NY State Senate Bill 2015-S5224A

Senate Bill S5224A

2015-2016 Legislative Session

Requires physicians licensed to practice medicine in the state to have medical malpractice insurance coverage from an insurer authorized to do business in the state

download bill text pdf

Archive: Last Bill Status - In Senate Committee Insurance Committee

Introduced
- In Committee Assembly
- In Committee Senate
- On Floor Calendar Assembly
- On Floor Calendar Senate
- Passed Assembly
- Passed Senate
Delivered to Governor
Signed By Governor

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Actions

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	Assembly Actions - Lowercase Senate Actions - UPPERCASE
Jun 08, 2016	print number 5224a
Jun 08, 2016	amend (t) and recommit to insurance
Jan 06, 2016	referred to insurance
May 07, 2015	referred to insurance

Bill Amendments

Original

A (Active)

2015-S5224 - Details

Current Committee:: Senate Insurance
Law Section:: Insurance Law
Laws Affected:: Amd §3436, Ins L; amd §§6524 & 6525, Ed L
Versions Introduced in 2017-2018 Legislative Session:: S5673

2015-S5224 - Summary

Requires physicians licensed to practice medicine in the state to have medical malpractice insurance coverage from an insurer authorized to do business in the state.

2015-S5224 - Sponsor Memo

                                BILL NUMBER:S5224

TITLE OF BILL:

An act to amend the insurance law and the education law, in relation
to medical malpractice insurance requirements as a condition to
practice medicine

PURPOSE:

Requires physicians licensed or permitted to practice medicine in the
state to have medical malpractice insurance coverage from an insurer
authorized to do business in the state.

SUMMARY OF PROVISIONS:

Section one describes the legislative intent of the bill. As a matter
of patient safety and the larger public safety, it is in the state's
interest to encourage licensed medical practitioners to purchase
insurance which provides the highest degree of financial security. To
that end, the state considers it important to not just encourage
physicians to acquire medical malpractice professional liability
insurance, but to require them to do so from companies admitted to
write insurance in New York.

Section two amends subsection (a) of section 3436 of the insurance law

requires licensed physicians, unless exempt due to membership in a
voluntary attending physician ("Channeling") program, to obtain
professional liability insurance from an admitted insurer if they were
to chose to acquire any form of professional liability coverage.

Section three amends section 6524 of the education law to require that
those who intend to engage in the practice of medicine in the state
and intend to purchase professional liability coverage must purchase
such coverage through an admitted insurer.

Section four amends section 6525 of the education law makes the same
requirement as section 3 of the bill upon any applicant for or holder
of a permit to practice medicine.

Section five provides for an effective date.

JUSTIFICATION:

Patient safety is not just a clinical concern, but a financial one as
well. Nothing assures the financial soundness of an insurer better
than compulsory adherence to the strongest standards in the country
enforced by a regulator who is in the state, no matter how secure a
carrier may appear to be. And nothing assures the financial security
backstopping a physician's activities than such an insurer.
Therefore, it is important to regulate the purchasing behavior of such
physicians by compelling their acquisition of professional liability
insurance when they choose to buy such coverage.

New York already, and has for thirty years, directed purchasing
activities of physicians by requiring them to purchase admitted
carrier professional liability coverage if they wanted to participate


in the excess medical malpractice program, which provides a second
layer of coverage for no cost to physicians.

LEGISLATIVE HISTORY:

New bill.

FISCAL IMPLICATIONS:

None.

EFFECTIVE DATE:

Immediately, provided that for the policies in force on the effective
date and written by an insurer not authorized to do business in this
state, the provisions shall apply on or after the anniversary date of
such policy.

