HB 1293

CS

CHAMBER ACTION

1	The Health & Families Council recommends the following:
2
3	Council/Committee Substitute
4	Remove the entire bill and insert:
5	A bill to be entitled
6	An act relating to medical malpractice insurance;
7	providing a short title; creating the Patient Safety and
8	Provider Liability Act; providing legislative findings;
9	amending s. 766.110, F.S.; specifying certain authorized
10	insurers who may make available liability insurance;
11	amending s. 766.118, F.S.; providing a limitation on
12	noneconomic damages for a hospital facility that complies
13	with certain patient-safety measures; creating s. 766.401,
14	F.S.; providing definitions; creating s. 766.402, F.S.;
15	authorizing an eligible hospital to petition the agency
16	for an order certifying the hospital as a certified
17	patient-safety facility; providing requirements for
18	certification as a patient-safety facility; authorizing
19	the agency to conduct onsite examinations; providing for
20	revocation of an order certifying approval of a certified
21	patient-safety facility; providing that an order
22	certifying the approval of a certified patient-safety
23	facility is conclusive evidence of compliance with
24	statutory patient-safety requirements; providing that
25	evidence of noncompliance is not admissible for any action
26	for medical malpractice; creating s. 766.403, F.S.;
27	providing requirements for a hospital to demonstrate that
28	it is engaged in a common enterprise for the care and
29	treatment of patients; specifying required patient-safety
30	measures; prohibiting a report or document generated under
31	the act from being admissible or discoverable as evidence;
32	creating s. 766.404, F.S.; requiring a certified patient-
33	safety facility to submit an annual report to the agency
34	and the Legislature; providing requirements for the annual
35	report; providing that the annual report may include
36	certain information from the Office of Insurance
37	Regulation within the Department of Financial Services;
38	providing that the annual report is subject to public-
39	records requirements but is not admissible as evidence in
40	a legal proceeding; creating s. 766.405, F.S.; providing
41	for limitations on damages for eligible hospitals that are
42	certified for compliance with certain patient-safety
43	measures; creating s. 766.406, F.S.; providing rulemaking
44	authority; providing for severability; providing for broad
45	statutory view of the act; providing for self-execution of
46	the act; providing an effective date.
47
48	Be It Enacted by the Legislature of the State of Florida:
49
50	Section 1.  Short title.--This act may be cited as the
51	"Patient Safety and Provider Liability Act."
52	Section 2.  Legislative findings.--The Legislature finds
53	that:
54	(1)  This state is in the midst of a prolonged medical
55	malpractice insurance crisis that has serious adverse effects on
56	patients, practitioners, licensed health care facilities, and
57	all residents of this state.
58	(2)  Hospitals are central components of the modern health
59	care delivery system.
60	(3)  The medical malpractice insurance crisis in this state
61	can be alleviated by the adoption of innovative approaches for
62	patient safety in teaching hospitals, which can lead to a
63	reduction in medical errors coupled with a limitation on
64	noneconomic damages that can be awarded against a teaching
65	hospital that implements such innovative approaches.
66	(4)  Statutory incentives are necessary to facilitate
67	innovative approaches for patient safety in hospitals and that
68	such incentives and patient-safety measures will benefit all
69	persons seeking health care services in this state.
70	(5)  Coupling patient safety measures and a limitation on
71	provider liability in teaching hospitals will lead to a
72	reduction in the frequency and severity of incidents of medical
73	malpractice in hospitals.
74	(6)  A reduction in the frequency and severity of incidents
75	of medical malpractice in hospitals will reduce attorney's fees
76	and other expenses inherent in the medical liability system.
77	(7)  There is no alternative method that addresses the
78	overwhelming public necessity to implement patient-safety
79	measures and limit provider liability.
80	(8)  Making high-quality health care available to the
81	residents of this state is an overwhelming public necessity.
82	(9)  Medical education in this state is an overwhelming
83	public necessity.
84	(10)  Statutory teaching hospitals are essential for high-
85	quality medical care and medical education in this state.
86	(11)  The critical mission of statutory teaching hospitals
87	is severely undermined by the ongoing medical malpractice
88	crisis.
