SUMMARY OF Public Act 05-275
AN ACT CONCERNING MEDICAL MALPRACTICE

Contingency Fees (Section 1)

• Applicable to causes of action accruing on or after the passage of the bill.
  
  
• Provides for the continuation of the sliding scale of contingency fees attorneys may charge clients based on the amount of the settlement or judgment.
  
  
• Sliding scale applies to any lawsuit to recover damages resulting from personal injury, wrongful death, or property damage involving contingency fees, not just to medical malpractice cases.
  
  
• allows a claimant in a claim or civil action that accrues on or after the date the bill becomes effective to waive the benefit of the limitation contained in the sliding scale only if the claim is substantially complex, unique, or different from other claims
  
  
• factors that may indicate that a claim is substantially complex, unique, or different include, but are not limited to, whether it:

  * involves complex factual, medical, or legal issues

  * involves serious permanent personal injury or death

  * is likely to require extensive investigation and discovery proceedings, including multiple depositions; or

  * requires testimony, whether at trial or in a deposition, from an expert who has not participated in the claimant’s care or in any official investigation of the incident involved.

• The bill makes any waiver of the sliding scale invalid unless the agreement is in writing
  
  
• If a claimant waives the sliding scale, the bill limits the total fee under the contingency fee to one-third per cent of the damages awarded and received by the claimant or of the settlement amount received by the claimant and prohibits the firm from requiring the claimant to repay any costs that the attorney incurred in prosecuting the case.
  
  
• Likely impact on malpractice rates: none.

Good Faith Certificate (Section 2)

• Previous law prohibited filing malpractice lawsuits unless the attorney or claimant had made a reasonable an inquiry as permitted by the circumstances to determine that there are grounds for a good faith belief that the claimant received negligent care or treatment.
  
  
• The complaint or initial pleading must contain a certificate of the attorney or claimant that his inquiry resulted in a good faith belief that grounds exist for a lawsuit against each named defendant.
  
  
• Under previous law, a good faith belief can be shown if the claimant or his attorney receives a written opinion from a similar health care provider that there appears to be evidence of medical negligence. But it was not required.
  
  
• The present bill instead requires, for lawsuits filed after September 30, 2005, a written signed opinion from a similar health care provider in order to show good faith. The opinion must include the reasons for concluding that medical negligence occurred. It is not subject to discovery by the defendants except for questioning the certificate’s validity.
  
  
• The bill makes the failure to obtain and file the written opinion grounds for the dismissing the case.
  
  
• The bill requires the claimant or his attorney to retain the original written opinion and attach a copy of it to the certificate, with the health care provider’s name and signature removed.
  
  
• The bill imposes the same good faith certificate requirement on defendants who file an apportionment complaint against another health care provider.
  
  
• The bill makes the health care provider who provides the opinion immune from liability unless it is shown he acted with malice.
  
  
• The court may impose sanctions if a certificate is not made in good faith.

Complex Litigation Case (Section 3)

• The bill requires the court, within six months after a medical malpractice case is filed, to schedule a conference to determine whether to recommend to the chief court administrator, or his designee, that it be designated as a complex litigation case and transferred to the complex litigation docket. The bill specifies that it does not prevent any party or a judge from, at any time, asking the chief court administrator to designate it as a complex litigation case.

Offer of Compromise By Plaintiffs and Defendants (Sections 4 – 7)
Contract Cases or Cases Seeking Money Judgments

• Applicable to actions accruing on or after October 1, 2005
  
  
• Regarding all contract cases or cases seeking money damages that accrue after September 30, 2005, the bill makes several changes in this process. It reduces the interest the court must add from 12% to 8%. It prohibits the plaintiff from making the offer for at least 180 days after service of process on the defendant. It changes the terminology from “offer of judgment” to “offer of compromise,” and gives the defendant 30 instead of 60 days to accept.
  
  
• If the defendant accepts the offer, he must file his acceptance with the court clerk. After the plaintiff receives the amount specified in the offer from the defendant, he must file a withdrawal of the lawsuit with the clerk, which the clerk must record. Thus, no judgment is entered against the defendant.
  