2015-S5224 - Bill Text download pdf

                            
                    S T A T E   O F   N E W   Y O R K
________________________________________________________________________

                                  5224

                       2015-2016 Regular Sessions

                            I N  S E N A T E

                               May 7, 2015
                               ___________

Introduced  by  Sen.  HANNON -- read twice and ordered printed, and when
  printed to be committed to the Committee on Insurance

AN ACT to amend the insurance law and the education law, in relation  to
  medical  malpractice insurance requirements as a condition to practice
  medicine

  THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND  ASSEM-
BLY, DO ENACT AS FOLLOWS:

  Section  1.  Legislative  intent.  The legislature has long recognized
that medical malpractice insurance is a vital component of  the  state's
health  care system and economic safety net. Medical malpractice is that
which is relied upon by both practicing physicians, dentists  and  other
health  care  professionals,  and  patients  who  become the victim of a
negligent health care act. It is in the interest  of  all  New  Yorkers,
therefore,  that  medical  malpractice  insurance  which  is obtained by
health care providers practicing according to the privileges granted  by
a  license issued by the state be of a kind and nature that provides the
highest degree of financial security. This should include, in the legis-
lature's estimation, medical malpractice insurance which is regulated by
this state's insurance company regulator and medical malpractice  carri-
ers  whose  policies  are  protected  by  a  guaranty  fund, such as the
property/casualty insurance  security  fund  which  was  established  to
protect  claimants  and  policyholders from the difficulties encountered
from an insurance company insolvency. Therefore, it is the legislature's
intent to assure the  highest  degree  of  protection  for  patient  and
provider  alike  by  requiring  as  a  condition of practicing medicine,
dentistry or other health care profession in the state, the purchase  of
medical,  dental or other forms of health care practitioner professional
liability insurance from an insurer authorized to write  such  coverages
in  this  state,  and protected by the appropriate security fund if such
insurance is to be obtained by a  licensed  health  care  provider.  The
legislature   further  directs  that  the  superintendent  of  financial

 EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                      [ ] is old law to be omitted.
                                                           LBD10702-01-5

S. 5224                             2

services shall maintain a market surveillance to assure  that  all  such
health  care provider insurance coverages are available in the state, or
inform the legislature when such coverage for any given  provider  class
is not available.
  S  2.  Subsection (a) of section 3436 of the insurance law, as amended
by chapter 381 of the laws of 1991, is amended to read as follows:
  (a) Every insurer which issues or renews policies for  primary  levels
of  medical  malpractice insurance covering physicians licensed to prac-
tice in this state shall issue such policies on a claims-made or  occur-
rence  basis,  as  prescribed  by  the superintendent by regulation; AND
EVERY PHYSICIAN LICENSED TO PRACTICE MEDICINE IN THIS STATE, AS A CONDI-
TION OF SUCH LICENSURE, OBTAINS OR INTENDS TO OBTAIN A POLICY OF MEDICAL
MALPRACTICE INSURANCE, WHETHER ON A CLAIMS-MADE OR OCCURRENCE BASIS,  TO
COVER  THE TREATMENT OF PATIENTS OR OTHER LIABILITIES ARISING FROM THEIR
PRACTICE OF MEDICINE PURSUANT TO HIS OR HER LICENSE TO  DO  SO  IN  THIS
STATE  SHALL  DO  SO ONLY FROM AN AUTHORIZED INSURER OR FROM THE MEDICAL
MALPRACTICE INSURANCE POOL; PROVIDED, HOWEVER, THAT THIS SHALL NOT APPLY
TO ANY PHYSICIAN COVERED BY A MEDICAL  MALPRACTICE  POLICY  OR  COVERAGE
THROUGH  A VOLUNTARY ATTENDING PHYSICIAN ("CHANNELING") PROGRAM APPROVED
BY THE SUPERINTENDENT; provided, further, that nothing in  this  section
shall preclude any insurer from applying otherwise applicable underwrit-
ing standards in determining whether to issue or renew such policies.
  S  3.  Section  6524  of  the education law is amended by adding a new
subdivision 12 to read as follows:
  (12) MALPRACTICE INSURANCE: WHERE AN APPLICANT INTENDS  TO  ENGAGE  IN
THE  TREATMENT  OF  PATIENTS  AS  A PHYSICIAN AND INTENDS TO PROCURE AND
MAINTAIN IN FULL FORCE AND EFFECT A POLICY OF MEDICAL MALPRACTICE INSUR-
ANCE, SUCH APPLICANT MAY ONLY OBTAIN SUCH  INSURANCE  COVERAGE  FROM  AN
INSURER  AUTHORIZED  TO  DO  BUSINESS IN THIS STATE AND ACTUALLY WRITING
SUCH COVERAGE IN THIS STATE, OR FROM THE MEDICAL  MALPRACTICE  INSURANCE
POOL.
  S  4.  Section  6525  of  the education law is amended by adding a new
subdivision 5 to read as follows:
  5. MALPRACTICE INSURANCE. EVERY APPLICANT FOR AND HOLDER OF  A  PERMIT
TO  PRACTICE MEDICINE PURSUANT TO THIS SECTION WHO OBTAINS OR INTENDS TO
OBTAIN A POLICY OF MEDICAL MALPRACTICE INSURANCE SHALL DO SO  ONLY  FROM
AN  INSURER AUTHORIZED TO DO BUSINESS IN THIS STATE AND ACTUALLY WRITING
SUCH INSURANCE COVERAGE IN THIS STATE, OR FROM THE  MEDICAL  MALPRACTICE
INSURANCE POOL.
  S  5.  This act shall take effect immediately; provided, however, that
for policies in force on such effective date and written by  an  insurer
not  authorized to do business in this state, the provisions of this act
shall apply on and after the anniversary date of such policies.