89	(12)  Teaching hospitals are appropriate health care
90	facilities for the implementation of innovative approaches to
91	enhancing patient safety and limiting provider liability.
92	(13)  There is an overwhelming public necessity to impose
93	reasonable limitations on actions for medical malpractice
94	against teaching hospitals in furtherance of the critical public
95	interest in promoting access to high-quality medical care,
96	medical education, and innovative approaches to patient safety
97	and provider liability.
98	(14)  There is an overwhelming public necessity for
99	teaching hospitals to implement innovative measures for patient
100	safety and limit provider liability in order to generate
101	empirical data for state policymakers concerning the
102	effectiveness of these measures. Such data may lead to broader
103	application of these measures in a wider array of hospitals
104	after a reasonable period of evaluation and review.
105	(15)  There is an overwhelming public necessity to promote
106	the academic mission of teaching hospitals. Furthermore, the
107	Legislature finds that the academic mission of these medical
108	facilities is materially enhanced by statutory authority for the
109	implementation of innovative approaches to promoting patient
110	safety and limiting provider liability. Such approaches can be
111	carefully studied and learned by medical students, medical
112	school faculty, and affiliated physicians in appropriate
113	clinical settings, thereby enlarging the body of knowledge
114	concerning patient safety and provider liability which is
115	essential for advancement of patient safety, reduction of
116	expenses inherent in the medical liability system, and
117	curtailment of the medical malpractice insurance crisis in this
118	state.
119	Section 3.  Subsection (2) of section 766.110, Florida
120	Statutes, is amended to read:
121	766.110  Liability of health care facilities.--
122	(2)  Every hospital licensed under chapter 395 may carry
123	liability insurance or adequately insure itself in an amount of
124	not less than $1.5 million per claim, $5 million annual
125	aggregate to cover all medical injuries to patients resulting
126	from negligent acts or omissions on the part of those members of
127	its medical staff who are covered thereby in furtherance of the
128	requirements of ss. 458.320 and 459.0085. Notwithstanding s.
129	626.901, a licensed hospital may extend insurance and self-
130	insurance coverage to members of the medical staff, including
131	physicians' practices, individually or through a professional
132	association, as defined in chapter 621, and other health care
133	practitioners, as defined in s. 456.001(4), including students
134	preparing for licensure. Such coverage shall be limited to legal
135	liability arising out of medical negligence within the hospital
136	premises as defined under s. 766.401. Self-insurance Coverage
137	extended hereunder to a member of a hospital's medical staff
138	meets the financial responsibility requirements of ss. 458.320
139	and 459.0085 if the physician's coverage limits are not less
140	than the minimum limits established in ss. 458.320 and 459.0085
141	and the hospital is a verified trauma center that has extended
142	self-insurance coverage continuously to members of its medical
143	staff for activities both inside and outside of the hospital.
144	Any authorized insurer, approved insurer as described in s.
145	626.914(2), risk retention group as defined in s. 627.942, or
146	joint underwriting association established under s. 627.351(4)
147	which is approved or authorized to write casualty insurance may
148	make available, but is shall not be required to write, such
149	coverage. The hospital may assess on an equitable and pro rata
150	basis the following individuals to whom it extends coverage
151	pursuant to this section professional health care providers for
152	a portion of the total hospital insurance cost for this
153	coverage: physicians licensed under chapter 458, osteopathic
154	physicians licensed under chapter 459, podiatric physicians
155	licensed under chapter 461, dentists licensed under chapter 466,
156	and nurses licensed under part I of chapter 464, and other
157	health professionals. The hospital may provide for a deductible
158	amount to be applied against any individual health care provider
159	found liable in a law suit in tort or for breach of contract.
160	The legislative intent in providing for the deductible to be
161	applied to individual health care providers found negligent or
162	in breach of contract is to instill in each individual health
163	care provider the incentive to avoid the risk of injury to the
164	fullest extent and ensure that the citizens of this state
165	receive the highest quality health care obtainable.
