Enough is enough. That appears to be the message of a Senate proposal, which, if enacted, finally could settle a score between New Hampshire and a medical malpractice insurance fund. The two-year-old controversy is about whether the state can claim surplus funds held by the New Hampshire Medical Malpractice Joint Underwriting Association (JUA).
The Senate Executive Departments and Administration Committee will hold a public hearing Thursday on Senate Bill 170, sponsored by Sen. Sharon Carson (R-Londonderry). The bill would prohibit the state from using any JUA funds and allow the organization to distribute surplus funds back to shareholders — medical providers who buy their malpractice insurance policies through the JUA.
The political controversy erupted in 2009 when Gov. John Lynch and Democratic budget writers tried to transfer $110 million from the JUA into the state’s general fund to help balance the budget for 2010 and 2011. The move became a political flashpoint as JUA shareholders were joined by Republicans in fighting the transfer, saying lawmakers had no right to it. But, the Lynch administration said the people of New Hampshire had established the JUA and had a right to benefit from those surplus funds.
The JUA sued and won. The N.H. Supreme Court essentially said that the tax-exempt JUA is a private agency, even though the IRS allows it to function as a tax-exempt part of state government. A bid to change JUA rules last fall through the state insurance department, which administers and appoints board directors to the JUA, also ran into resistance by a joint legislative committee and was eventually abandoned.
The JUA was founded in 1981 by the Legislature to help medical providers find affordable medical malpractice insurance through a state-administered non-for-profit agency. Senate Bill 170 proposes that any of its excess funds be distributed to shareholders after all tax liability issues have been settled. Any excess funds that have not been distributed “shall be used to provide grants in aid to health care providers servicing medically underserved populations to assist in the NHMMJUA coverage.”
Already, eight senators and four representatives have joined Sen. Carson as co-sponsors of SB 170.
>> Thursday, Feb. 10 — Public Hearing of SB 170 before the Senate Executive Departments and Administration Committee, Room 100 at the State House, 9:50 a.m. Executive session may follow.
>> You can find out more about SB 170 in a recent New Hampshire Business Review story and read state Insurance Commissioner Roger Sevigny’s explanation of how NHMMJUA works and his defense of using the agency’s funds by the state here.
This Daily Dispatch was written by Michael McCord.