  
• By law, defendants may also file an offer with the court clerk up to 30 days before trial. The plaintiff has 60 days after being notified of the defendant’s offer to accept it. If the plaintiff recovers less than the offer of judgment, he must pay the defendant’s costs accruing after he received his offer, including reasonable attorney’s fees up to $ 350.
  
  
• If the plaintiff files an acceptance of an offer to compromise with the clerk and receives the amount specified in the offer, the plaintiff must file a withdrawal of
  
  
• the lawsuit with the clerk.

OFFERS OF COMPROMISE

Medical Malpractice Cases

• The bill requires that, in medical malpractice cases, an offer of compromise must specify all damages then known to the plaintiff or his attorney when the offer is made.
  
  
• At least sixty days before filing the offer, the plaintiff or his attorney must provide the defendant or his attorney with an authorization to disclose medical records.
  
  
• disclose all expert witnesses who will testify as to the prevailing professional standard of care.
  
  
• The plaintiff must file with the court a certification that the plaintiff has provided each defendant or his attorney with all documentation supporting the damages.

Evidence of Damages Awarded (Section 8)

• The bill allows defendants in medical malpractice cases that accrue after September 30, 2005, to introduce evidence of the amount of damages awarded to the plaintiff for the same injury or death in a separate lawsuit the plaintiff filed against a different health care provider.

Expressions of Sympathy, Apology, Fault, Etc. (Section 9)

• The bill makes certain statements or other conduct inadmissible evidence as an admission of liability or an admission against interest in any medical malpractice lawsuit, or in any arbitration proceeding related to it.
  
  
• This rule applies to statements, affirmations, gestures, or conduct expressing apology, fault, sympathy, commiseration, condolence, compassion, or a general sense of benevolence that a health care provider or his employee makes to the alleged victim, his relative, or representative regarding the victim’s discomfort, pain, suffering, injury, or death as a result of the outcome of a medical treatment or procedure that differs from an expected result.
  
  
• The victim’s relatives include his spouse, parent, grandparent, stepfather, stepmother, child, grandchild, brother, sister, half-sibling, or his spouse’s parents; relationships that are created by adoption; and any person who has a family-type relationship with a victim. A victim’s representative is his legal guardian, attorney, health care agent, or any one else recognized in law or custom as a his agent.

Mandatory Review of Noneconomic Damages Over $1 Million (Section 10)

• The bill requires the court, in any medical malpractice case in which the jury awards more than $ 1 million in noneconomic damages, to review the evidence to determine if the amount is excessive as a matter of law.
  
  
• It requires the court to consider whether it so shocks the sense of justice as to compel the conclusion that the jury was influenced by partiality, prejudice, mistake, or corruption.
  
  
• If the court concludes the award was excessive, it must order the plaintiff to remit the excessive amount.

Prior Malpractice Insurance Rate Approval (Section 11)

• The bill subjects malpractice insurance rates for physicians, hospitals, advanced practice registered nurses, and physician assistants to prior rate approval by the insurance commissioner.
  
  
• Each insurer or rating organization seeking to increase its rates by 7 ½% or more must file a request with the Insurance Department and send, by certified mail, written notice to all affected insureds at least 60 days before the change’s effective date on a form the insurance commissioner prescribes.
  
  
• The request for a rate increase must be filed after this notice is sent and must indicate the date the notice was sent.
  
  
• The notice must indicate that the insured can request a public hearing by submitting a written request to the insurance commissioner within 15 days after the date notice was sent. Within 15 days after notice is sent, the insurer must give the Insurance Department a list of insured’s to whom notice was sent and indicate whether a return receipt was received for each.
  
  
• The bill prohibits the insurance commissioner from approving, modifying, or denying a requested rate increase until the time period for insureds to request a hearing expires. It requires the commissioner to hold a public hearing, if requested, before taking action.
  
  
• The commissioner must approve, modify, or deny the filing within 45 days after receipt. The final decision may be appealed to Superior Court.

Insurance Commissioner Review of Malpractice Insurance Rates (Section 12)

• The bill requires that by October 1, 2008 the insurance commissioner to review medical malpractice insurance rates in Connecticut for physicians, hospitals, advanced practice registered nurses, and physicians’ assistants to determine if:

  (1) the amount or frequency of insured awards and settlements against these providers have decreased since October 1, 2005;

  (2) the rates reflect the decrease; and

  (3) the rates bear a reasonable relationship to the costs of writing such insurance in this state.

