HB 565

1	A bill to be entitled
2	An act relating to the financial responsibility of
3	physicians and osteopathic physicians; amending ss.
4	458.320 and 459.0085, F.S.; providing additional licensure
5	requirements for professional liability insurance
6	coverage, an escrow account, and an irrevocable letter of
7	credit; revising the amounts required through the escrow
8	account or letter of credit; providing for submittal, to
9	the Department of Health, by a physician or an osteopathic
10	physician of a sworn statement and documentation relating
11	to the liability insurance coverage, the escrow account,
12	or the letter of credit; providing for notification of the
13	department by a bank or savings association when the
14	escrow account is closed or transferred or the letter of
15	credit is canceled or expires; removing provisions
16	governing license suspension following cancellation or
17	nonrenewal of professional liability insurance; providing
18	for notification of the department and requiring a sworn
19	statement by the physician or osteopathic physician when
20	the professional liability insurance is canceled or not
21	renewed, the escrow account is closed or transferred, or
22	the letter of credit is canceled or expires; providing for
23	license suspension following such termination of
24	insurance, escrow account, or letter of credit; providing
25	criminal penalties for a physician or an osteopathic
26	physician who fails to submit a required notice or
27	statement, who knowingly makes a false declaration in the
28	sworn statement, or who fails to timely file the sworn
29	statement; removing provisions authorizing a physician or
30	osteopathic physician to be exempt from the financial
31	responsibility requirements upon posting notice and
32	meeting certain other criteria; providing that
33	requirements previously applicable to self-insured
34	physicians and osteopathic physicians apply to all such
35	physicians who are required to maintain financial
36	responsibility; requiring that a physician or osteopathic
37	physician satisfy an adverse final judgment within a
38	specified period unless otherwise agreed to in writing;
39	providing that a physician or osteopathic physician is not
40	relieved from his or her obligation to satisfy the entire
41	amount of a judgment or award; requiring the department to
42	suspend the license of a physician or osteopathic
43	physician upon the mailing of a notice of failure to
44	satisfy an adverse final judgment; providing an exemption
45	for certain physicians or osteopathic physicians for
46	payment to a judgment creditor; requiring the department
47	to verify that a physician or osteopathic physician has
48	met financial responsibility requirements before granting
49	or renewing a license; requiring the Board of Medicine and
50	the Board of Osteopathic Medicine to adopt rules;
51	providing an effective date.
52
53	Be It Enacted by the Legislature of the State of Florida:
54
55	Section 1.  Section 458.320, Florida Statutes, is amended
56	to read:
57	458.320  Financial responsibility.--
58	(1)  As a condition of licensing and maintaining an active
59	license, and prior to the issuance or renewal of an active
60	license or reactivation of an inactive license for the practice
61	of medicine, an applicant must by one of the following methods
62	demonstrate to the satisfaction of the board and the department
63	financial responsibility to pay claims and costs ancillary
64	thereto arising out of the rendering of, or the failure to
65	render, medical care and or services:
66	(a)  Establishing and maintaining an escrow account
67	consisting of cash or assets eligible for deposit in accordance
68	with s. 625.52 in an amount sufficient to meet the minimum
69	annual aggregate claim amount the per claim amounts specified in
70	paragraph (b). The escrow account must be payable to the
71	physician as beneficiary upon presentation of a final judgment
72	indicating liability and awarding damages to be paid by the
73	physician or upon presentation of a settlement agreement signed
74	by all parties to such agreement when such final judgment or
75	settlement is a result of a claim arising out of the rendering
76	of, or the failure to render, medical care and services. The
77	required escrow amount set forth in this paragraph may not be
78	used for litigation costs or attorney's fees for the defense of
79	any medical malpractice claim. The escrow account must be
80	nonassignable and nontransferable. Such escrow account must be
81	made with and held by the trust department of a bank or saving
82	association organized and existing under the laws of this state
83	or a bank or savings association organized under the laws of the
84	United States which has its principal place of business in this
85	state or has a branch office that is authorized under the laws
86	of this state or of the United States to receive deposits in
87	this state.
88	(b)  Obtaining and maintaining professional liability
89	coverage in an amount not less than $100,000 per claim, with a
90	minimum annual aggregate of not less than $300,000, from an
91	authorized insurer as defined under s. 624.09, from a surplus
92	lines insurer as defined under s. 626.914(2), from a risk
93	retention group as defined under s. 627.942, from the Joint
94	Underwriting Association established under s. 627.351(4), or
95	through a plan of self-insurance as provided in s. 627.357. The
96	required coverage amount set forth in this paragraph may not be
97	used for litigation costs or attorney's fees for the defense of
98	any medical malpractice claim.
99	(c)  Obtaining and maintaining an unexpired, irrevocable
100	letter of credit, established pursuant to chapter 675, in an
101	amount sufficient to meet the minimum annual aggregate claim
102	amount specified in paragraph (b) not less than $100,000 per
103	claim, with a minimum aggregate availability of credit of not
104	less than $300,000. The letter of credit must be payable to the
105	physician as beneficiary upon presentment of a final judgment
106	indicating liability and awarding damages to be paid by the
107	physician or upon presentment of a settlement agreement signed
108	by all parties to such agreement when such final judgment or
109	settlement is a result of a claim arising out of the rendering
110	of, or the failure to render, medical care and services. The
111	letter of credit may not be used for litigation costs or
112	attorney's fees for the defense of any medical malpractice
113	claim. The letter of credit must be nonassignable and
114	nontransferable. Such letter of credit must be issued by any
115	bank or savings association organized and existing under the
116	laws of this state or any bank or savings association organized
117	under the laws of the United States which has its principal
118	place of business in this state or has a branch office that is
119	authorized under the laws of this state or of the United States
120	to receive deposits in this state.