166	Section 4.  Present subsections (6) and (7) of section
167	766.118, Florida Statutes, are renumbered as subsections (7) and
168	(8), respectively, and a new subsection (6) is added to that
169	section, to read:
170	766.118  Determination of noneconomic damages.--
171	(6)  LIMITATION ON NONECONOMIC DAMAGES FOR NEGLIGENCE OF
172	CERTAIN HOSPITALS.--With respect to a complaint for personal
173	injury or wrongful death arising from medical negligence, a
174	hospital that has received an order from the Agency for Health
175	Care Administration pursuant to s. 766.402 which certifies that
176	the facility complies with patient-safety measures specified in
177	s. 766.403 shall be liable for no more than $500,000 in
178	noneconomic damages, regardless of the number of claimants,
179	number of claims, or theory of liability, including vicarious
180	liability, arising from the same nucleus of operative fact,
181	notwithstanding any other provision of this section.
182	Section 5.  Section 766.401, Florida Statutes, is created
183	to read:
184	766.401  Definitions.--As used in this section and ss.
185	766.402-766.405, the term:
186	(1)  "Affected patient" means a patient of a certified
187	patient-safety facility.
188	(2)  "Affected practitioner" means any person, including a
189	physician, who is credentialed by the eligible hospital to
190	provide health care services in a certified patient-safety
191	facility.
192	(3)  "Agency" means the Agency for Health Care
193	Administration.
194	(4)  "Certified patient-safety facility" means any eligible
195	hospital that, in accordance with an order from the Agency for
196	Health Care Administration, has adopted a patient-safety plan.
197	(5)  "Clinical privileges" means the privileges granted to
198	a physician or other licensed health care practitioner to render
199	patient-care services in a hospital.
200	(6)  "Eligible hospital" or "licensed facility" means a
201	statutory teaching hospital, as defined by s. 408.07, which
202	maintains at least seven different accredited programs in
203	graduate medical education and has 100 or more full-time
204	equivalent resident physicians.
205	(7)  "Health care provider" or "provider" means:
206	(a)  An eligible hospital.
207	(b)  A physician or a physician assistant licensed under
208	chapter 458.
209	(c)  An osteopathic physician or an osteopathic physician
210	assistant licensed under chapter 459.
211	(d)  A registered nurse, nurse midwife, licensed practical
212	nurse, or advanced registered nurse practitioner licensed or
213	registered under part I of chapter 464 or any facility that
214	employs nurses licensed or registered under part I of chapter
215	464 to supply all or part of the care delivered by that
216	facility.
217	(e)  A health care professional association and its
218	employees or a corporate medical group and its employees.
219	(f)  Any other medical facility in which the primary
220	purpose is to deliver human medical diagnostic services or to
221	deliver nonsurgical human medical treatment, including an office
222	maintained by a provider.
223	(g)  A free clinic that delivers only medical diagnostic
224	services or nonsurgical medical treatment free of charge to low-
225	income persons not otherwise covered by Medicaid or other
226	programs for low-income persons.
227	(h)  Any other health care professional, practitioner, or
228	provider, including a student enrolled in an accredited program,
229	who prepares the student for licensure as any one of the
230	professionals listed in this subsection.
231	(i)  Any person, organization, or entity that is
232	vicariously liable under the theory of respondeat superior or
233	any other theory of legal liability for medical negligence
234	committed by any licensed professional listed in this
235	subsection.
236	(j)  Any nonprofit corporation qualified as exempt from
237	federal income taxation under s. 501(a) of the Internal Revenue
238	Code and described in s. 501(c) of the Internal Revenue Code,
239	including any university or medical school that employs licensed
240	professionals listed in this subsection or which delivers health
241	care services provided by licensed professionals listed in this
242	subsection, any federally funded community health center, and
243	any volunteer corporation or volunteer health care provider that
244	delivers health care services.
245	(8)  "Health care practitioner" or "practitioner" means any
246	person, entity, or organization identified in subsection (7),
247	except for a hospital.
248	(9)  "Medical incident" or "adverse incident" has the same
249	meaning as provided in ss. 381.0271, 395.0197, 458.351, and
250	459.026.
251	(10)  "Medical negligence" means medical malpractice,
252	whether grounded in tort or in contract, arising out of the
253	rendering of or failure to render medical care or services.
