- The Washington Times - Thursday, December 30, 2004

ANNAPOLIS — Gov. Robert L. Ehrlich Jr. yesterday reiterated his pledge to veto any medical-malpractice insurance reform bill that includes repealing a tax exemption on health maintenance organizations (HMOs).

“The HMOs have promised they will pass this on [to patients],” Mr. Ehrlich said. “The numbers will speak for themselves.”

The House and Senate conferred last night to merge two divergent malpractice- insurance reform bills that each contain a measure that would require HMOs to pay a 2 percent tax on their premiums, having garnered enough votes to override the governor’s promised veto.

Revenue from the HMO tax would subsidize a 33 percent increase in doctors’ malpractice-insurance premiums, which are to be paid in full by tomorrow. Both chambers of the General Assembly have rejected the governor’s bill, which called for covering doctors’ premiums with revenue from the state’s general fund and placing strict limits on malpractice lawsuits.

Doctors have said the higher insurance premiums could force them out of business or out of the state.

Mr. Ehrlich called the HMO tax “regressive.” The Republican governor also criticized Senate President Thomas V. Mike Miller Jr., saying the Democratic leader had changed his mind about supporting reducing the cost of malpractice lawsuits, an effort commonly referred to as tort reform.

“I guess that is a road map for the future. It’s an unfortunate road map,” said Mr. Ehrlich, who had negotiated with Mr. Miller and House Speaker Michael E. Busch for several weeks before calling a special session on the issue. “The people have the right to expect better from our leaders.”

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.

Mr. Ehrlich said late last night 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 Jan. 12.

“We’ll roll up our sleeves and get ready for round two in two weeks,” Lt. Gov. Michael S. Steele told reporters.

Mr. Miller, a Prince George’s Democrat and trial lawyer, said he will try to make sure many tort-reform measures are included in the final draft of the General Assembly’s medical-malpractice insurance reform bill.

The Senate president also remained confident that Mr. Ehrlich would change his mind about vetoing the bill. “The governor will have plenty of time to reflect on this bill and all the good it does,” he said.

Mr. Busch, Anne Arundel Democrat, echoed Mr. Miller’s sentiments. “The HMOs have not been against this issue,” he said.

Delegate Kevin Kelly, an Allegany County Democrat who voted with Republicans against a House bill that included the HMO tax, criticized the Democratic leaders’ decision to include it.

“We elected the governor statewide,” Mr. Kelly said. “He ran on the platform of no more broad-based taxes. I am very comfortable with the governor funding this out of the general fund.”

In the Senate, Sen. J. Lowell Stoltzfus, Somerset County Republican and minority leader, 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.

“I think this is a reasonable way to get off the impasse” over the HMO tax, Mr. Stoltzfus said.

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

This is the first special session in Maryland since a budget-focused session was held in 1992.

A special session costs taxpayers $45,000 a day, according to a study by the state’s Department of Legislative Services.

This article is based in part on wire service reports.

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