121	(2)  Physicians who perform surgery in an ambulatory
122	surgical center licensed under chapter 395 and, as a continuing
123	condition of hospital staff privileges, physicians who have
124	staff privileges must also establish financial responsibility by
125	one of the following methods:
126	(a)  Establishing and maintaining an escrow account
127	consisting of cash or assets eligible for deposit in accordance
128	with s. 625.52 in an amount sufficient to meet the minimum
129	annual aggregate claim amount the per claim amounts specified in
130	paragraph (b). The escrow account must be payable to the
131	physician as beneficiary upon presentation of a final judgment
132	indicating liability and awarding damages to be paid by the
133	physician or upon presentation of a settlement agreement signed
134	by all parties to such agreement when such final judgment or
135	settlement is a result of a claim arising out of the rendering
136	of, or the failure to render, medical care and services. The
137	required escrow amount set forth in this paragraph may not be
138	used for litigation costs or attorney's fees for the defense of
139	any medical malpractice claim. The escrow account must be
140	nonassignable and nontransferable. Such escrow account must be
141	made with and held by the trust department of a bank or savings
142	association organized and existing under the laws of this state
143	or a bank or savings association organized under the laws of the
144	United States which has its principal place of business in this
145	state or has a branch office that is authorized under the laws
146	of this state or of the United States to receive deposits in
147	this state.
148	(b)  Obtaining and maintaining professional liability
149	coverage in an amount not less than $250,000 per claim, with a
150	minimum annual aggregate of not less than $750,000 from an
151	authorized insurer as defined under s. 624.09, from a surplus
152	lines insurer as defined under s. 626.914(2), from a risk
153	retention group as defined under s. 627.942, from the Joint
154	Underwriting Association established under s. 627.351(4),
155	through a plan of self-insurance as provided in s. 627.357, or
156	through a plan of self-insurance which meets the conditions
157	specified for satisfying financial responsibility in s. 766.110.
158	The required coverage amount set forth in this paragraph may not
159	be used for litigation costs or attorney's fees for the defense
160	of any medical malpractice claim.
161	(c)  Obtaining and maintaining an unexpired irrevocable
162	letter of credit, established pursuant to chapter 675, in an
163	amount sufficient to meet the minimum annual aggregate claim
164	amount specified in paragraph (b) not less than $250,000 per
165	claim, with a minimum aggregate availability of credit of not
166	less than $750,000. The letter of credit must be payable to the
167	physician as beneficiary upon presentment of a final judgment
168	indicating liability and awarding damages to be paid by the
169	physician or upon presentment of a settlement agreement signed
170	by all parties to such agreement when such final judgment or
171	settlement is a result of a claim arising out of the rendering
172	of, or the failure to render, medical care and services. The
173	letter of credit may not be used for litigation costs or
174	attorney's fees for the defense of any medical malpractice
175	claim. The letter of credit must be nonassignable and
176	nontransferable. The letter of credit must be issued by any bank
177	or savings association organized and existing under the laws of
178	this state or any bank or savings association organized under
179	the laws of the United States which has its principal place of
180	business in this state or has a branch office that is authorized
181	under the laws of this state or of the United States to receive
182	deposits in this state.
183
184	This subsection shall be inclusive of the coverage in subsection
185	(1).
186	(3)(a)  Meeting the financial responsibility requirements
187	of this section or the criteria for any exemption from such
188	requirements must be established at the time of issuance or
189	renewal of a license.
190	(b)  Any person may, at any time, submit to the department
191	a request for an advisory opinion regarding such person's
192	qualifications for exemption.
193	(4)(a)  If financial responsibility requirements are met by
194	maintaining professional liability insurance as provided for in
195	this section, the physician shall, at the time of applying for
196	or renewing a license, and within 10 days after any such
197	insurance coverage is instituted, submit to the department a
198	sworn statement identifying the insurer and certifying that the
199	coverage meets the requirements of this section. The statement
200	shall be accompanied by a copy of the certificate of insurance
201	and is considered to be incorporated in the statement. Each
202	insurer, self-insurer, risk retention group, or Joint
203	Underwriting Association must promptly notify the department of
204	cancellation or nonrenewal of insurance required by this
205	section. Unless the physician demonstrates that he or she is
206	otherwise in compliance with the requirements of this section,
207	the department shall suspend the license of the physician
208	pursuant to ss. 120.569 and 120.57 and notify all health care
209	facilities licensed under chapter 395 of such action. Any
210	suspension under this subsection remains in effect until the
211	physician demonstrates compliance with the requirements of this
212	section. If any judgments or settlements are pending at the time
213	of suspension, those judgments or settlements must be paid in
214	accordance with this section unless otherwise mutually agreed to
215	in writing by the parties. This paragraph does not abrogate a
216	judgment debtor's obligation to satisfy the entire amount of any
217	judgment.
218	(b)1.  If financial responsibility requirements are met by
219	maintaining an escrow account as provided for in this section,
220	the physician shall, at the time of applying for or renewing a
221	license, and within 10 days after any such escrow account is
222	opened, submit to the department a sworn statement identifying
223	the assets held in escrow and their value; identifying the
224	financial institution that is holding the escrow; affirming that
225	the account is nonassignable, nontransferable, and not
226	encumbered or pledged to a purpose other than meeting the
227	financial responsibility requirements of this section; and
228	granting such authorization as is necessary for the department
229	to verify such information with the financial institution. A
230	copy of the escrow agreement and a recent statement from the
231	institution reflecting the value of the assets in the escrow
232	account shall accompany the statement and are considered to be
233	incorporated in the statement.
234	2.  If financial responsibility requirements are met by
235	maintaining a letter of credit as provided for in this section,
236	the physician shall, at the time of applying for or renewing a
237	license, and within 10 days after any such letter of credit is
238	issued, submit to the department a sworn statement identifying
239	the financial institution that issued the letter of credit;
240	affirming that the letter of credit is nonassignable,
241	nontransferable, otherwise meets the requirements of this
242	section, and is not encumbered or pledged to a purpose other
243	than meeting the financial responsibility requirements in this
244	section; and granting such authorization as is necessary for the
245	department to verify such information with the financial
246	institution. A copy of the letter of credit shall accompany the
247	statement and is considered to be incorporated in the statement.
248	3.  If financial responsibility requirements are met by
249	maintaining an escrow account or letter of credit as provided in
250	this section, upon the entry of an adverse final judgment
251	arising from a medical malpractice arbitration award, from a
252	claim of medical malpractice either in contract or tort, or from
253	noncompliance with the terms of a settlement agreement arising
254	from a claim of medical malpractice either in contract or tort,
255	the licensee shall pay the entire amount of the judgment
256	together with all accrued interest, or the amount maintained in
257	the escrow account or provided in the letter of credit as
258	required by this section, whichever is less, within 60 days
259	after the date such judgment became final and subject to
260	execution, unless otherwise mutually agreed to in writing by the
261	parties. If timely payment is not made by the physician, the
262	department shall suspend the license of the physician pursuant
263	to procedures set forth in subsection (6) subparagraphs
264	(5)(g)3., 4., and 5. Nothing in This paragraph does not shall
265	abrogate a judgment debtor's obligation to satisfy the entire
266	amount of any judgment.
