Letter to Lawmakers on Mcare Fund Raid
I am writing on behalf of the Pennsylvania Medical Society to express our strong opposition to the use of $100 million of physician and hospital premium dollars from the Mcare Fund to balance the state budget. Diverting liability insurance assessments paid by hospitals, individual physicians and other health care providers to the General Fund is bad public policy, and a breach of faith with the state’s provider community. We urge you to vote against this proposal.
The state-run Mcare Fund provides mandated liability insurance coverage to hospitals, physicians and other providers, and in turn charges those providers an annual assessment (premium) to pay for that coverage. While the Fund has been supplemented by automobile moving violation surcharges since 2004, this money was committed to and spent on the discount and abatement programs. It is not part of the current Mcare Fund balance.
Let me be clear about the current Mcare balance. It has resulted from excess premiums paid by physicians, hospitals, nurse midwives, podiatrists and nursing homes.
Additionally, the Mcare Fund balance is the subject of an ongoing administrative appeal before the Insurance Department filed by the Pennsylvania Medical Society, the Hospital and Healthsystem Association of Pennsylvania and the Pennsylvania Podiatric Medical Association. In that litigation, both the Medical Society and the Mcare Fund have said that the existing balance should be used for the benefit of patient care providers, either to pay claims and expenses or to lower Mcare assessments.
In view of the litigation and the fact that the Mcare Fund balance was generated by premiums paid by hospitals, physicians and other providers, we strongly oppose the proposal to use any portion of the Mcare Fund balance to balance the state budget. Pennsylvania physicians already pay some of the highest liability insurance premiums in the nation, and appropriating those premium dollars for other purposes will send a devastating message to medical students and residents who are deciding where to provide patient care.
By taking more than $700 million of the Health Care Provider Retention Account balance (also the subject of litigation), another $100 million of the Mcare Fund balance and millions more in hospital cuts, the state is balancing the budget on the backs of health care providers. We believe this is legally wrong, bad public policy and a breach of faith with Pennsylvania patients and physicians.
Please vote no on the budget proposal.
Sincerely,
Daniel J. Glunk, MD
President
Last Updated: 9/24/2009