2017 Changes to Indiana Medical Malpractice

It’s important that Indiana’s healthcare providers understand the changes that will take effect on July 1, 2017 and again on July 1, 2019 to be ready to address their future malpractice insurance coverage.  On March 24, 2016 Governor Mike Pence signed into law Senate Bill 28 raising the Indiana medical malpractice cap on total damages.  What does that mean?  A brief history of the law may be helpful to understand the changes ahead.

In 1975 Indiana passed groundbreaking legislation to cap damages on medical liability claims in an effort to assure long-term accessibility, affordability and quality of health care for Indiana patients. The law created the Indiana Patient’s Compensation Fund (IN PCF) to pay claims over the provider’s primary malpractice insurance policy limit of liability.  The current damage cap is $1,250,000.  The physician purchases the first $250,000 layer through an insurance carrier and the second layer of $1,000,000 is obtained by paying a surcharge to the IN PCF.  The surcharge amount paid to the IN PCF is based on the physician’s specialty.

Effective July 1, 2017 the damage cap will increase to $1,650,000 which means the first layer through the insurance company will now be $400,000 and the second layer through the IN PCF will be $1,250,000.  The cap will increase again in 2019 to $1,800,000.

The premiums and the IN PCF surcharges are expected to rise over time with the increase in coverage needed to comply with the new legislation.  Our Medical Malpractice Team at Shepherd Insurance will keep you informed and will be ready to explain the changes and options available to you.  We invite you to call with your questions or concerns.

Click here to contact a member of our Medical Malpractice team.