267	(c)1.  Each insurer, self-insurer, risk retention group, or
268	the Joint Underwriting Association shall promptly notify the
269	department of the cancellation or nonrenewal of insurance that
270	is required by this section. Each bank or savings association
271	shall promptly notify the department of the closing or transfer
272	of an escrow account, or the cancellation or expiration of a
273	letter of credit, which account or letter is required by this
274	section.
275	2.  Within 10 days after the cancellation or nonrenewal of
276	professional liability insurance, the closing or transfer of an
277	escrow account, or the cancellation or expiration of a letter of
278	credit being used by a physician to meet the financial
279	responsibility requirements of this section, such physician
280	shall notify the department of such cancellation or nonrenewal
281	of the insurance coverage, closing or transfer of the escrow
282	account, or cancellation or expiration of the letter of credit
283	and submit the sworn statement required by paragraph (a) or
284	paragraph (b) reflecting the institution of professional
285	liability insurance coverage, the opening of an escrow account,
286	or the issuance of a letter of credit, as applicable, to
287	otherwise meet the financial responsibility requirements of this
288	section. The department shall suspend, pursuant to ss. 120.569
289	and 120.57, the license of a physician whose liability insurance
290	is canceled or not renewed, whose escrow account is closed or
291	transferred, or whose letter of credit is canceled or expires
292	and who does not notify the department of such action and submit
293	the sworn statement required by this subsection demonstrating
294	that he or she is otherwise in compliance with the requirements
295	of this section. The department shall notify all health care
296	facilities licensed under chapter 395 of such suspension action.
297	A suspension under this subparagraph shall remain in effect
298	until the physician demonstrates compliance with the
299	requirements of this section. If any judgments or settlements
300	are pending at the time of suspension, those judgments or
301	settlements shall be paid in accordance with this section unless
302	otherwise agreed in writing by the parties. This paragraph does
303	not abrogate a judgment debtor's obligation to satisfy the
304	entire amount of any judgment.
305	(d)  The sworn statement required by paragraph (a) or
306	paragraph (b) shall include the following declaration: "Under
307	penalties of perjury, I declare that I have read the foregoing
308	statement and that the facts stated in it are true." The
309	declaration shall be printed or typed at the end of the
310	statement and above the signature of the physician making the
311	declaration. A physician who knowingly makes a false declaration
312	under this paragraph, in addition to being subject to discipline
313	as otherwise authorized by this chapter, commits the crime of
314	perjury by false written declaration, a felony of the third
315	degree, punishable as provided in s. 775.082, s. 775.083, or s.
316	775.084.
317	(e)  A physician who fails to timely file a statement
318	required by paragraph (a) or paragraph (b) or the notice
319	required by paragraph (c) commits a misdemeanor of the first
320	degree, punishable as provided in s. 775.082 or s. 775.083.
321	(5)  The requirements of subsections (1), (2), and (3) do
322	not apply to:
323	(a)  Any person licensed under this chapter who practices
324	medicine exclusively as an officer, employee, or agent of the
325	Federal Government or of the state or its agencies or its
326	subdivisions. For the purposes of this subsection, an agent of
327	the state, its agencies, or its subdivisions is a person who is
328	eligible for coverage under any self-insurance or insurance
329	program authorized by the provisions of s. 768.28(16).
330	(b)  Any person whose license has become inactive under
331	this chapter and who is not practicing medicine in this state.
332	Any person applying for reactivation of a license must show
333	either that such licensee maintained tail insurance coverage
334	which provided liability coverage for incidents that occurred on
335	or after January 1, 1987, or the initial date of licensure in
336	this state, whichever is later, and incidents that occurred
337	before the date on which the license became inactive; or such
338	licensee must submit an affidavit stating that such licensee has
339	no unsatisfied medical malpractice judgments or settlements at
340	the time of application for reactivation.
341	(c)  Any person holding a limited license pursuant to s.
342	458.317 and practicing under the scope of such limited license.
343	(d)  Any person licensed or certified under this chapter
344	who practices only in conjunction with his or her teaching
345	duties at an accredited medical school or in its main teaching
346	hospitals. Such person may engage in the practice of medicine to
347	the extent that such practice is incidental to and a necessary
348	part of duties in connection with the teaching position in the
349	medical school.
350	(e)  Any person holding an active license under this
351	chapter who is not practicing medicine in this state. If such
352	person initiates or resumes any practice of medicine in this
353	state, he or she must notify the department of such activity and
354	fulfill the financial responsibility requirements of this
355	section before resuming the practice of medicine in this state.
356	(f)  Any person holding an active license under this
357	chapter who meets all of the following criteria:
358	1.  The licensee has held an active license to practice in
359	this state or another state or some combination thereof for more
360	than 15 years.
361	2.  The licensee has either retired from the practice of
362	medicine or maintains a part-time practice of no more than 1,000
363	patient contact hours per year.
364	3.  The licensee has had no more than two claims for
365	medical malpractice resulting in an indemnity exceeding $25,000
366	within the previous 5-year period.
367	4.  The licensee has not been convicted of, or pled guilty
368	or nolo contendere to, any criminal violation specified in this
369	chapter or the medical practice act of any other state.
370	5.  The licensee has not been subject within the last 10
371	years of practice to license revocation or suspension for any
372	period of time; probation for a period of 3 years or longer; or
373	a fine of $500 or more for a violation of this chapter or the
374	medical practice act of another jurisdiction. The regulatory
375	agency's acceptance of a physician's relinquishment of a
376	license, stipulation, consent order, or other settlement,
377	offered in response to or in anticipation of the filing of
378	administrative charges against the physician's license,
379	constitutes action against the physician's license for the
380	purposes of this paragraph.
381	6.  The licensee has submitted a form supplying necessary
382	information as required by the department and an affidavit
383	affirming compliance with this paragraph.