254	(11)  "Person" means any individual, partnership,
255	corporation, association, or governmental unit.
256	(12)  "Premises" means those buildings, beds, and equipment
257	located at the address of the licensed facility and all other
258	buildings, beds, and equipment for the provision of the
259	hospital, ambulatory surgical, mobile surgical care, primary
260	care, or comprehensive health care under the dominion and
261	control of the licensee, including offices and locations where
262	the licensed facility offers medical care and treatment to
263	affected patients.
264	(13)  "Statutory teaching hospital" or "teaching hospital"
265	has the same meaning as provided in s. 408.07.
266	Section 6.  Section 766.402, Florida Statutes, is created
267	to read:
268	766.402  Agency approval of patient-safety plans.--
269	(1)  An eligible hospital that has adopted a patient-safety
270	plan may petition the agency to enter an order certifying
271	approval of the hospital as a certified patient-safety facility.
272	(2)  In accordance with chapter 120, the agency shall enter
273	an order certifying approval of the certified patient-safety
274	facility upon a showing that, in furtherance of an approach to
275	patient safety:
276	(a)  The petitioner has established safety measures for the
277	care and treatment of patients.
278	(b)  The petitioner satisfies requirements for patient-
279	protection measures, as specified in s. 766.403.
280	(c)  The petitioner satisfies all other requirements of ss.
281	766.401-766.405.
282	(3)  Upon entry of an order approving the petition, the
283	agency may conduct onsite examinations of the licensed facility
284	to ensure continued compliance with the terms and conditions of
285	the order.
286	(4)  The order approving a petition under this section
287	remains in effect until revoked. The agency may revoke the order
288	upon reasonable notice to the eligible hospital that it fails to
289	comply with material requirements of s. 766.403 and that the
290	hospital has failed to cure stated deficiencies upon reasonable
291	notice. Revocation of an agency order pursuant to s. 766.403
292	applies prospectively to any cause of action for medical
293	negligence which arises on or after the effective date of the
294	order of revocation.
295	(5)  An order approving a petition under this section is,
296	as a matter of law, conclusive evidence that the hospital
297	complies with the applicable patient-safety requirements of s.
298	766.403. A hospital's noncompliance with the requirements of s.
299	766.403 does not affect the limitations on damages conferred by
300	this section. Evidence of noncompliance with s. 766.403 is not
301	admissible for any purpose in any action for medical
302	malpractice. This section, or any portion thereof, may not give
303	rise to an independent cause of action for damages against any
304	hospital.
305	Section 7.  Section 766.403, Florida Statutes, is created
306	to read:
307	766.403  Patient-safety plans.--
308	(1)  In order to satisfy the requirements of s. 766.402,
309	the licensed facility shall have a patient-safety plan, which
310	provides that the facility shall:
311	(a)  Have in place a process, either through the facility's
312	patient-safety committee or a similar body, for coordinating the
313	quality control, risk management, and patient-relations
314	functions of the facility and for reporting to the facility's
315	governing board at least quarterly regarding such efforts.
316	(b)  Establish within the facility a system for reporting
317	near misses and agree to submit any information collected to the
318	Florida Patient Safety Corporation. Such information must be
319	submitted by the facility and made available by the Patient
320	Safety Corporation in accordance with s. 381.0271(7).
321	(c)  Design and make available to facility staff, including
322	medical staff, a patient-safety curriculum that provides lecture
323	and web-based training on recognized patient-safety principles,
324	which may include training in communication skills, team-
325	performance assessment and training, risk-prevention strategies,
326	and best practices and evidence-based medicine. The licensed
327	facility shall report annually the programs presented to the
328	agency.
329	(d)  Implement a program to identify health care providers
330	on the facility's staff who may be eligible for an early-
331	intervention program that provides additional skills assessment
332	and training and offer such training to the staff on a voluntary
333	and confidential basis with established mechanisms to assess
334	program performance and results.
335	(e)  Implement a simulation-based program for skills
336	assessment, training, and retraining of a facility's staff in
337	those tasks and activities that the agency identifies by rule.
