On March 8, the Indiana Senate voted 49-0 in favor of a proposal to increase the limit of Indiana’s medical malpractice compensation cap for the first time since 1999. The House passed a similar measure on March 3 with a 90-5 vote, and the bill is now awaiting Governor Mike Pence’s signature.
The compensation cap will increase to $1.65 million in 2017 and then to $1.8 million in 2019. Previously, it had been set at $1.25 million for the past 18 years, and has only been raised twice since its inception in 1975.
A Joint Effort
The final legislation passed after months of extensive negotiations by lawmakers, the Indiana State Medical Association (ISMA), Indiana Hospital Association, Indiana Health Care Association, and Indiana Trial Lawyers Association. According to the Indianapolis Business Journal, earlier versions of the bill included incremental, inflationary increases over the next 15 years, but physician groups argued that continual increases would make malpractice insurance premiums unaffordable.
On the other hand, according to the Indianapolis Star, legislators feared the cap was unfairly low for plaintiffs and the entire law might be ruled unconstitutional, like in other states, if changes weren’t made.
A Model State
Indiana was an early adopter of comprehensive malpractice reports back In 1975. According to the ISMA, the Indiana Compensation Act for Patients (INCAP) “became a model for other states, as it balanced the needs of physicians for affordable liability insurance premiums with the needs of patients for good access to all kinds of medical care.”
Features of Indiana’s Medical Malpractice legislation that make it different from other states include a two-year statute of limitations (or by age eight for children under six years old), limits on both recovery and attorney fees, and a medical review panel jointly selected by the plaintiff and defendant.
Indiana also has a Patient’s Compensation Fund (PCF) managed by the Indiana Department of Insurance. Then, in a malpractice decision, physicians who participate must pay only the first $250,000 of the damages through their malpractice insurance, and the PCF would pay the rest of the damages up to the $1.25 million cap.
There is no indication of what, if any, changes would be made to the PCF under the increased caps approved earlier this month.
For more information about Indiana Malpractice Laws, visit the Indiana Department of Insurance Medical Malpractice webpage.
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