384	7.  The licensee must submit biennially to the department
385	certification stating compliance with the provisions of this
386	paragraph. The licensee must, upon request, demonstrate to the
387	department information verifying compliance with this paragraph.
388
389	A licensee who meets the requirements of this paragraph must
390	post notice in the form of a sign prominently displayed in the
391	reception area and clearly noticeable by all patients or provide
392	a written statement to any person to whom medical services are
393	being provided. The sign or statement must read as follows:
394	"Under Florida law, physicians are generally required to carry
395	medical malpractice insurance or otherwise demonstrate financial
396	responsibility to cover potential claims for medical
397	malpractice. However, certain part-time physicians who meet
398	state requirements are exempt from the financial responsibility
399	law. YOUR DOCTOR MEETS THESE REQUIREMENTS AND HAS DECIDED NOT TO
400	CARRY MEDICAL MALPRACTICE INSURANCE. This notice is provided
401	pursuant to Florida law."
402	(g)  Any person holding an active license under this
403	chapter who agrees to meet all of the following criteria:
404	(6)1.  Upon the entry of an adverse final judgment arising
405	from a medical malpractice arbitration award, from a claim of
406	medical malpractice either in contract or tort, or from
407	noncompliance with the terms of a settlement agreement arising
408	from a claim of medical malpractice either in contract or tort,
409	a licensee who does not qualify for an exemption from the
410	financial responsibility requirements under subsection (5) the
411	licensee shall pay the judgment creditor at least the lesser of
412	the entire amount of the judgment with all accrued interest or
413	either $100,000, if the physician is licensed pursuant to this
414	chapter but does not maintain hospital staff privileges, or
415	$250,000, if the physician is licensed pursuant to this chapter
416	and maintains hospital staff privileges, within 30 60 days after
417	the date such judgment became final and subject to execution,
418	unless otherwise mutually agreed to in writing by the parties.
419	Such adverse final judgment shall include any cross-claim,
420	counterclaim, or claim for indemnity or contribution arising
421	from the claim of medical malpractice. This section does not
422	abrogate a licensee's obligation to satisfy the entire amount of
423	any judgment, arbitration award, or other court order.
424	(a)  Upon notification of the existence of an unsatisfied
425	judgment or payment pursuant to this subsection subparagraph,
426	the department shall notify the licensee by certified mail that
427	he or she shall be subject to disciplinary action unless, within
428	30 days from the date of mailing, he or she either:
429	1.a.  Shows proof that the unsatisfied judgment has been
430	paid in the amount specified in this subsection subparagraph; or
431	2.b.  Furnishes the department with a copy of a timely
432	filed notice of appeal and either:
433	a.(I)  A copy of a supersedeas bond properly posted in the
434	amount required by law; or
435	b.(II)  An order from a court of competent jurisdiction
436	staying execution on the final judgment pending disposition of
437	the appeal.
438	(b)2.  The Department of Health shall issue an emergency
439	order suspending the license of any licensee who, after 30 days
440	following the mailing receipt of a notice from the Department of
441	Health, has failed to: satisfy a medical malpractice claim
442	against him or her in accordance with this subsection; furnish
443	the Department of Health a copy of a timely filed notice of
444	appeal; furnish the Department of Health a copy of a supersedeas
445	bond properly posted in the amount required by law; or furnish
446	the Department of Health an order from a court of competent
447	jurisdiction staying execution on the final judgment pending
448	disposition of the appeal.
449	(c)3.  Upon the next meeting of the probable cause panel of
450	the board following 30 days after the date of mailing the notice
451	of disciplinary action to the licensee, the panel shall make a
452	determination of whether probable cause exists to take
453	disciplinary action against the licensee pursuant to paragraph
454	(a) subparagraph 1.
455	(d)4.  If the board determines that the factual
456	requirements of this subsection subparagraph 1. are met, it
457	shall take disciplinary action as it deems appropriate against
458	the licensee. Such disciplinary action shall include, at a
459	minimum, probation of the license with the restriction that the
460	licensee must make payments to the judgment creditor on a
461	schedule determined by the board to be reasonable and within the
462	financial capability of the physician. Notwithstanding any other
463	disciplinary penalty imposed, the disciplinary penalty may
464	include suspension of the license for a period not to exceed 5
465	years. In the event that an agreement to satisfy a judgment has
466	been met, the board shall remove any restriction on the license.
467	(e)  This subsection does not apply to a licensee whose
468	medical malpractice judgment or settlement is to be paid
469	pursuant to a licensee's professional liability insurance
470	coverage that is maintained in accordance with paragraph (1)(b)
471	or paragraph (2)(b).
472	5.  The licensee has completed a form supplying necessary
473	information as required by the department.
474
475	A licensee who meets the requirements of this paragraph shall be
476	required either to post notice in the form of a sign prominently
477	displayed in the reception area and clearly noticeable by all
478	patients or to provide a written statement to any person to whom
479	medical services are being provided. Such sign or statement
480	shall state: "Under Florida law, physicians are generally
481	required to carry medical malpractice insurance or otherwise
482	demonstrate financial responsibility to cover potential claims
483	for medical malpractice. YOUR DOCTOR HAS DECIDED NOT TO CARRY
484	MEDICAL MALPRACTICE INSURANCE. This is permitted under Florida
485	law subject to certain conditions. Florida law imposes penalties
486	against noninsured physicians who fail to satisfy adverse
487	judgments arising from claims of medical malpractice. This
488	notice is provided pursuant to Florida law."
489	(7)(6)  Any deceptive, untrue, or fraudulent representation
490	by the licensee with respect to any provision of this section
491	shall result in permanent disqualification from any exemption to
492	mandated financial responsibility as provided in this section
493	and shall constitute grounds for disciplinary action under s.
494	458.331.
495	(8)(7)  Any licensee who relies on any exemption from the
496	financial responsibility requirement shall notify the
497	department, in writing, of any change of circumstance regarding
498	his or her qualifications for such exemption and shall
499	demonstrate that he or she is in compliance with the
500	requirements of this section.
501	(9)  The department shall verify that the licensee has the
502	required financial responsibility in accordance with subsections
503	(1) and (2) before a license is granted or renewed.