338	(f)  Designate a patient advocate who coordinates with
339	members of the medical staff and the facility's chief medical
340	officer regarding the disclosure of adverse medical incidents to
341	patients. In addition, the patient advocate shall establish an
342	advisory panel, consisting of providers, patients or their
343	families, and other health care consumers or consumer groups to
344	review general patient-safety concerns and other issues related
345	to relations among and between patients and providers and to
346	identify areas where additional education and program
347	development may be appropriate.
348	(g)  Establish a procedure to biennially review the
349	facility's patient-safety program and its compliance with the
350	requirements of this section. Such review shall be conducted by
351	an independent patient-safety organization as defined in s.
352	766.1016(1) or other professional organization approved by the
353	agency. The organization performing the review shall prepare a
354	written report that contains detailed findings and
355	recommendations. The report shall be forwarded to the facility's
356	risk manager or patient-safety officer, who may make written
357	comments in response. The report and any written comments shall
358	be presented to the governing board of the licensed facility. A
359	copy of the report and any of the facility's responses to the
360	findings and recommendations shall be provided to the agency
361	within 60 days after the date that the governing board reviewed
362	the report. The report is confidential and exempt from
363	production or discovery in any civil action. Likewise, the
364	report and the information contained therein are not admissible
365	as evidence for any purpose in any action for medical
366	negligence.
367	(h)  Establish a system for the trending and tracking of
368	quality and patient-safety indicators that the agency may
369	identify by rule and a method for review of the data at least
370	semiannually by the facility's patient-safety committee.
371	(2)  This section does not constitute an applicable
372	standard of care in any action for medical negligence or
373	otherwise create a private right of action, and evidence of
374	noncompliance with this section is not admissible for any
375	purpose in any action for medical negligence against any health
376	care provider.
377	(3)  This section does not prohibit the licensed facility
378	from implementing other measures for promoting patient safety
379	within the premises. This section does not relieve the licensed
380	facility from the duty to implement any other patient-safety
381	measure that is required by state law. The Legislature intends
382	that the patient-safety measures specified in this section are
383	in addition to all other patient-safety measures required by
384	state law, federal law, and applicable accreditation standards
385	for licensed facilities.
386	(4)  A review, report, or other document created, produced,
387	delivered, or discussed pursuant to this section is not
388	discoverable or admissible as evidence in any legal action.
389	Section 8.  Section 766.404, Florida Statutes, is created
390	to read:
391	766.404  Annual report.--
392	(1)  Each certified patient-safety facility shall submit an
393	annual report to the agency containing information and data
394	reasonably required by the agency to evaluate performance and
395	effectiveness of its patient-safety plan. However, information
396	may not be submitted or disclosed in violation of any patient's
397	right to privacy under state or federal law.
398	(2)  The agency shall aggregate information and data
399	submitted by all certified patient-safety facilities, and each
400	year, on or before March 1, the agency shall submit a report to
401	the President of the Senate and the Speaker of the House of
402	Representatives which evaluates the performance and
403	effectiveness of the approach to enhancing patient safety and
404	limiting provider liability in certified patient-safety
405	facilities. The report must include, but need not be limited to,
406	pertinent data concerning:
407	(a)  The number and names of certified patient-safety
408	facilities;
409	(b)  The number and types of patient-protection measures
410	currently in effect in these facilities;
411	(c)  The number of affected patients;
412	(d)  The number of surgical procedures on affected
413	patients;
414	(e)  The number of medical incidents, claims of medical
415	malpractice, and claims resulting in indemnity;
416	(f)  The average time for resolution of contested and
417	uncontested claims of medical malpractice;
418	(g)  The percentage of claims which result in civil trials;
419	(h)  The percentage of civil trials which result in adverse
420	judgments against affected facilities;
421	(i)  The number and average size of an indemnity paid to
422	claimants;
423	(j)  The estimated liability expense, inclusive of medical
424	liability insurance premiums; and
425	(k)  The percentage of medical liability expense, inclusive
426	of medical liability insurance premiums, which is borne by
427	affected practitioners in certified patient-safety facilities.
428
429	The report may also include other information and data that the
430	agency deems appropriate to gauge the cost and benefit of
431	patient-safety plans.
