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Enrolled Version - Final Version House Bill 4740 History

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Key: Green = existing Code. Red = new code to be enacted
HB ORIG 1 LINE
ENROLLED

H. B. 4740


(By Delegates Michael, Doyle, Campbell, Leach,

Boggs, Stalnaker and Warner)


[Passed March 13, 2004; in effect ninety days from passage.]



AN ACT to amend the code of West Virginia, 1931, as amended, by adding thereto a new article, designated §29-12D-1, §29-12D-2 and §29-12D-3, all relating to the establishment, initial funding and operation of a patient injury compensation fund; creating a patient injury compensation fund; providing initial funding; providing the fund is not an insurer or insurance company under the code; providing for administration by the board of risk and insurance management; specifying certain powers and authority of the board; protecting the assets of the fund; requiring an annual audit of the fund by an independent actuary; providing immunity for the state and its agents for the debts, liabilities or obligations of the fund; providing for payments from the fund to qualified claimants; providing limits on the amount on payment in respect of any occurrence; authorizing payments from the fund either in lump sums or periodic payments; establishing procedures; providing for proration of payments under certain circumstances; authorizing the payment of reasonable attorney fees; and providing for appeals.

Be it enacted by the Legislature of West Virginia:
That the code of West Virginia, 1931, as amended, be amended by adding thereto a new article, designated §29-12D-1, §29-12D-2 and §29-12D-3, all to read as follows:
ARTICLE 12D. WEST VIRGINIA PATIENT INJURY COMPENSATION FUND.
§29-12D-1. Creation of patient injury compensation fund; purpose; initial funding of patient injury compensation fund.

(a) There is created the West Virginia patient injury compensation fund, for the purpose of providing fair and reasonable compensation to claimants in medical malpractice actions for any portion of economic damages awarded that is uncollectible as a result of limitations on economic damage awards for trauma care, or as a result of the operation of the joint and several liability principles and standards, set forth in article seven-b, chapter fifty-five of this code. The fund shall consist of all contributions, revenues and moneys which may be paid into the fund from time to time by the state of West Virginia or from any other source whatsoever, together with any and all interest, earnings, dividends, distributions, moneys or revenues of any nature whatsoever accruing to the fund.
(b) Initial funding for the fund shall be provided as follows: During fiscal year two thousand five, two million two hundred thousand dollars of the revenues that would otherwise be transferred to the tobacco account established in subsection (b), section two, article eleven-a, chapter four of this code pursuant to the provisions of section fourteen, article three, chapter thirty-three of this code shall be transferred to the fund; during fiscal year two thousand six, two million two hundred thousand dollars of the revenues that would otherwise be transferred to the tobacco account established in subsection (b), section two, article eleven-a, chapter four of this code pursuant to the provisions of section fourteen, article three, chapter thirty-three of this code, shall be transferred to the fund; and during fiscal year two thousand seven, two million two hundred thousand dollars of the revenues that would otherwise be transferred to the tobacco account established in subsection (b), section two, article eleven-a, chapter four of this code pursuant to the provisions of section fourteen, article three, chapter thirty-three of this code shall be transferred to the fund. Beginning fiscal year two thousand eight, if and to the extent additional funding for the fund is required from time to time to maintain the actuarial soundness of the fund, the additional funding may be provided by further act of the Legislature, either from the revenue stream identified in this subsection or otherwise. Payments to the tobacco fund shall be extended until the tobacco fund is repaid in full.
(c) The fund is not and shall not be considered a defendant in any civil action arising under article seven-b, chapter fifty-five of this code.
(d) The fund is not and shall not be considered an insurance company or insurer for any purpose under this code.
§29-12D-2. Administration of fund; investment of fund assets; annual actuarial review and audit; fund assets and liabilities not assets and liabilities of the state.