2015-S5224A (ACTIVE) - Details

Current Committee:: Senate Insurance
Law Section:: Insurance Law
Laws Affected:: Amd §3436, Ins L; amd §§6524 & 6525, Ed L
Versions Introduced in 2017-2018 Legislative Session:: S5673

2015-S5224A (ACTIVE) - Summary

Requires physicians licensed to practice medicine in the state to have medical malpractice insurance coverage from an insurer authorized to do business in the state.

2015-S5224A (ACTIVE) - Sponsor Memo

                                 BILL NUMBER:  S5224A

 TITLE OF BILL :  An act to amend the insurance law and the education
law, in relation to medical malpractice insurance requirements for
physicians licensed to practice medicine in this state

 PURPOSE :

Requires physicians licensed or permitted to practice medicine in the
state who choose to buy medical malpractice insurance to have the
primary layer of such insurance coverage from an insurer authorized to
do business in the state.

 SUMMARY OF PROVISIONS :

Section one describes the legislative intent of the bill. As a matter
of patient safety and the larger public's safety, it is in the state's
interest to encourage licensed medical practitioners to purchase
insurance which provides the highest degree of financial security. To
that end, the state considers it important to not just encourage
physicians to acquire medical malpractice professional liability
insurance, but to require them to do so from companies admitted to
write insurance in New York.

Section two amends subsection (a) of section 3436 of the insurance law
requires licensed physicians, unless exempt due to membership in a

voluntary attending physician ("Channeling") program, to obtain the
first layer, or $ 1.3 million, of professional liability insurance
from an admitted insurer if they were to chose to acquire any form of
professional liability coverage.

Section three amends section 6524 of the education law to require that
those who intend to engage in the practice of medicine in the state
and intend to purchase professional liability coverage must purchase
the first layer of such coverage through an admitted insurer.

Section four amends section 6525 of the education law makes the same
requirement as section 3 of the bill upon any applicant for or holder
of a permit to practice medicine.

Section five provides for an effective date.

 JUSTIFICATION :

Patient safety is not just a clinical concern, but a financial one as
well. Nothing assures the financial soundness of an insurer better
than compulsory adherence to the strongest standards in the country
enforced by a regulator who is in the state, no matter how secure a
carrier may appear to be. And nothing assures the financial security
backstopping a physician's activities than such an insurer.
Therefore, it is important to regulate the purchasing behavior of such
physicians by compelling their acquisition of professional liability
insurance when they choose to buy such coverage.