432	(3)  The agency's annual report to the President of the
433	Senate and the Speaker of the House of Representatives may
434	include relevant information and data obtained from the Office
435	of Insurance Regulation within the Department of Financial
436	Services concerning the availability and affordability of
437	enterprise-wide medical liability insurance coverage for
438	affected facilities and the availability and affordability of
439	insurance policies for individual practitioners which contain
440	coverage exclusions for acts of medical negligence in facilities
441	that indemnify health practitioners. The Office of Insurance
442	Regulation shall cooperate with the agency in the reporting of
443	information and data specified in this subsection.
444	(4)  Reports submitted to the agency by certified patient-
445	safety facilities pursuant to this section are public records
446	under chapter 119. However, these reports, and the information
447	contained therein, are not admissible as evidence in a court of
448	law in any action.
449	Section 9.  Section 766.405, Florida Statutes, is created
450	to read:
451	766.405  Damages in malpractice actions against certain
452	hospitals that meet patient-safety requirements; agency approval
453	of patient-safety measures.--
454	(1)  In recognition of their essential role in training
455	future health care providers and in providing innovative medical
456	care for this state's residents, in recognition of their
457	commitment to treating indigent patients, and further in
458	recognition that teaching hospitals, as defined in s. 408.07,
459	provide benefits to the residents of this state through their
460	roles in improving the quality of medical care, training of
461	health care providers, and caring for indigent patients, the
462	limits of liability for medical malpractice arising out of the
463	rendering of, or the failure to render, medical care by all such
464	hospitals shall be determined in accordance with the
465	requirements of this section.
466	(2)  Upon entry of an order and for the entire period of
467	time that the order remains in effect, the damages recoverable
468	from an eligible hospital covered by the order and from its
469	full-time physician employees, full-time and part-time
470	nonphysician employees, and agents in actions arising from
471	medical negligence shall be determined in accordance with the
472	following provisions:
473	(a)  Noneconomic damages shall be limited to a maximum of
474	$500,000, regardless of the number of claimants, number of
475	claims, or the theory of liability pursuant to s. 766.118(6).
476	(b)  Awards of economic damages shall be offset by payments
477	from collateral sources, as defined by s. 766.202(2), and any
478	set-offs available under ss. 46.015 and 768.041. Awards for
479	future economic losses shall be offset by future collateral
480	source payments.
481	(c)  After being offset by collateral sources, awards of
482	future economic damages shall, at the option of the eligible
483	hospital, be reduced by the court to present value or paid
484	through periodic payments in the form of an annuity or a
485	reversionary trust. A company that underwrites an annuity to pay
486	future economic damages shall have a rating of "A" or higher by
487	A.M. Best Company. The terms of the reversionary instrument used
488	to periodically pay future economic damages must be approved by
489	the court. Such approval may not be unreasonably withheld.
490	(3)  The limitations on damages in subsection (2) apply
491	prospectively to causes of action for medical negligence which
492	arise on or after the effective date of the order.
493	Section 10.  Section 766.406, Florida Statutes, is created
494	to read:
495	766.406  Rulemaking authority.--The agency may adopt rules
496	pursuant to ss. 120.536(1) and 120.54 to administer ss.
497	766.401-766.405.
498	Section 11.  If any provision of this act or its
499	application to any person or circumstance is held invalid, the
500	invalidity does not affect other provisions or applications of
501	the act which can be given effect without the invalid provision
502	or application, and to this end, the provisions of this act are
503	severable.
504	Section 12.  If a conflict exists between any provision of
505	this act and s. 456.052, s. 456.053, s. 456.054, s. 458.331, s.
506	459.015, or s. 817.505, Florida Statutes, the provisions of this
507	act shall govern. The provisions of this act shall be broadly
508	construed in furtherance of the overriding legislative intent to
509	facilitate innovative approaches for enhancing patient
510	protection and limiting provider liability in eligible
511	hospitals.
512	Section 13.  It is the intention of the Legislature that
513	the provisions of this act are self-executing.
514	Section 14.  This act shall take effect upon becoming a
515	law.

CODING: Words stricken are deletions; words underlined are additions.