504	(8)  Notwithstanding any other provision of this section,
505	the department shall suspend the license of any physician
506	against whom has been entered a final judgment, arbitration
507	award, or other order or who has entered into a settlement
508	agreement to pay damages arising out of a claim for medical
509	malpractice, if all appellate remedies have been exhausted and
510	payment up to the amounts required by this section has not been
511	made within 30 days after the entering of such judgment, award,
512	or order or agreement, until proof of payment is received by the
513	department or a payment schedule has been agreed upon by the
514	physician and the claimant and presented to the department. This
515	subsection does not apply to a physician who has met the
516	financial responsibility requirements in paragraphs (1)(b) and
517	(2)(b).
518	(10)(9)  The board shall adopt rules to implement the
519	provisions of this section.
520	Section 2.  Section 459.0085, Florida Statutes, is amended
521	to read:
522	459.0085  Financial responsibility.--
523	(1)  As a condition of licensing and maintaining an active
524	license, and prior to the issuance or renewal of an active
525	license or reactivation of an inactive license for the practice
526	of osteopathic medicine, an applicant must by one of the
527	following methods demonstrate to the satisfaction of the board
528	and the department financial responsibility to pay claims and
529	costs ancillary thereto arising out of the rendering of, or the
530	failure to render, medical care and or services:
531	(a)  Establishing and maintaining an escrow account
532	consisting of cash or assets eligible for deposit in accordance
533	with s. 625.52 in an amount sufficient to meet the minimum
534	annual aggregate claim amount the per-claim amounts specified in
535	paragraph (b). The escrow account must be payable to the
536	osteopathic physician as beneficiary upon presentation of a
537	final judgment indicating liability and awarding damages to be
538	paid by the osteopathic physician or upon presentation of a
539	settlement agreement signed by all parties to such agreement
540	when such final judgment or settlement is a result of a claim
541	arising out of the rendering of, or the failure to render,
542	medical care and services. The required escrow amount set forth
543	in this paragraph may not be used for litigation costs or
544	attorney's fees for the defense of any medical malpractice
545	claim. The escrow account must be nonassignable and
546	nontransferable. Such escrow account must be made with and held
547	by the trust department of a bank or savings association
548	organized and existing under the laws of this state or any bank
549	or savings association organized under the laws of this state or
550	a bank or savings association organized under the laws of the
551	United States which has its principal place of business in this
552	state or has a branch office that is authorized under the laws
553	of this state or of the United States to receive deposits in
554	this state.
555	(b)  Obtaining and maintaining professional liability
556	coverage in an amount not less than $100,000 per claim, with a
557	minimum annual aggregate of not less than $300,000, from an
558	authorized insurer as defined under s. 624.09, from a surplus
559	lines insurer as defined under s. 626.914(2), from a risk
560	retention group as defined under s. 627.942, from the Joint
561	Underwriting Association established under s. 627.351(4), or
562	through a plan of self-insurance as provided in s. 627.357. The
563	required coverage amount set forth in this paragraph may not be
564	used for litigation costs or attorney's fees for the defense of
565	any medical malpractice claim.
566	(c)  Obtaining and maintaining an unexpired, irrevocable
567	letter of credit, established pursuant to chapter 675, in an
568	amount sufficient to meet the minimum annual aggregate claim
569	amount specified in paragraph (b) not less than $100,000 per
570	claim, with a minimum aggregate availability of credit of not
571	less than $300,000. The letter of credit must be payable to the
572	osteopathic physician as beneficiary upon presentment of a final
573	judgment indicating liability and awarding damages to be paid by
574	the osteopathic physician or upon presentment of a settlement
575	agreement signed by all parties to such agreement when such
576	final judgment or settlement is a result of a claim arising out
577	of the rendering of, or the failure to render, medical care and
578	services. The letter of credit may not be used for litigation
579	costs or attorney's fees for the defense of any medical
580	malpractice claim. The letter of credit must be nonassignable
581	and nontransferable. Such letter of credit must be issued by any
582	bank or savings association organized and existing under the
583	laws of this state or any bank or savings association organized
584	under the laws of the United States which has its principal
585	place of business in this state or has a branch office that is
586	authorized under the laws of this state or of the United States
587	to receive deposits in this state.
588	(2)  Osteopathic physicians who perform surgery in an
589	ambulatory surgical center licensed under chapter 395 and, as a
590	continuing condition of hospital staff privileges, osteopathic
591	physicians who have staff privileges must also establish
592	financial responsibility by one of the following methods:
593	(a)  Establishing and maintaining an escrow account
594	consisting of cash or assets eligible for deposit in accordance
595	with s. 625.52 in an amount sufficient to meet the minimum
596	annual aggregate claim amount the per-claim amounts specified in
597	paragraph (b). The escrow account must be payable to the
598	osteopathic physician as beneficiary upon presentation of a
599	final judgment indicating liability and awarding damages to be
600	paid by the osteopathic physician or upon presentation of a
601	settlement agreement signed by all parties to such agreement
602	when such final judgment or settlement is a result of a claim
603	arising out of the rendering of, or the failure to render,
604	medical care and services. The required escrow amount set forth
605	in this paragraph may not be used for litigation costs or
606	attorney's fees for the defense of any medical malpractice
607	claim. The escrow account must be nonassignable and
608	nontransferable. Such escrow account must be made with and held
609	by the trust department of a bank or savings association
610	organized and existing under the laws of the state or any bank
611	or savings association organized under the laws of this state or
612	a bank or savings association organized under the laws of the
613	United States which has its principal place of business in this
614	state or has a branch office that is under the laws of the
615	United States to receive deposits in this state.
616	(b)  Obtaining and maintaining professional liability
617	coverage in an amount not less than $250,000 per claim, with a
618	minimum annual aggregate of not less than $750,000 from an
619	authorized insurer as defined under s. 624.09, from a surplus
620	lines insurer as defined under s. 626.914(2), from a risk
621	retention group as defined under s. 627.942, from the Joint
622	Underwriting Association established under s. 627.351(4),
623	through a plan of self-insurance as provided in s. 627.357, or
624	through a plan of self-insurance that meets the conditions
625	specified for satisfying financial responsibility in s. 766.110.
626	The required coverage amount set forth in this paragraph may not
627	be used for litigation costs or attorney's fees for the defense
628	of any medical malpractice claim.