(a) The patient injury compensation fund shall be implemented, administered and operated by the board of risk and insurance management. In addition to any other powers and authority expressly or impliedly conferred on the board of risk and insurance management in this code, the board may:
(1) Receive, collect and deposit all revenues and moneys due the fund;
(2) Employ, or in accordance with the provisions of law applicable contract for personal, professional or consulting services, retain the services of a qualified competent actuary to perform the annual actuarial study of the fund required by this section and advise the board on all aspects of the fund's administration, operation and defense which require application of the actuarial science;
(3) Contract for any services necessary or advisable to implement the authority and discharge the responsibilities conferred and imposed on the board by this article;
(4) Employ, or contract with, legal counsel of the board's choosing to advise and represent the board and represent the fund in respect of any and all matters relating to the operation of the fund and payments out of the fund;
(5) Employ necessary or appropriate clerical personnel to carry out the responsibilities of the board under this part; and
(6) Promulgate rules, in accordance with article three, chapter twenty-nine-a of this code as it considers necessary or advisable to implement the authority of and discharge the responsibilities conferred and imposed on the board by this article.
(b) The assets of the fund, and any and all income, dividends, distributions or other income or moneys earned by or accruing to the benefit of the fund, shall be held in trust for the purposes contemplated by this article, and shall not be spent for any other purpose: Provided, That the assets of the fund may be used to pay for all reasonable costs and expenses of any nature whatsoever associated with the ongoing administration and operation of the fund. All assets of the fund from time to time shall be deposited with, held and invested by, and accounted for separately by the investment management board. All moneys and assets of the fund shall be invested and reinvested by the investment management board in the same manner as provided by law for the investment of other trust fund assets held and invested by the investment management board.
(c) The board shall cause an annual review of the assets and liabilities of the fund to be conducted on an annual basis by a qualified, independent actuary.
(d) The board shall cause an audit of the fund to be conducted on an annual basis by a qualified, independent auditor.
(e) The state of West Virginia is not liable for any liabilities of the fund. Claims or expenses against the fund are not a debt of the state of West Virginia or a charge against the general revenue fund of the state of West Virginia.
§29-12D-3. Payments from the patient injury compensation fund.
(a) Other than payments in connection with the ongoing operation and administration of the fund, no payments may be made from the fund other than in satisfaction of claims for economic damages to qualified claimants who would have collected economic damages but for the operation of the limits on economic damages set forth in article seven-b, chapter fifty-five of this code.
(b) For purposes of this article, a qualified claimant must be both a "patient" and a "plaintiff" as those terms are defined in article seven-b, chapter fifty-five of this code.
(c) Any qualified claimant seeking payment from the fund must establish to the satisfaction of the board that he or she has exhausted all reasonable means to recover from all applicable liability insurance an award of economic damages, following procedures prescribed by the board by legislative rule.
(d) Upon a determination by the board that a qualified claimant to the fund for compensation has exhausted all reasonable means to recover from all applicable liability insurance an award of economic damages arising under article seven-b, chapter fifty- five of this code, the board shall make a payment or payments to the claimant for economic damages. The economic damages must have been awarded but be uncollectible after the exhaustion of all reasonable means of recovery of applicable insurance proceeds. In no event shall the amount paid by the board in respect to any one occurrence exceed one million dollars or the maximum amount of money that could have been collected from all applicable insurance prior to the creation of the patient injury compensation fund under this article, regardless of the number of plaintiffs or the number of defendants or, in the case of wrongful death, regardless of the number of distributees.
(e) The board, in its discretion, may make payments to a qualified claimant in a lump sum amount or in the form of periodic payments. Periodic payments are to be based upon the present value of the total amount to be paid by the fund to the claimant by using federally approved qualified assignments.
(f) In its discretion, the board may make a payment or payments out of the fund to a qualified claimant in connection with the settlement of claims arising under article seven-b, chapter fifty-five of this code, all according to rules promulgated by the board. The board shall prior to making payment determine that payment from the fund to a qualified claimant is in the best interests of the fund. When the claimant and the board agree upon a settlement amount, the following procedure shall be followed:
(1) A petition shall be filed by the claimant with the court in which the action is pending, or if none is pending, in a court of appropriate jurisdiction, for approval of the agreement between the claimant and the board.
(2) The court shall set the petition for hearing as soon as the court's calendar permits. Notice of the time, date and place of hearing shall be given to the claimant and to the board.
(3) At the hearing the court shall approve the proposed settlement if the court finds it to be valid, just and equitable.
(g) If and to the extent that any payment to one or more qualified claimants under this section would deplete the fund during any fiscal year, payments to and among qualified claimant's shall be prorated during the fiscal year according to the rules promulgated by the board. Any amounts due and unpaid to qualified claimants shall be paid in subsequent fiscal years from available funds, but only to the extent funds are available in any fiscal year, according to the board's rules.
(h) Payments out of the fund may be used to pay reasonable attorney fees of attorneys representing qualified claimants receiving compensation in respect of economic damages as established by the board of risk and insurance management.
(i) The claimant may appeal a final decision made by the board pursuant to the provisions of article five, chapter twenty-nine-a of this code.
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