• The commissioner must examine the rates for policies issued by:

  (1) captive insurers and risk retention groups, to the extent this information is available, and

  (2) insurers licensed in Connecticut.

• If the commissioner determines that rates have not decreased and are not reasonably related to the costs of writing such insurance in the state, she must convene a working group to:

  (1) consider the amounts of awards and settlements in the past 10 years and

  (2) recommend appropriate changes, if any, in the law to decrease rates or establish reasonable ones.

• These changes may include reasonable limits on noneconomic damages awards, revisions to procedures insurers use to establish rates, and regulation of reimbursement rates health insurers and HMOs pay to health care providers.

PLAN TO MAINTAIN A VIABLE MEDICAL MALPRACTICE INSURANCE INDUSTRY (Section 13)

• By January 1, 2006, the insurance commissioner must develop and submit to the governor a plan to maintain a viable medical malpractice insurance industry in Connecticut for physicians, hospitals, advanced practice registered nurses, and physician assistants.

MEDICAL MALPRACTICE DATA BASE-CLOSED CLAIM REPORTS (Section 14)

Closed Claim Reports

• Current law authorizes the insurance commissioner to require all medical malpractice insurers in Connecticut to submit whatever information she deems necessary to establish a medical malpractice database. The database can include information on all incidents of medical malpractice, all settlements, all awards, other information relative to procedures and specialties involved, and any other information relating to risk management.
  
  
• The bill instead requires, beginning January 1, 2006, each insurer (including captive insurers and self-insured entities) provide to the commissioner a closed claim report, on whatever form she requires. A “closed claim” is one that has been settled or otherwise disposed of, where the insurer has paid all claims regarding physicians, hospitals, advanced practice registered nurses, and physician assistants.
  
  
• The bill requires the insurer to report within 10 days after the end of the calendar quarter in which a claim is closed. The report must include information only about claims settled under Connecticut’s laws. It must include details about the insured and insurer, the injury or loss, the claims process, and the amount paid on the claim.

Details About the Insured and Insurer

• The report must include the:

  (1) insurer’s name;

  (2) policy limits and whether it was an occurrence policy or was issued on a claims-made basis;

  (3) insured’s name, address, license number, and specialty coverage; and

  (4) insured’s policy number and unique claim number. An “occurrence policy” provides protection for malpractice that occurred during the time the policy was in effect. A “claims-made” policy provides protection for claims made during the period the policy is in effect.

Details About the Injury or Loss

• The report must specify the:
  1. date of the injury or loss that was the basis of the claim;
     
     
  2. date the injury or loss was reported to the insurer;
     
     
  3. name of the institution or location where the injury or loss occurred;
     
     
  4. type of injury or loss, including an injury severity rating that corresponds with the injury scale that the commissioner must establish based on the severity scale developed by the National Association of Insurance Commissioners; and
     
     
  5. name, age, and gender of any injured person covered by the claim.
  
  

Details About the Claims Process

• The report must contain details about the claims process including:
  
  1. whether a lawsuit was filed, and if so, in which court;
     
     
  2. its outcome;
     
     
  3. the number of other defendants, if any;
     
     
  4. the stage in the process when the claim was closed;
     
     
  5. the trial dates;
     
     
  6. the date of any judgment or settlement;
     
     
  7. whether an appeal was filed, and if so, the date filed;
     
     
  8. the resolution of the appeal and the date it was decided;
     
     
  9. the date the claim was closed; and
     
     
  10. the initial and final indemnity and expense reserve for the claim.
  