629	(c)  Obtaining and maintaining an unexpired, irrevocable
630	letter of credit, established pursuant to chapter 675, in an
631	amount sufficient to meet the minimum annual aggregate claim
632	amount specified in paragraph (b) not less than $250,000 per
633	claim, with a minimum aggregate availability of credit of not
634	less than $750,000. The letter of credit must be payable to the
635	osteopathic physician as beneficiary upon presentment of a final
636	judgment indicating liability and awarding damages to be paid by
637	the osteopathic physician or upon presentment of a settlement
638	agreement signed by all parties to such agreement when such
639	final judgment or settlement is a result of a claim arising out
640	of the rendering of, or the failure to render, medical care and
641	services. The letter of credit may not be used for litigation
642	costs or attorney's fees for the defense of any medical
643	malpractice claim. The letter of credit must be nonassignable
644	and nontransferable. The letter of credit must be issued by any
645	bank or savings association organized and existing under the
646	laws of this state or any bank or savings association organized
647	under the laws of the United States which has its principal
648	place of business in this state or has a branch office that is
649	authorized under the laws of this state or of the United States
650	to receive deposits in this state.
651
652	This subsection shall be inclusive of the coverage in subsection
653	(1).
654	(3)(a)  Meeting the financial responsibility requirements
655	of this section or the criteria for any exemption from such
656	requirements must be established at the time of issuance or
657	renewal of a license.
658	(b)  Any person may, at any time, submit to the department
659	a request for an advisory opinion regarding such person's
660	qualifications for exemption.
661	(4)(a)  If financial responsibility requirements are met by
662	maintaining professional liability insurance as provided for in
663	this section, the physician shall, at the time of applying for
664	or renewing a license, and within 10 days after any such
665	insurance coverage is instituted, submit to the department a
666	sworn statement identifying the insurer and certifying that the
667	coverage meets the requirements of this section. The statement
668	shall be accompanied by a copy of the certificate of insurance
669	which shall be deemed to be incorporated in the statement. Each
670	insurer, self-insurer, risk retention group, or joint
671	underwriting association must promptly notify the department of
672	cancellation or nonrenewal of insurance required by this
673	section. Unless the osteopathic physician demonstrates that he
674	or she is otherwise in compliance with the requirements of this
675	section, the department shall suspend the license of the
676	osteopathic physician pursuant to ss. 120.569 and 120.57 and
677	notify all health care facilities licensed under chapter 395,
678	part IV of chapter 394, or part I of chapter 641 of such action.
679	Any suspension under this subsection remains in effect until the
680	osteopathic physician demonstrates compliance with the
681	requirements of this section. If any judgments or settlements
682	are pending at the time of suspension, those judgments or
683	settlements must be paid in accordance with this section unless
684	otherwise mutually agreed to in writing by the parties. This
685	paragraph does not abrogate a judgment debtor's obligation to
686	satisfy the entire amount of any judgment.
687	(b)1.  If financial responsibility requirements are met by
688	maintaining an escrow account as provided for in this section,
689	the physician shall, at the time of applying for or renewing a
690	license, and within 10 days after any such escrow account is
691	opened, submit to the department a sworn statement identifying
692	the assets held in escrow and their value; identifying the
693	financial institution that is holding the escrow; affirming that
694	the account is nonassignable, nontransferable, and not
695	encumbered or pledged to a purpose other than meeting the
696	financial responsibility requirements of this section; and
697	granting such authorization as is necessary for the department
698	to verify such information with the financial institution. A
699	copy of the escrow agreement and a recent statement from the
700	institution reflecting the value of the assets in the escrow
701	account shall accompany the statement and is considered to be
702	incorporated in the statement.
703	2.  If financial responsibility requirements are met by
704	maintaining a letter of credit as provided for in this section,
705	the physician shall, at the time of applying for or renewing a
706	license, and within 10 days after any such letter of credit is
707	issued, submit to the department a sworn statement identifying
708	the financial institution that issued the letter of credit;
709	affirming that the letter of credit is nonassignable,
710	nontransferable, otherwise meets the requirements of this
711	section, and is not encumbered or pledged to a purpose other
712	than meeting the financial responsibility requirements in this
713	section; and granting such authorization as is necessary for the
714	department to verify such information with the financial
715	institution. A copy of the letter of credit shall accompany the
716	statement and is considered to be incorporated in the statement.
717	3.  If financial responsibility requirements are met by
718	maintaining an escrow account or letter of credit as provided in
719	this section, upon the entry of an adverse final judgment
720	arising from a medical malpractice arbitration award, from a
721	claim of medical malpractice either in contract or tort, or from
722	noncompliance with the terms of a settlement agreement arising
723	from a claim of medical malpractice either in contract or tort,
724	the licensee shall pay the entire amount of the judgment
725	together with all accrued interest or the amount maintained in
726	the escrow account or provided in the letter of credit as
727	required by this section, whichever is less, within 60 days
728	after the date such judgment became final and subject to
729	execution, unless otherwise mutually agreed to in writing by the
730	parties. If timely payment is not made by the osteopathic
731	physician, the department shall suspend the license of the
732	osteopathic physician pursuant to procedures set forth in
733	subsection (6) subparagraphs (5)(g)3., 4., and 5. Nothing in
734	This paragraph does not shall abrogate a judgment debtor's
735	obligation to satisfy the entire amount of any judgment.
736	(c)1.  Each insurer, self-insurer, risk retention group, or
737	the Joint Underwriting Association shall promptly notify the
738	department of the cancellation or nonrenewal of insurance that
739	is required by this section. Each bank or savings association
740	shall promptly notify the department of the closing or transfer
741	of an escrow account, or the cancellation or expiration of a
742	letter of credit, which account or letter is required by this
743	section.
744	2.  Within 10 days after the cancellation or nonrenewal of
745	professional liability insurance, the closing or transfer of an
746	escrow account, or the cancellation or expiration of a letter of
747	credit being used by a physician to meet the financial
748	responsibility requirements of this section, such physician
749	shall notify the department of such cancellation or nonrenewal
750	of the insurance coverage, closing or transfer of the escrow
751	account, or cancellation or expiration of the letter of credit,
752	and submit the sworn statement required by paragraph (a) or
753	paragraph (b) reflecting the institution of professional
754	liability insurance coverage, the opening of an escrow account,
755	or the issuance of a letter of credit, as applicable, to
756	otherwise meet the financial responsibility requirements of this
757	section. The department shall suspend, pursuant to ss. 120.569
758	and 120.57, the license of a physician whose liability insurance
759	is canceled or not renewed, whose escrow account is closed or
760	transferred, or whose letter of credit is canceled or expires,
761	and who does not notify the department of such action and submit
762	the sworn statement required by this subsection demonstrating
763	that he or she is otherwise in compliance with the requirements
764	of this section. The department shall notify all health care
765	facilities licensed under chapter 395 of such suspension action.
