- The Washington Times - Thursday, January 13, 2005

ANNAPOLIS — The Ehrlich administration said yesterday that the fiscal 2006 budget will include the $48.5 million promised to help fix the medical malpractice insurance crisis.

“It is in the budget,” said Budget Secretary James C. “Chip” DiPaula Jr.

Mr. DiPaula said Gov. Robert L. Ehrlich Jr., a Republican, will include the money, even though the Democrat-controlled General Assembly refused to approve his malpractice legislation during a special legislative session in late December and passed its own, which lifts a tax exemption on health maintenance organizations (HMOs).

Mr. Ehrlich vetoed the General Assembly legislation, but lawmakers responded by overriding the governor.

The $48.5 million will come from the state’s general fund and will comprise $30 million to reduce the cost of doctors’ medical malpractice premiums and $18.5 million to help them with Medicaid reimbursements.

Other specifics about Mr. Ehrlich’s estimated $24 billion balanced budget — including a projected $400 million in cuts to state government — will be released Wednesday when he presents the budget to lawmakers.

Maryland faces a $965 million shortfall in fiscal 2007.

Mr. DiPaula told The Washington Times that the Medicaid money will help general surgeons, neurosurgeons, obstetricians, orthopedists and emergency-room physicians defray costs.

“By making sure you have appropriate compensation, you’re ensuring that the doctors will be there for the citizens who need them,” he said.

The Medicaid reimbursements will total $37 million when the federal government matches the state’s payment.

The General Assembly’s bill places a cap of $650,000 on lawsuit awards for pain and suffering; reduces the cap on wrongful-death awards to $812,500 and proposes more stringent standards for expert witnesses. The bill gives a $64 million subsidy to doctors.

Mr. Ehrlich has said the bill, which does not force the loser in malpractice suits to pay the cost of litigation, fails to go far enough to resolve the problems. He also opposes lifting the tax exemption on HMOs, calling it a “regressive … pass-through tax.”

Administration spokeswoman Shareese N. DeLeaver said the governor will reintroduce his malpractice reform plan during the General Assembly session that started Wednesday.

The governor’s original plan attempts to reform the tort system and pay down a 33 percent medical malpractice premium increase.

Many doctors have said the premium increases would force them out of business or out of the state. The higher premiums were due Dec. 31.

The Medical Mutual Liability Insurance Society of Maryland — the state’s largest insurer of doctors — has released figures that indicate physicians are paying the higher premiums.

State regulators authorized Medical Mutual to increase its malpractice insurance premiums by 33 percent this year, after having increased them by 28 percent in 2003 and 10 percent in 2002.

Mr. Ehrlich has raised some fees since taking office in 2003, but also has overseen a more than 5 percent reduction in the state’s work force.

Mr. DiPaula has said the governor is unwilling to ask law-enforcement or education officials to absorb further cuts in state funding.

However, he has told other state agencies that their 2006 budgets would be 88 percent to 95 percent of what they received for fiscal 2005, which ends on the last day of June, Mr. DiPaula said.

The Maryland Board of Public Works voted at the end of June to eliminate 361 positions from the state government, including 318 that were unfilled.

The vote came after lawmakers mandated the reductions but allowed agencies and the Board of Public Works, headed by Mr. Ehrlich, to choose which jobs to trim to preserve the state’s projected $87 million surplus in fiscal 2005.



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