  

Details About the Amount Paid on the Claim

• The report must include:
  
  1. the total amount of the initial judgment rendered by a jury or awarded by the court;
     
     
  2. the total amount of the settlement if no judgment was rendered or awarded or the claim was settled after judgment was rendered or awarded;
     
     
  3. the amount of economic and noneconomic damages, or the insurer’s estimate of these amounts in a settlement;
     
     
  4. the amount of any interest awarded due to failure to accept an offer of judgment;
     
     
  5. the amount of any remittitur (reduction) or additur (addition) and the amount of final judgment after such reductions or additions;
     
     
  6. the amount the insurer paid;
     
     
  7. the amount the defendant paid due to a deductible or a judgment or settlement in excess of policy limits;
     
     
  8. the amount other insurers or other defendants paid;
     
     
  9. whether a structured settlement was used;
     
     
  10. the expense assigned to and recorded with the claim, including defense and investigation costs but not including the actual claim payment; and
      
      
  11. any other information the commissioner determines necessary to regulate the medical malpractice insurance industry, ensure its solvency, and ensure that such liability insurance is available and affordable.

Annual Data Summary

• The bill requires the insurance commissioner to aggregate the data in individual closed claim reports into a summary and annually report the summary data. The report must analyze the closed claim information, including:
  
  1. a minimum of five years of comparative data, when available;
     
     
  2. trends in frequency and severity of claims;
     
     
  3. itemization of damages;
     
     
  4. timeliness of the claims process; and
     
     
  5. any other descriptive or analytical information that would help interpret the trends in closed claims.
  
  
• The annual report must include a summary of rate filings for medical malpractice insurance for medical professionals and entities that the department approved for the prior calendar year.
  
  
• The summary must include an analysis of the trend of direct losses, incurred losses, earned premiums, and investment income as compared to prior years.
  
  
• The report must also include base premiums charged by medical malpractice insurers for each specialty and the number of providers insured by specialty for each insurer.

CAPTIVE INSURERS (Sections 15 and 16)

• The bill requires each captive insurer that offers, renews, or continues insurance in Connecticut to provide the following information to the insurance commissioner in the same manner required for risk retention groups:
  
  1. a copy of the group’s financial statement submitted to its state of domicile, which must be certified by an independent public accountant and contain a statement of opinion on loss and loss adjustment expense reserves made by a member of the American Academy of Actuaries or a qualified loss reserve specialist;
     
     
  2. a copy of each examination of the captive as certified by the commissioner or public official conducting the examination; and
     
     
  3. at the commissioner’s request, a copy of any audit performed with respect to the captive.
  
  
• The bill requires the commissioner to act as agent for service of process for risk retention groups domiciled outside the United States and for captive insurers. By law, the commissioner acts as agent for risk retention groups domiciled in another state that offer insurance in Connecticut.

DPH DISCIPLINARY GUIDELINES AGAINST DOCTORS (Section 17)

• The bill requires that, by January 1, 2006, the DPH, with the assistance of the Connecticut Medical Examining Board, and relevant medical professional associations, establish guidelines for use in the disciplinary process. The guidelines, must include, at a minimum:
  
  1. identification of each type of violation;
     
     
  2. a range of penalties for each type of violation;
     
     
  3. additional conditions that the board may impose;
     
     
  4. identification of factors the board must consider to determine what penalty should apply;
     
     
  5. conditions, such as mitigating factors or other facts, that the board may consider in deviating from the guidelines; and
     
     
  6. a requirement for the board to specify its reason for any deviating from the guidelines.
  
  
• The bill specifies that the guidelines may not be considered regulations.

DPH HEARING PROCEEDINGS AGAINST DOCTORS (Sections 18 & 19)

• By law, DPH must investigate charges that a physician may be unable to practice medicine with reasonable skill or safety. If it finds probable cause, it refers the mater to the Medical Examining Board, which must refer it to a three-member hearing panel within 60 days of receiving it. The panel makes a recommendation to the board after conducting a hearing on the charges. The board may restrict, suspend, or revoke a physician's license or limit his right to practice for certain misconduct.
  
  
• The bill expands the pool of people who may serve as members of such panels from 18 to 24. The bill specifies that at least eight, instead of eight, must be physicians, and at least one, instead of one, must be a physician assistant.
  
  
• By law, the three-member medical hearing panel must include a board member and a public member. The bill requires that one member must be a physician or a physician assistant as appropriate.