766	A suspension under this subparagraph shall remain in effect
767	until the physician demonstrates compliance with the
768	requirements of this section. If any judgments or settlements
769	are pending at the time of suspension, those judgments or
770	settlements shall be paid in accordance with this section unless
771	otherwise agreed in writing by the parties. This paragraph does
772	not abrogate a judgment debtor's obligation to satisfy the
773	entire amount of any judgment.
774	(d)  The sworn statement required by paragraph (a) or
775	paragraph (b) shall include the following declaration: "Under
776	penalties of perjury, I declare that I have read the foregoing
777	statement and that the facts stated in it are true." The
778	declaration shall be printed or typed at the end of the
779	statement and above the signature of the physician making the
780	declaration. A physician who knowingly makes a false declaration
781	under this paragraph, in addition to being subject to discipline
782	as otherwise authorized by this chapter, commits the crime of
783	perjury by false written declaration, a felony of the third
784	degree, punishable as provided in s. 775.082, s. 775.083, or s.
785	775.084.
786	(e)  A physician who fails to timely file a statement
787	required by paragraph (a) or paragraph (b) or the notice
788	required by paragraph (c) commits a misdemeanor of the first
789	degree, punishable as provided in s. 775.082 or s. 775.083.
790	(5)  The requirements of subsections (1), (2), and (3) do
791	not apply to:
792	(a)  Any person licensed under this chapter who practices
793	medicine exclusively as an officer, employee, or agent of the
794	Federal Government or of the state or its agencies or its
795	subdivisions. For the purposes of this subsection, an agent of
796	the state, its agencies, or its subdivisions is a person who is
797	eligible for coverage under any self-insurance or insurance
798	program authorized by the provisions of s. 768.28(16).
799	(b)  Any person whose license has become inactive under
800	this chapter and who is not practicing medicine in this state.
801	Any person applying for reactivation of a license must show
802	either that such licensee maintained tail insurance coverage
803	that provided liability coverage for incidents that occurred on
804	or after January 1, 1987, or the initial date of licensure in
805	this state, whichever is later, and incidents that occurred
806	before the date on which the license became inactive; or such
807	licensee must submit an affidavit stating that such licensee has
808	no unsatisfied medical malpractice judgments or settlements at
809	the time of application for reactivation.
810	(c)  Any person holding a limited license pursuant to s.
811	459.0075 and practicing under the scope of such limited license.
812	(d)  Any person licensed or certified under this chapter
813	who practices only in conjunction with his or her teaching
814	duties at a college of osteopathic medicine. Such person may
815	engage in the practice of osteopathic medicine to the extent
816	that such practice is incidental to and a necessary part of
817	duties in connection with the teaching position in the college
818	of osteopathic medicine.
819	(e)  Any person holding an active license under this
820	chapter who is not practicing osteopathic medicine in this
821	state. If such person initiates or resumes any practice of
822	osteopathic medicine in this state, he or she must notify the
823	department of such activity and fulfill the financial
824	responsibility requirements of this section before resuming the
825	practice of osteopathic medicine in this state.
826	(f)  Any person holding an active license under this
827	chapter who meets all of the following criteria:
828	1.  The licensee has held an active license to practice in
829	this state or another state or some combination thereof for more
830	than 15 years.
831	2.  The licensee has either retired from the practice of
832	osteopathic medicine or maintains a part-time practice of
833	osteopathic medicine of no more than 1,000 patient contact hours
834	per year.
835	3.  The licensee has had no more than two claims for
836	medical malpractice resulting in an indemnity exceeding $25,000
837	within the previous 5-year period.
838	4.  The licensee has not been convicted of, or pled guilty
839	or nolo contendere to, any criminal violation specified in this
840	chapter or the practice act of any other state.
841	5.  The licensee has not been subject within the last 10
842	years of practice to license revocation or suspension for any
843	period of time, probation for a period of 3 years or longer, or
844	a fine of $500 or more for a violation of this chapter or the
845	medical practice act of another jurisdiction. The regulatory
846	agency's acceptance of an osteopathic physician's relinquishment
847	of a license, stipulation, consent order, or other settlement,
848	offered in response to or in anticipation of the filing of
849	administrative charges against the osteopathic physician's
850	license, constitutes action against the physician's license for
851	the purposes of this paragraph.
852	6.  The licensee has submitted a form supplying necessary
853	information as required by the department and an affidavit
854	affirming compliance with this paragraph.
855	7.  The licensee must submit biennially to the department a
856	certification stating compliance with this paragraph. The
857	licensee must, upon request, demonstrate to the department
858	information verifying compliance with this paragraph.
859
860	A licensee who meets the requirements of this paragraph must
861	post notice in the form of a sign prominently displayed in the
862	reception area and clearly noticeable by all patients or provide
863	a written statement to any person to whom medical services are
864	being provided. The sign or statement must read as follows:
865	"Under Florida law, osteopathic physicians are generally
866	required to carry medical malpractice insurance or otherwise
867	demonstrate financial responsibility to cover potential claims
868	for medical malpractice. However, certain part-time osteopathic
869	physicians who meet state requirements are exempt from the
870	financial responsibility law. YOUR OSTEOPATHIC PHYSICIAN MEETS
871	THESE REQUIREMENTS AND HAS DECIDED NOT TO CARRY MEDICAL
872	MALPRACTICE INSURANCE. This notice is provided pursuant to
873	Florida law."
874	(g)  Any person holding an active license under this
875	chapter who agrees to meet all of the following criteria.
