, 1931, as amended,
be amended and reenacted to read as follows:
ARTICLE 20F. PHYSICIANS' MUTUAL INSURANCE COMPANY.
§33-20F-9. Kinds of coverage authorized; transfer of policies from
the State Board of Risk and Insurance Management;
risk management practices authorized.
(a) Upon approval by the commissioner for a license to
transact insurance in this state, the company may issue nonassessable policies of malpractice insurance, as defined in
subdivision (9), subsection (e), section ten, article one of this
chapter, insuring a physician. Additionally, the company may issue
other types of casualty or liability insurance as may be approved
by the commissioner.
(b) On the transfer date:
(1) The company shall accept from the Board of Risk and
Insurance Management the transfer of any and all medical liability
insurance obligations and risks of existing or in-force contracts
of insurance covering physicians, physician corporations and
physician-operated clinics issued by the board pursuant to article
twelve-b, chapter twenty-nine of this code.
Provided, That
However, the company may decline or refuse to renew any and all
such contracts of insurance transferred to the company from the
Board of Risk and Insurance Management upon the expiration of the
respective terms of each contract of insurance so transferred and
nothing in this section is intended to or shall be construed to
otherwise obligate the company to accept, underwrite or renew any
contract of insurance whatsoever. The transfer shall not include
medical liability insurance obligations and risks of existing or
in-force contracts of insurance covering hospitals and nonphysician
providers;
(2) The company shall assume all responsibility for and
defend, indemnify and hold harmless the Board of Risk and Insurance Management and the state with respect to any and all liabilities
and duties arising from the assets and responsibilities transferred
to the company pursuant to article twelve-b, chapter twenty-nine of
this code;
(3) The Board of Risk and Insurance Management shall disburse
and pay to the company any funds attributable to premiums paid for
the insurance obligations transferred to the company pursuant to
subdivision (1) of this subsection, with earnings thereon, less
paid losses and expenses, and deposited in the Medical Liability
Fund created by section ten, article twelve-b, chapter twenty-nine
of this code as reflected on the ledgers of the Board of Risk and
Insurance Management;
(4) The Board of Risk and Insurance Management shall disburse
and pay to the company any funds in the Board of Risk and Insurance
Management Physicians' Mutual Insurance Company account created by
section seven of this article. All funds in this account shall be
transferred pursuant to terms of a surplus note or other loan
arrangement satisfactory to the Board of Risk and Insurance
Management and the Insurance Commissioner.
(c) The Board of Risk and Insurance Management shall cause an
independent actuarial study to be performed to determine the amount
of all paid losses, expenses and assets associated with the
policies the board has in force pursuant to article twelve-b,
chapter twenty-nine of this code. The actuarial study shall determine the paid losses, expenses and assets associated with the
policies to be transferred to the company pursuant to subsection
(b) of this section and the paid losses, expenses and assets
associated with those policies retained by the board. The
determination shall not include liabilities created by issuance of
new tail insurance policies for nonphysician providers authorized
by subsection (n), section six, article twelve-b, chapter
twenty-nine of this code.
(d) The Board of Risk and Insurance Management may enter into
such agreements, including loan agreements, with the company that
are necessary to accomplish the transfers addressed in this
section.
(e) The company shall make policies of insurance available to
physicians in this state, regardless of practice type or specialty.
Policies issued by the company to each class of physicians are to
be essentially uniform in terms and conditions of coverage.
(f) Notwithstanding the provisions of subsection (b), (c) or
(e) of this section, the company may:
(1) Establish reasonable classifications of physicians,
insured activities and exposures based on a good faith
determination of relative exposures and hazards among
classifications;
(2) Vary the limits, coverages, exclusions, conditions and
loss-sharing provisions among classifications;
(3) Establish, for an individual physician within a
classification, reasonable variations in the terms of coverage,
including rates, deductibles and loss-sharing provisions, based on
underwriting criteria established by the company, from time to
time, which underwriting criteria may take into account factors
considered by other medical malpractice insurance companies, from
time to time, in underwriting similar risks and which factors may
include, but are not limited to, the insured's prior loss
experience; current professional training and capability;
disciplinary action taken against the physician by the Board of
Medicine or Board of Osteopathy; felonies or other criminal
offenses committed by the physician; evidence of alcohol or
chemical dependency or abuse; evidence of sexual misconduct; and
other factors relevant to the liability risk profile of the
physician.
(4) Refuse to provide insurance coverage for individual
physicians who do not meet underwriting criteria established by the
company, from time to time, which underwriting criteria may take
into account factors considered by other medical malpractice
insurance companies, from time to time, in underwriting or
declining to underwrite similar risks and which factors may
include, but are not limited to, prior loss experience, current
professional training and capability, disciplinary action taken
against the physician by the Board of Medicine or Board of Osteopathy; felonies or other criminal offenses committed by the
physician; evidence of alcohol or chemical dependency or abuse;
evidence of sexual misconduct; and other factors relevant to the
liability risk profile of the physician and which do or may
indicate that the physician represents an unacceptable risk of loss
if coverage is provided.
(g) The company shall establish reasonable risk management and
continuing education requirements which policyholders must meet in
order to be and remain eligible for coverage.
(h) A health care provider is not eligible to obtain coverage
under the insurance plan authorized pursuant to this article if he
or she refuses, on a regular basis, to accept patients solely
because their health care coverage is provided pursuant to Tricare
Military Insurance. For purposes of this section, Tricare is
defined as a health care program serving active duty service
members, National Guard and Reserve members, retirees, their
families, survivors and certain former spouses.
NOTE: The purpose of this bill is to require that medical
providers who obtain malpractice insurance from Physician's Mutual
Insurance accept Tricare Military Insurance.
Strike-throughs indicate language that would be stricken from
the present law, and underscoring indicates new language that would
be added.