DPH INVESTIGATION GUIDELINES CONCERNING COMPLAINTS AGAINST PHYSICIANS (Section 20)

• Under current law, the DPH commissioner, with the Connecticut Medical Examining Board’s advice and assistance, may establish regulations to carry out his physician licensing duties. The bill instead requires the commissioner to establish guidelines, which will not be considered regulations, to carry out these duties. By January 1, 2006, the commissioner must establish guidelines:
  
  1. for screening complaints about physicians’ competence to determine which complaints DPH will investigate and in what order;
     
     
  2. for conducting investigations to ensure prompt action when it appears necessary;
     
     
  3. to determine when an investigation should be broadened beyond the initial complaint to include sampling patient records to identify patterns of care, reviewing office practices and procedures, and reviewing performance and discharge data from hospitals; and
     
     
  4. to protect and ensure the confidentiality of patient and provider identities when an investigation is broadened.
     
     
  
  

PHYSICIAN PROFILES (Sections 23 & 24)

• The bill amends DPH’s physician profile program to require physicians to report adverse licensure actions taken in other states.
  
  
• The bill also requires the physician to report, for the first time, (1) whether he is actively involved in patient care and (2) the name of his professional liability insurance carrier.
  
  
• The bill requires periodic updating of additional physician profile elements, including appointments to Connecticut medical school faculties; professional services, activities, and awards; hospital disciplinary actions; and medical malpractice judgments, arbitration awards, and settlements.

CONTINUING EDUCATION (Sections 21, 25 & 26)

Requirements and Acceptable Education and Activities

• Beginning October 1, 2007, the bill requires a physician applying for license renewal to have completed at least 50 contact hours of continuing education during the previous 24 months. A “contact hour” means a minimum of 50 minutes of continuing education activity. It must:
  

  (1) be in the physician’s practice area;

  (2) reflect the physician’s professional needs in order to meet the public’s health care needs; and

  (3) include at least one contact hour of training or education in infectious diseases (e. g. AIDS, HIV), risk management, sexual assault, and domestic violence.

  
  
• A physician applying for license renewal must sign a statement that he satisfied the continuing education requirements.
  
  
• The physician must keep attendance records or certificates of completion showing compliance with the continuing education requirements for at least three years following the year in which they were completed.

EXEMPTIONS

• A first-time applicant for license renewal is exempt from the continuing education requirements.
  
  
• Also exempt is a physician not actively practicing during a one-year registration (license renewal).
  
  
• A physician exempt from the continuing education requirements for less than two years must complete 25 contact hours of continuing education within the 12 months immediately preceding his return to active practice.
  
  
• A physician exempt for two or more years must complete the Special Purpose Examination of the Federation of State Medical Boards before returning to active practice.

Medical Disability or Illness Waiver

• The bill allows the DPH commissioner to waive the continuing education requirements or grant an extension to a physician in the case of medical disability or illness.
  
  
• A physician whose license lapses and who applies for reinstatement must document to DPH successful completion of the 25-hour continuing education requirement within the one-year preceding the application.

PHYSICIANS IN THE ARMED FORCES (Section 26)

• Under the bill, DPH must renew the license of a physician that becomes void for nonrenewal because he is on active duty in the armed forces within one year from the discharge date upon completion of the 25 contact hours of continuing education.

PRE-SURGICAL PROTOCOLS (Section 27)

• The bill requires each hospital and outpatient surgical facility to develop protocols for accurate identification procedures that they must use before surgery.
  
  
• The protocols must include (1) procedures to identify the patient, the surgical procedure to be performed, and the body part on which it is to be performed and (2) alternative identification procedures in urgent or emergency circumstances or where the patient cannot speak or is comatose, incompetent, or a child.
  
  
• After January 1, 2006, no hospital or outpatient surgical facility may anesthetize a patient or perform surgery unless the protocols have been followed.
  
  
• Each health care facility must make a copy of its protocols available to the commissioner upon request. DPH must report to the Public Health Committee by October 1, 2006 and describe the protocols developed.

DPH PATIENT SAFETY PROGRAMS (Section 28)

• By January 1, 2006, the bill requires each hospital to (1) contract with a patient safety organization, to gather medical or health care related data from the hospital and make recommendations to the hospital on ways to improve patient care and safety, and (2) provide documentation to DPH, in whatever form and manner DPH requires, that the hospital has complied.
  
  
• A “patient safety organization” is any public or private organization, or part of one, whose primary activity is improving patient safety and quality of health care delivery for patients.