876	(6)1.  Upon the entry of an adverse final judgment arising
877	from a medical malpractice arbitration award, from a claim of
878	medical malpractice either in contract or tort, or from
879	noncompliance with the terms of a settlement agreement arising
880	from a claim of medical malpractice either in contract or tort,
881	a licensee who does not qualify for an exemption from the
882	financial responsibility requirements under subsection (5) the
883	licensee shall pay the judgment creditor at least the lesser of
884	the entire amount of the judgment with all accrued interest or
885	either $100,000, if the osteopathic physician is licensed
886	pursuant to this chapter but does not maintain hospital staff
887	privileges, or $250,000, if the osteopathic physician is
888	licensed pursuant to this chapter and maintains hospital staff
889	privileges, within 30 60 days after the date such judgment
890	became final and subject to execution, unless otherwise mutually
891	agreed to in writing by the parties. Such adverse final judgment
892	shall include any cross-claim, counterclaim, or claim for
893	indemnity or contribution arising from the claim of medical
894	malpractice. This section does not abrogate a licensee's
895	obligation to satisfy the entire amount of any judgment,
896	arbitration award, or other court order.
897	(a)  Upon notification of the existence of an unsatisfied
898	judgment or payment pursuant to this subsection subparagraph,
899	the department shall notify the licensee by certified mail that
900	he or she shall be subject to disciplinary action unless, within
901	30 days from the date of mailing, the licensee either:
902	1.a.  Shows proof that the unsatisfied judgment has been
903	paid in the amount specified in this subsection subparagraph; or
904	2.b.  Furnishes the department with a copy of a timely
905	filed notice of appeal and either:
906	a.(I)  A copy of a supersedeas bond properly posted in the
907	amount required by law; or
908	b.(II)  An order from a court of competent jurisdiction
909	staying execution on the final judgment, pending disposition of
910	the appeal.
911	(b)2.  The Department of Health shall issue an emergency
912	order suspending the license of any licensee who, after 30 days
913	following the mailing receipt of a notice from the Department of
914	Health, has failed to: satisfy a medical malpractice claim
915	against him or her in accordance with this subsection; furnish
916	the Department of Health a copy of a timely filed notice of
917	appeal; furnish the Department of Health a copy of a supersedeas
918	bond properly posted in the amount required by law; or furnish
919	the Department of Health an order from a court of competent
920	jurisdiction staying execution on the final judgment pending
921	disposition of the appeal.
922	(c)3.  Upon the next meeting of the probable cause panel of
923	the board following 30 days after the date of mailing the notice
924	of disciplinary action to the licensee, the panel shall make a
925	determination of whether probable cause exists to take
926	disciplinary action against the licensee pursuant to paragraph
927	(a) subparagraph 1.
928	(d)4.  If the board determines that the factual
929	requirements of this subsection subparagraph 1. are met, it
930	shall take disciplinary action as it deems appropriate against
931	the licensee. Such disciplinary action shall include, at a
932	minimum, probation of the license with the restriction that the
933	licensee must make payments to the judgment creditor on a
934	schedule determined by the board to be reasonable and within the
935	financial capability of the osteopathic physician.
936	Notwithstanding any other disciplinary penalty imposed, the
937	disciplinary penalty may include suspension of the license for a
938	period not to exceed 5 years. In the event that an agreement to
939	satisfy a judgment has been met, the board shall remove any
940	restriction on the license.
941	(e)  This subsection does not apply to a licensee whose
942	medical malpractice judgment or settlement is to be paid
943	pursuant to a licensee's professional liability insurance
944	coverage that is maintained in accordance with paragraph (1)(b)
945	or paragraph (2)(b).
946	5.  The licensee has completed a form supplying necessary
947	information as required by the department.
948
949	A licensee who meets the requirements of this paragraph shall be
950	required either to post notice in the form of a sign prominently
951	displayed in the reception area and clearly noticeable by all
952	patients or to provide a written statement to any person to whom
953	medical services are being provided. Such sign or statement
954	shall state: "Under Florida law, osteopathic physicians are
955	generally required to carry medical malpractice insurance or
956	otherwise demonstrate financial responsibility to cover
957	potential claims for medical malpractice. YOUR OSTEOPATHIC
958	PHYSICIAN HAS DECIDED NOT TO CARRY MEDICAL MALPRACTICE
959	INSURANCE. This is permitted under Florida law subject to
960	certain conditions. Florida law imposes strict penalties against
961	noninsured osteopathic physicians who fail to satisfy adverse
962	judgments arising from claims of medical malpractice. This
963	notice is provided pursuant to Florida law."
964	(7)(6)  Any deceptive, untrue, or fraudulent representation
965	by the licensee with respect to any provision of this section
966	shall result in permanent disqualification from any exemption to
967	mandated financial responsibility as provided in this section
968	and shall constitute grounds for disciplinary action under s.
969	459.015.
970	(8)(7)  Any licensee who relies on any exemption from the
971	financial responsibility requirement shall notify the department
972	in writing of any change of circumstance regarding his or her
973	qualifications for such exemption and shall demonstrate that he
974	or she is in compliance with the requirements of this section.
975	(9)(8)  If a physician is either a resident physician,
976	assistant resident physician, or intern in an approved
977	postgraduate training program, as defined by the board's rules,
978	and is supervised by a physician who is participating in the
979	Florida Birth-Related Neurological Injury Compensation Plan,
980	such resident physician, assistant resident physician, or intern
981	is deemed to be a participating physician without the payment of
982	the assessment set forth in s. 766.314(4).
983	(10)  The department shall verify that the licensee has the
984	required financial responsibility in accordance with subsections
985	(1) and (2) before a license is granted or renewed.
986	(9)  Notwithstanding any other provision of this section,
987	the department shall suspend the license of any osteopathic
988	physician against whom has been entered a final judgment,
989	arbitration award, or other order or who has entered into a
990	settlement agreement to pay damages arising out of a claim for
991	medical malpractice, if all appellate remedies have been
992	exhausted and payment up to the amounts required by this section
993	has not been made within 30 days after the entering of such
994	judgment, award, or order or agreement, until proof of payment
995	is received by the department or a payment schedule has been
996	agreed upon by the osteopathic physician and the claimant and
997	presented to the department. This subsection does not apply to
998	an osteopathic physician who has met the financial
999	responsibility requirements in paragraphs (1)(b) and (2)(b).
1000	(11)(10)  The board shall adopt rules to implement the
1001	provisions of this section.
1002	Section 3.  This act shall take effect upon becoming a law.

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