Medical Society's Legal Actions Seek to Preserve Health Care Access and Mcare Relief
The Pennsylvania Medical Society has filed legal actions challenging the state’s right to money in the Mcare Fund and the Health Care Provider Retention Account (HCPRA).
In October 2009, the state General Assembly voted to transfer the HCPRA and Mcare Fund sums to the general fund to balance the state budget.
Two legal actions were filed months before the fund transfers. Others were filed immediately after the state budget was signed into law. Following is an update.
HCPRA/Mcare abatement lawsuit
In December 2008, the Society and HAP filed suits in Commonwealth Court, charging the state with underfunding the Mcare abatement program. From 2003 to 2007, the abatement program helped defray medical liability costs for Pennsylvania physicians.
The suit asserts that the abatement program has been underfunded by more than $400 million and seeks to have that money transferred from the HCPRA to fully fund the abatements.
After the suit was filed, the administration filed preliminary objections, asking the court to dismiss it for several reasons, including that the statute gave the administration discretion as to how much HCPRA money to transfer to Mcare.
However, in July 2009, the Commonwealth Court unanimously ruled that the suit should be permitted to proceed. While this decision is not a final decision on the merits, we believe this indicates that the court agrees with our position that the administration is mandated to fully fund the abatement program by transferring sufficient money from HCPRA.
The Society and HAP have filed a motion for summary relief asking the court to rule in our favor on the merits. Oral argument on this motion is tentatively scheduled for February 2009.
Mcare Fund administrative appeals
The Mcare Fund has ended the past few years with significant year-end fund balances. The Society and HAP believe the Mcare Fund is required by law to use those year-end balances to reduce assessments for physicians and hospitals the following year, but the fund has refused.
The Society and HAP appealed the 2009 and 2010 Mcare assessments to the Insurance Department. These appeals seek to force the use of year-end balances to reduce the next year’s assessment.
The 2009 assessment appeal has been stayed pending the outcome of the Mcare Fund raid lawsuit. Mcare also has requested that the 2010 assessment appeal be stayed.
Mcare Fund raid lawsuit
Immediately after the state budget was signed into law, the Society and HAP filed suits in Commonwealth Court challenging the state’s right to transfer $100 million from the Mcare Fund to the general fund.
The suit contended that the Mcare Fund balance was paid by physicians and hospitals for liability insurance coverage and that they have a right in those funds. It also contended that any attempt to appropriate those funds for another purpose is unconstitutional and that the taking of the Mcare Fund money constitutes an unconstitutional tax on physicians and hospitals.
As with the HCPRA lawsuit, the Medical Society and HAP have filed a motion for summary relief asking the court to rule in our favor on the merits and to expedite consideration of this motion.
Last Updated: 11/19/2009