By the amendment to his legislation, the requirement to buy from an
authorized insurer is limited to the first layer of coverage,
recognized in statute as $1.3 million. Physicians are able to procure
reinsurance, excess insurance and other financial protections from
other sources thereafter.

New York already, and has for thirty years, directed purchasing
activities of physicians by requiring them to purchase admitted
carrier professional liability coverage if they wanted to participate
in the excess medical malpractice program, which provides a second
layer of coverage for no cost to physicians.

 LEGISLATIVE HISTORY :

New bill

 FISCAL IMPLICATIONS :

None

 EFFECTIVE DATE :
Immediately, provided that for the policies in force on the effective
date and written by an insurer not authorized to do business in this
state, the provisions shall apply on or after the anniversary date of
such policy.

2015-S5224A (ACTIVE) - Bill Text download pdf

                            
                    S T A T E   O F   N E W   Y O R K
________________________________________________________________________

                                 5224--A

                       2015-2016 Regular Sessions

                            I N  S E N A T E

                               May 7, 2015
                               ___________

Introduced  by  Sen.  HANNON -- read twice and ordered printed, and when
  printed to be committed to the Committee on Insurance  --  recommitted
  to the Committee on Insurance in accordance with Senate Rule 6, sec. 8
  --  committee  discharged,  bill amended, ordered reprinted as amended
  and recommitted to said committee

AN ACT to amend the insurance law and the education law, in relation  to
  medical  malpractice insurance requirements for physicians licensed to
  practice medicine in this state

  THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND  ASSEM-
BLY, DO ENACT AS FOLLOWS:

  Section  1.  Legislative  intent.  The legislature has long recognized
that medical malpractice insurance is a vital component of  the  state's
health  care system and economic safety net. Medical malpractice is that
which is relied upon by both practicing physicians, dentists  and  other
health  care  professionals,  and  patients  who  become the victim of a
negligent health care act. It is in the interest  of  all  New  Yorkers,
therefore,  that  medical  malpractice  insurance  which  is obtained by
health care providers practicing according to the privileges granted  by
a  license issued by the state be of a kind and nature that provides the
highest degree of financial security. This should include, in the legis-
lature's estimation, medical malpractice insurance which is regulated by
this state's insurance company regulator and medical malpractice  carri-
ers  whose  policies  are  protected  by  a  guaranty  fund, such as the
property/casualty insurance  security  fund  which  was  established  to
protect  claimants  and  policyholders from the difficulties encountered
from an insurance company insolvency. Therefore, it is the legislature's
intent to assure the  highest  degree  of  protection  for  patient  and
provider  alike  by  requiring  as  a  condition of practicing medicine,
dentistry or other health care profession in the state, the purchase  of
medical,  dental or other forms of health care practitioner professional
liability insurance from an insurer authorized to write  such  coverages

 EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                      [ ] is old law to be omitted.
                                                           LBD10702-02-6

