HARRISBURG -- The Senate this week approved an amended version of the Medical Care and Reduction of Error Act, designed to enhance patient safety, reduce medical errors and reduce medical malpractice insurance premiums paid by physicians.

The legislation, as amended in the Senate Appropriations Committee, was approved 49-0.

Highlights of the amended House Bill 1802 include:

• The Collateral Source Rule will prohibit claimants from recovering damages for past medical expenses or past lost earnings that were paid or reimbursed by another source prior to trial.
• Periodic Payments will be authorized for future medical and related expenses in excess of $100,000. The payments will be made through an annuity, which will cease if the claimant dies. Periodic payments are authorized only in cases involving a verdict, not a settlement.
• Reduction to Present Value will require all other expenses, including past medical and related expenses, past and future loss of earnings and non-economic losses to be paid in a lump sum after being reduced to present value. For example, if a claimant’s future earnings total $1 million, the jury would reduce the future earnings award to a current amount that should equal $1 million if invested in a reasonably secure fixed income investment.
• A statute of repose will bar adults from instituting medical malpractice actions after seven years.
• Courts will be required to hold hearings on the motion of either party to determine if a verdict is excessive. Moving parties will not be required to post a bond in excess of insurance coverage.
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The MedCAT fund will be transferred to the Department of Insurance and renamed the Medical Care Availability and Reduction of Error Fund (MCARE Fund). A Third Party Administrator will administer the fund until it is phased out in 2009.

• Mandatory reductions will lower MCARE premiums 5 percent the first year. Premiums will drop an additional 10 percent in each of the next two years.

Beginning in January 2003, the minimum coverage limit will be reduced to $1 million. The current minimum coverage is $1.2 million.

The unfunded liability in the MCARE fund, estimated at more than $2 billion, will be reduced in part by money from the AutoCAT fund. Beginning January 1, 2004, collections for the AutoCAT fund will be sent to the MCARE fund. Those collections are expected to total approximately $400 million. The unfunded liability will also be reduced by surcharges paid by doctors and health care facilities. Half of the transfers from the AutoCAT fund will be directed to hospitals and the top four physician classes.

Also, 25 percent of any punitive damage awards will to the MCARE Fund.

A Patient Safety Authority will be created to serve as a clearinghouse for reports of "serious events" or "incidents" at health care facilities. Health care workers will be required to report serious events or incidents to Patient Safety Committees in each facility, and will be protected against employer retaliation.

The House concurred in Senate amendments 196-1, and the Governor signed the bill into law as Act 13 of 2002.

The Senate unanimously approved Senate Bill 106, which would add volunteer firefighter support service organization members to the individuals protected under the existing state law that prohibits the firing of employees who lose time from their jobs when performing their duties as emergency volunteers. The bill has been referred to the House Labor Relations Committee.

The Senate voted 49-0 to approve Senate Bill 1254, which would amend the Second Class Township Code to empower township boards of supervisors to authorize the attendance of supervisors or employees at court hearings or training and educational opportunities.

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