S. 5224--A                          2

in  this  state,  and protected by the appropriate security fund if such
insurance is to be obtained by a  licensed  health  care  provider.  The
legislature   further  directs  that  the  superintendent  of  financial
services  shall  maintain  a market surveillance to assure that all such
health care provider insurance coverages are available in the state,  or
inform  the  legislature when such coverage for any given provider class
is not available.
  S 2. Subsection (a) of section 3436 of the insurance law,  as  amended
by chapter 381 of the laws of 1991, is amended to read as follows:
  (a)  Every  insurer which issues or renews policies for primary levels
of medical malpractice insurance covering physicians licensed  to  prac-
tice  in this state shall issue such policies on a claims-made or occur-
rence basis, as prescribed by  the  superintendent  by  regulation;  AND
EVERY  PHYSICIAN LICENSED TO PRACTICE MEDICINE IN THIS STATE WHO OBTAINS
OR INTENDS TO OBTAIN A POLICY OF MEDICAL MALPRACTICE INSURANCE,  WHETHER
ON  A  CLAIMS-MADE  OR OCCURRENCE BASIS, EQUIVALENT TO THE PRIMARY LIMIT
PROVIDED FOR IN SECTION EIGHTEEN OF CHAPTER TWO HUNDRED SIXTY-SIX OF THE
LAWS OF NINETEEN HUNDRED EIGHTY-SIX, AS AMENDED, TO COVER THE  TREATMENT
OF PATIENTS OR OTHER LIABILITIES ARISING FROM THEIR PRACTICE OF MEDICINE
PURSUANT  TO  HIS OR HER LICENSE TO DO SO IN THIS STATE SHALL DO SO ONLY
FROM AN AUTHORIZED INSURER  ACTUALLY  WRITING  SUCH  INSURANCE  IN  THIS
STATE,  OR FROM THE MEDICAL MALPRACTICE INSURANCE POOL; PROVIDED, HOWEV-
ER, THAT THIS SHALL NOT APPLY TO ANY  PHYSICIAN  COVERED  BY  A  MEDICAL
MALPRACTICE  POLICY  ISSUED BY OR COVERAGE THROUGH A VOLUNTARY ATTENDING
PHYSICIAN  ("CHANNELING")  PROGRAM  APPROVED  BY   THE   SUPERINTENDENT;
provided,  further,  that  nothing  in  this  section shall preclude any
insurer from applying otherwise  applicable  underwriting  standards  in
determining whether to issue or renew such policies.
  S  3.  Section  6524  of  the education law is amended by adding a new
subdivision 12 to read as follows:
  (12) MALPRACTICE INSURANCE: WHERE AN APPLICANT INTENDS  TO  ENGAGE  IN
THE  TREATMENT  OF  PATIENTS  AS  A PHYSICIAN AND INTENDS TO PROCURE AND
MAINTAIN IN FULL FORCE AND EFFECT A POLICY OF MEDICAL MALPRACTICE INSUR-
ANCE EQUIVALENT TO THE PRIMARY LIMIT PROVIDED FOR IN SECTION EIGHTEEN OF
CHAPTER  TWO  HUNDRED  SIXTY-SIX  OF  THE  LAWS  OF   NINETEEN   HUNDRED
EIGHTY-SIX, AS AMENDED, SUCH AN APPLICANT MAY ONLY OBTAIN SUCH INSURANCE
COVERAGE  FROM  AN  INSURER  AUTHORIZED TO DO BUSINESS IN THIS STATE AND
ACTUALLY WRITING SUCH COVERAGE IN THIS STATE, OR FROM THE MEDICAL  MALP-
RACTICE INSURANCE POOL.
  S  4.  Section  6525  of  the education law is amended by adding a new
subdivision 5 to read as follows:
  5. MALPRACTICE INSURANCE. EVERY APPLICANT FOR AND HOLDER OF  A  PERMIT
TO  PRACTICE MEDICINE PURSUANT TO THIS SECTION WHO OBTAINS OR INTENDS TO
OBTAIN A POLICY OF  MEDICAL  MALPRACTICE  INSURANCE  EQUIVALENT  TO  THE
PRIMARY  LIMIT  PROVIDED  FOR IN SECTION EIGHTEEN OF CHAPTER TWO HUNDRED
SIXTY-SIX OF THE LAWS OF NINETEEN HUNDRED EIGHTY-SIX, AS AMENDED,  SHALL
DO  SO  ONLY FROM AN INSURER AUTHORIZED TO DO BUSINESS IN THIS STATE AND
ACTUALLY WRITING SUCH INSURANCE COVERAGE IN  THIS  STATE,  OR  FROM  THE
MEDICAL MALPRACTICE INSURANCE POOL.
  S  5.  This act shall take effect immediately; provided, however, that
for policies in force on such effective date and written by  an  insurer
not  authorized to do business in this state, the provisions of this act
shall apply on and after the anniversary date of such policies.

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